Enterprise Financial Services

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
☒    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2024
or
☐    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________ to ____________
Commission File Number: 001-15373
 ENTERPRISE FINANCIAL SERVICES CORP
(Exact name of registrant as specified in its charter)
Delaware
43-1706259
(State or Other Jurisdiction of
(I.R.S. Employer
Incorporation or Organization)
Identification No.)
150 North Meramec Avenue, Clayton, MO 63105
(Address of Principal Executive Offices)
(314) 725-5500
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
(Title of each class)
(Trading Symbol)
(Name of each exchange on which registered)
Common Stock, par value $.01 per share
EFSC
Nasdaq Global Select Market
Depositary Shares, each representing a 1/40th interest in a share of
5.00% Fixed Rate Non-Cumulative Perpetual Preferred Stock,
Series A
EFSCP
Nasdaq Global Select Market
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No ¨
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ¨ No x
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter)
during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions
of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☒
Accelerated filer
☐
Non-accelerated filer
☐
Smaller reporting company
☐
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards
provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section
404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to
previously issued financial statements. ¨
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers
during the relevant recovery period pursuant to §240.10D-1(b). ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐  No x
The aggregate market value of the voting and non-voting common stock held by non-affiliates of the Registrant was approximately $1,492,603,886 based on the closing price of the common stock of
$40.91 as of the last business day of the registrant’s most recently completed second fiscal quarter (June 30, 2024) as reported by the Nasdaq Global Select Market.
As of February 26, 2025, the Registrant had 36,979,376 shares of outstanding common stock.

DOCUMENTS INCORPORATED BY REFERENCE
Portions of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 are incorporated by reference into Item 7 of this Annual Report on Form 10-K. Additionally, the information
required by Items 10, 11, 12, 13 and 14 of Part III of this Annual Report on Form 10-K is incorporated by reference to the Registrant’s Definitive Proxy Statement for its 2025 Annual Meeting of
Shareholders, which will be filed pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended.

ENTERPRISE FINANCIAL SERVICES CORP
2024 ANNUAL REPORT ON FORM 10-K
TABLE OF CONTENTS
 
 
Page
PART I
 
Item 1.
Business
1
Item 1A.
Risk Factors
14
Item 1B.
Unresolved Staff Comments
27
Item 1C.
Cybersecurity
27
Item 2.
Properties
28
Item 3.
Legal Proceedings
28
Item 4.
Mine Safety Disclosures
29
PART II
Item 5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
29
Item 6.
Reserved
30
Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
31
Item 7A.
Quantitative and Qualitative Disclosures About Market Risk
59
Item 8.
Financial Statements and Supplementary Data
60
Item 9.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
119
Item 9A.
Controls and Procedures
119
Item 9B.
Other Information
120
Item 9C.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
120
PART III
Item 10.
Directors, Executive Officers, and Corporate Governance
120
Item 11.
Executive Compensation
120
Item 12.
Security Ownership of Certain Beneficial Owners, and Management and Related Stockholder Matters
121
Item 13.
Certain Relationships and Related Transactions, and Director Independence
121
Item 14.
Principal Accountant Fees and Services
122
PART IV
Item 15.
Exhibits and Financial Statement Schedules
123
Item 16.
Form 10-K Summary
126
SIGNATURES
127

Glossary of Acronyms, Abbreviations and Entities
The acronyms and abbreviations identified below are used in various sections of this Form 10-K, including “Management’s Discussion and
Analysis of Financial Condition and Results of Operations,” in Item 7 and the Consolidated Financial Statements and the Notes to Consolidated
Financial Statements in Item 8 of this Form 10-K.
ACL
Allowance for Credit Losses
FDIC
Federal Deposit Insurance Corporation
ASC
Accounting Standards Codification
Federal Reserve Board of Governors of the Federal Reserve System
ASU
Accounting Standards Update
FHLB
Federal Home Loan Bank
Bank
Enterprise Bank & Trust
GAAP
Generally Accepted Accounting Principles
BHCA
Bank Holding Company Act of 1956, as amended
GDP
Gross Domestic Product
Board or Board
of Directors
Enterprise Financial Services Corp Board of Directors
ICE
The Intercontinental Exchange
C&I
Commercial and Industrial
LIBOR
London Interbank Offered Rate
CCB
Capital Conservation Buffer
MD&A
Management’s Discussion and Analysis of Financial
Condition and Results of Operations
CDFI
Community Development Financial Institution
MSA
Metropolitan Statistical Area
CECL
Current Expected Credit Loss
NM
Not meaningful
CET1
Common Equity Tier 1 Capital
OCC
Office of the Comptroller of the Currency
CFPB
Consumer Financial Protection Bureau
PCD
Purchased Credit Deteriorated
Company or
Enterprise
Enterprise Financial Services Corp and Subsidiaries
SBA
U.S. Small Business Administration
CRA
Community Reinvestment Act
SBIC
Small Business Investment Company
CRE
Commercial Real Estate
SEC
Securities and Exchange Commission
Dodd-Frank Act Dodd-Frank Wall Street Reform and Consumer Protection Act of
2010
SOFR
Secured Overnight Financing Rate
EFSC
Enterprise Financial Services Corp
We, Us, Our
Enterprise Financial Services Corp and Subsidiaries
FASB
Financial Accounting Standards Board

PART 1
ITEM 1: BUSINESS
Forward-Looking Information
Some of the information in this Annual Report on Form 10-K 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, and by Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are based on
management’s current expectations and beliefs concerning future developments and their potential effects on the Company, and include, without
limitation, statements about the Company’s plans, strategies, goals, objectives, expectations, or consequences of statements about the future
performance, operations, products and services of the Company and its subsidiaries, as well as 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, products and services, shareholder value creation and the impact of acquisitions. Forward-looking statements typically
are identified with use of terms such as “may,” “might,” “will, “would,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,”
“predict,” “intend,” “potential,” “could,” “continue” and the negative and other variations of these terms and similar words, although some
forward-looking statements may be expressed differently. Forward-looking statements are typically identified by words such as “believe,”
“expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project,” “pro forma”, “pipeline” 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. They are neither statements of historical fact nor guarantees or assurances of future performance.
While there is no assurance that any list of risks and uncertainties or risk factors is complete, important factors that could cause actual results to
differ materially from those in the forward-looking statements include the following, without limitation: the Company’s ability to efficiently
integrate acquisitions 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 and market conditions, high unemployment rates, higher inflation and its impacts (including U.S. federal government
measures to address higher inflation), U.S. fiscal debt, budget and tax matters, and any slowdown in global economic growth, risks associated
with rapid increases or decreases in prevailing interest rates, our ability to attract and retain deposits and access to other sources of liquidity,
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 legislative or regulatory requirements,
as well as current, pending or future legislation or regulation that could have a negative effect on our revenue and businesses, including rules
and regulations relating to bank products and financial services, changes in accounting policies and practices or accounting standards, natural
disasters (such as wildfires and earthquakes), terrorist activities, war and geopolitical matters (including the war in Israel and potential for a
broader regional conflict and the war in Ukraine and the imposition of additional sanctions and export controls in connection therewith), or
pandemics, and their effects on economic and business environments in which we operate, including the related disruption to the financial
market and other economic activity; and other risks discussed under the caption “Risk Factors” in Item 1A of this Annual Report on Form 10-K,
all of which could cause actual results to differ from those set forth in the forward-looking statements. The Company cautions that the preceding
list is not exhaustive of all possible risk factors and other factors could also adversely affect the Company’s results.
Readers are cautioned not to place undue reliance on forward-looking statements, which reflect management’s analysis and expectations only as
of the date of such statements. Forward-looking statements speak only as of the date they are made, and the Company does not intend, and
undertakes no obligation, to publicly revise or update forward-looking statements after the date of this report, whether as a result of new
information, future events or otherwise, except as required by federal securities law. You should understand that it is not possible to predict or
identify all risk factors. Readers should carefully review all disclosures we file from time to time with the SEC which are available on the
Company’s website at www.enterprisebank.com under “Investor Relations.”
1

General Development and Description of Our Business
Enterprise Financial Services Corp, headquartered in Clayton, Missouri, is a financial holding company incorporated under Delaware law in
December 1994. EFSC is the holding company for Enterprise Bank & Trust, a full-service financial institution offering banking and wealth
management services to individuals and corporate customers primarily located in Arizona, California, Florida, Kansas, Missouri, Nevada, and
New Mexico, in addition to loan and deposit production offices throughout the United States. Our executive offices are located at 150 North
Meramec Avenue, Clayton, Missouri 63105, and our telephone number is (314) 725-5500.
Our stated mission is “Guiding people to a lifetime of financial success.” We have established an accompanying corporate vision, “To be a
company where our associates are proud to work, that delivers ease of navigation to our customers and value to our investors, while helping our
communities flourish.” These tenets are fundamental to our business strategies and operations.
Our business objective is to generate attractive shareholder returns by providing comprehensive financial services primarily to privately-held
businesses, their owner families, and other success-minded individuals. To achieve these objectives we have developed a business strategy that
leverages a focused and relationship-oriented distribution and sales approach, with an emphasis on niche businesses, while maintaining prudent
credit and interest rate risk management, opportunities for fee income, appropriate supporting technology, and controlling expenses. We believe
this strategy allows us to maximize organic growth opportunities, which we supplement and enhance through disciplined growth through
acquisition.
As described in greater detail below, the Company offers a broad range of business and personal banking services, including wealth management
services. Lending services include C&I, CRE, real estate construction and development, residential real estate, SBA, consumer and other loan
products. A wide variety of deposit products, along with a complete suite of treasury management and international trade services, complement
our lending capabilities.
Building long-term client relationships – Our growth strategy is first and foremost client relationship driven. We continuously seek to add clients
who fit our target market of businesses, business owners, professionals, and associated relationships. Those relationships are maintained,
cultivated, and expanded over time by experienced banking officers and other trained professionals. We fund loan growth primarily with core
deposits from our business and professional clients in addition to consumers in our branch market areas. This is supplemented by borrowing or
other deposit sources, including advances from the FHLB and brokered certificates of deposits.
Specialized lending and product niches – We have focused our lending activities in specialty markets where we believe our expertise and
experience as a commercial lender provides advantages over other competitors. In addition, we have developed expertise in certain product
niches. These specialty niche activities focus on the following areas:
•
SBA 7(a). We have a team of experienced bankers in production offices across the country that originate loans through the SBA 7(a)
program. These loans are primarily owner-occupied, commercial real estate loans secured by a first lien. These loans predominantly have a
75% portion guaranteed by the SBA. By focusing on this specific product type, we have developed an expertise that differentiates us based
upon speed and reliability of execution.
•
Life Insurance Premium Finance. We specialize in financing whole life insurance premiums utilized in high net worth estate planning
through relationships with boutique estate planners throughout the country.
•
Sponsor Finance. We support mid-market company mergers and acquisitions in many domestic markets. We market directly to targeted
private equity firms, principally SBICs, and provide primarily senior debt financing to the portfolio companies. In addition, the Company
has both financing and depository relationships with the sponsors of the portfolio companies.
•
Tax Credit Related Lending. We are a secured lender on affordable housing projects funded through the use of federal and state low income
housing tax credits. In addition, we provide leveraged and other loans on projects
2

funded through the U.S. Department of the Treasury Community Development Financial Institution (“Treasury CDFI”) New Markets Tax
Credit (“NMTC”) Program. In 2023 and 2024, we were awarded $60.0 million and $50.0 million, respectively, in NMTC allocations from
the Treasury CDFI. These were our sixth and seventh NMTC allocations, respectively, and brings the total amount of these allocations to
$353.0 million. We will continue to participate in the application process for future awards, as well as serve as a secured lender to other
allocatees.
•
Tax Credit Brokerage. We have a minority ownership in a partnership that acquires, invests and sells, state low income housing tax
credits. We lend to the partnership and receive interest income and fee income as projects close or credits are sold. 
Deposit verticals – In addition to commercial operating accounts for our C&I customers, we offer deposit vertical accounts to customers in
certain industries with complex account needs. Our focus areas include community associations, property management, legal industry and
escrow services. These accounts are primarily demand accounts and have a low overall interest cost. Customers in our deposit vertical products
will typically receive an earnings credit that is used to offset the cost of maintaining the deposit accounts. Payments made by the Company
through the application of the earnings credit is reflected as a component of noninterest expense in the Consolidated Statement of Income.
Fee income business – We offer a broad range of treasury management products and services that benefit businesses ranging from large national
clients to local businesses. Customized solutions and special product bundles are available to clients of all sizes. In response to ever increasing
needs for data/information security and functional efficiency, we continue to offer cash management systems that employ mobile technology and
fraud detection/mitigation services. We offer a wide range of fiduciary, investment management, and financial advisory services. We also offer
customer hedging products, international banking, card services and tax credit businesses that generate fee income. The Company also invests in
certain private equity and SBIC investments that generate additional fee income.
Use of technology – Clients access our products and services both in physical branch locations as well as remotely. We offer online, device
applications, text and voice banking in addition to a variety of “on site” hardware and software solutions, such as remote deposit capture. These
portals facilitate access to the commercial and consumer products we offer such as internet banking, mobile banking, cash management products,
remote deposit capture, positive pay services, fraud detection and prevention, automated payables, check image, and statement and document
imaging. Additional service offerings currently supported by the Bank include controlled disbursements, repurchase agreements, and sweep
investment accounts. Our cash management suite of products blends technology and personal service, which we believe often creates a
competitive advantage over our competition. Technology products are also extensively utilized within the organization by associates in all lines
of business including operations and support, customer service, and financial reporting for internal management purposes and for external
compliance. In 2024, the Company successfully completed the conversion of its legacy core system into a new core banking platform.
Maintaining asset quality – We monitor asset quality through formal, ongoing, multiple-level reviews of loans in each market and specialized
lending niche. These reviews are overseen by the Bank’s credit administration department. In addition, the loan portfolio is subject to ongoing
monitoring by a loan review function that reports directly to the Bank’s Board of Directors or its committees.
Expense management – We manage expenses carefully through detailed budgeting and expense approval processes. Our success is gauged
through the measurement of the “efficiency ratio.” The efficiency ratio is equal to noninterest expense divided by total revenue (tax equivalent
net interest income plus noninterest income).
Growth through Acquisitions – Disciplined strategic acquisitions have contributed significantly to the Company’s growth and expansion.
3

Competition
The Company and its subsidiaries operate in highly competitive markets. Our geographic markets are served by multiple large financial and bank
holding companies with substantial capital resources and lending capacity. We face competition not only from other financial holding companies
and commercial banks, but also from credit unions, investment managers, insurers, brokerage firms, private credit, financial technology
companies, and other providers of financial services and products. Strong competition for deposit and loan products affects the rates of those
products, as well as the terms on which they are offered to customers.
Supervision and Regulation
The Company is a financial holding company registered under the BHCA and is subject to regulation, supervision and examination by the
Federal Reserve. The Bank is a Missouri trust company with banking powers and is subject to supervision and regulation by the Missouri
Division of Finance. In addition, as a Federal Reserve non-member bank, the Bank is subject to supervision and regulation by the FDIC.
The Company has more than $10 billion in assets and therefore is subject to examination by the CFPB.
The Company has securities registered with the SEC under the Securities Exchange Act of 1934, as amended. The Company’s common stock is
listed on the Nasdaq Stock Market. The Company also has depositary shares, each representing a 1/40th interest in a share of the Company’s 5%,
noncumulative perpetual preferred stock (“Series A Preferred Stock”), listed on the Nasdaq Stock Market. Accordingly, the Company is subject
to both SEC and Nasdaq listing standards.
The following is a summary description of the relevant laws, rules, and regulations governing banks and financial holding companies, including
the Company. The description of, and references to, the statutes and regulations below are brief summaries and do not purport to be complete.
The descriptions are qualified in their entirety by reference to the related statutes and regulations.
The regulatory and supervisory structure establishes a comprehensive framework of activities in which an institution can engage and is intended
primarily for the protection of depositors, the deposit insurance fund and the banking system as a whole, rather than for the protection of
shareholders or creditors. The regulatory structure also gives the regulatory authorities extensive discretion in connection with their supervisory
and enforcement activities and examination policies, including policies concerning the establishment of deposit insurance assessment fees,
classification of assets and establishment of adequate credit loss reserves for regulatory purposes. If federal or state regulatory authorities were to
take the position that the Company has violated any law or commitment or engaged in any unsafe or unsound practice, formal or informal
corrective or enforcement actions could be taken against the Company and institution-affiliated parties (such as directors, officers, and agents).
These enforcement actions could include an imposition of civil monetary penalties and could directly affect not only the Company and
institution-affiliated parties but also the Company’s counterparties, shareholders, and creditors and its commitments, arrangements, or other
dealings.
Various legislation is from time to time introduced in Congress and state legislatures where we operate. Such legislation may change applicable
statutes and the operating environment in substantial and unpredictable ways. We cannot determine the ultimate effect that future legislation or
implementing regulations would have on our financial condition or our results of operations or the results of operations of any of our
subsidiaries.
The Dodd-Frank Act is a comprehensive legislative act that contains a set of provisions designed to govern the practices and oversight of
financial institutions and other participants in the financial markets. The Dodd-Frank Act made extensive changes in the regulation of financial
institutions and their holding companies, including modifications made by the Economic Growth, Regulatory Relief, and Consumer Protection
Act of 2018.
4

Financial Holding Company
As a financial holding company, the Company is subject to regulation and examination by the Federal Reserve, and is required to file periodic
reports of its operations and such additional information as the Federal Reserve may require. In order to remain a financial holding company, the
Company must continue to be considered well-managed and well-capitalized by the Federal Reserve, and the Bank must continue to be
considered well-managed and well-capitalized by the FDIC, and have at least a “satisfactory” rating under the CRA. See “Liquidity and Capital
Resources” in the MD&A for more information on our capital adequacy, and “Bank Subsidiary - Community Reinvestment Act” below for more
information on the CRA.
Acquisitions: Under amendments to the BHCA promulgated by the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 and the
Dodd-Frank Act, the Company may acquire banks outside of its home State of Missouri, subject to specified limits and may establish new
branches in other States to the same extent as banks chartered in those States. With certain limited exceptions, the BHCA requires every financial
holding company or bank holding company to obtain the prior approval of the Federal Reserve and possibly other government authorities before
(i) acquiring substantially all the assets of any bank, (ii) acquiring direct or indirect ownership or control of any voting shares of any bank if,
after such acquisition, it would own or control more than 5% of the voting shares of such bank (unless it already owns or controls the majority of
such shares), or (iii) merging or consolidating with another bank holding company. Additionally, the BHCA provides that the Federal Reserve
may not approve any of these transactions if it would result in or tend to create a monopoly, substantially lessen competition, or otherwise
function as a restraint of trade, unless the anti-competitive effects of the proposed transaction are clearly outweighed by the public interest in
meeting the convenience and needs of the community to be served. The Federal Reserve also is required to consider the financial and managerial
resources and future prospects of the bank holding companies and banks concerned and the convenience and needs of the community to be
served. The Federal Reserve’s consideration of financial resources generally focuses on capital adequacy, which is described below.
Change in Bank Control: Subject to various exceptions, the BHCA and the Change in Bank Control Act, together with related regulations,
require Federal Reserve approval prior to any person or company acquiring “control” of a bank or financial holding company. Control is
conclusively presumed to exist if an individual or company acquires 25% or more of any class of voting securities of a company or controls a
majority of the board of directors. In certain circumstances, control is rebuttably presumed to exist if a person or company acquires 10% or more,
but less than 25%, of any class of voting securities of a company. The regulations provide a procedure for challenging rebuttable presumptions of
control.
Permitted Activities: The BHCA has generally prohibited a bank holding company from engaging in activities other than banking or managing or
controlling banks or other permissible subsidiaries and from acquiring or retaining direct or indirect control of any company engaged in any
activities other than those determined by the Federal Reserve to be closely related to banking or managing or controlling banks as to be a proper
incident thereto. Provisions of the Gramm-Leach-Bliley Act have expanded the permissible activities of a bank holding company that qualifies as
a financial holding company. Under the regulations implementing the Gramm-Leach-Bliley Act, a financial holding company may engage in
additional activities that are financial in nature or incidental or complementary to financial activities. Those activities include, among other
activities, certain insurance, advisory and securities activities.
Support of Bank Subsidiary: Under Federal Reserve policy, the Company is expected to act as a source of financial and managerial strength for
the Bank and to commit capital and financial resources to support the Bank. The Dodd-Frank Act codified this longstanding policy by adopting a
provision requiring, among other things, that bank holding companies serve as a source of strength for an subsidiary depository institution. Such
financial and managerial support from the Company may be required at times when, without this legal requirement, the Company may not be
inclined to provide it.
5

Capital Adequacy: The Company is subject to capital requirements and standards established by the Federal Reserve (“Basel III Capital Rules”)
that are applied on a consolidated basis. These requirements are substantially similar to those required of the Bank (summarized below).
Under the Basel III Capital Rules, capital instruments such as trust preferred securities and cumulative preferred shares have been phased out of
tier 1 capital for banking organizations that had $15 billion or more in total consolidated assets as of December 31, 2009, and have grandfathered
as tier 1 capital such instruments issued by smaller entities prior to May 19, 2010 (provided they do not exceed 25% of tier 1 capital). At
December 31, 2024, the Company had $93.0 million of trust preferred securities that are grandfathered under this provision. However, if the
Company has total assets of $15 billion and acquires another bank, or if an acquisition causes the Company to exceed $15 billion in total assets,
the trust preferred securities will no longer qualify as tier 1 instruments (but may be included in tier 2 capital).
Dividend Restrictions and Share Repurchases: From time to time the Company may engage in share repurchases. The Federal Reserve requires
that bank and financial holding companies, where certain conditions are triggered, provide prior notice to, consult with, and in certain
circumstances seek the approval of, the Federal Reserve or reserve bank staff prior to purchasing or redeeming its equity securities.
Under Federal Reserve policies, financial holding companies may pay cash dividends on common stock only out of income available over the
past year if prospective earnings retention is consistent with the organization’s expected future needs and financial condition and if the
organization is not in danger of failing to meet its minimum regulatory capital requirements. Federal Reserve policy also provides that financial
holding companies should not pay a level of cash dividends that undermines the financial holding company’s ability to serve as a source of
strength to its banking subsidiaries.
Dividends, repurchases and redemptions on the Company’s capital stock (common and preferred) are prohibited under the terms of the junior
subordinated debenture agreements (see “Item 8. Note 10 – Subordinated Debentures and Notes”) if the Company is in continuous default on its
payment obligations, has elected to defer interest payments or extends the interest payment period. Furthermore, unless dividends on all
outstanding shares of the Series A Preferred Stock for the most recently completed dividend period have been paid or declared, dividends on, and
repurchases of, common stock are prohibited.
Incentive Compensation: Federal banking agencies have issued guidance on incentive compensation policies intended to ensure that the
incentive compensation policies of banking organizations do not undermine the safety and soundness of such organizations by encouraging
excessive risk-taking. The guidance, which covers all employees that have the ability to materially affect the risk profile of an organization, is
based upon the key principles that a banking organization’s incentive compensation arrangements should (i) provide incentives that do not
encourage risk-taking beyond the organization’s ability to effectively identify and manage risks, (ii) be compatible with effective internal
controls and risk management, and (iii) be supported by strong corporate governance, including active and effective oversight by the
organization’s board of directors. In accordance with the Dodd-Frank Act, the federal banking agencies prohibit incentive-based compensation
arrangements that encourage inappropriate risk taking by covered financial institutions (generally institutions, like us, that have over $1 billion in
assets) and are deemed to be excessive, or that may lead to material losses.
The Federal Reserve will review, as part of the regular, risk-focused examination process, the incentive compensation arrangements of banking
organizations, such as the Company, that are not “large, complex banking organizations.” These reviews will be tailored to each organization
based on the scope and complexity of the organization’s activities and the prevalence of incentive compensation arrangements. The findings of
the supervisory initiatives will be included in reports of examination. Deficiencies will be incorporated into the organization’s supervisory
ratings, which can affect the organization’s ability to make acquisitions and take other actions. Enforcement actions may be taken against a
banking organization if its incentive compensation arrangements, or related risk- management control or governance processes, pose a risk to the
organization’s safety and soundness, and the organization is not taking prompt and effective measures to correct the deficiencies.
6

The scope and content of the U.S. banking regulators’ policies on executive compensation may continue to evolve in the near future. It cannot be
determined at this time whether compliance with such policies will adversely affect the Company’s ability to hire, retain, and motivate its key
employees.
In October 2022, the SEC adopted rules requiring securities exchanges, including Nasdaq, to adopt listing standards that require issuers to
develop and implement a policy providing, under certain circumstances, for the recovery of erroneously awarded incentive-based compensation
received by current or former executive officers. The rules, which were mandated as part of the Dodd-Frank Act became effective in January
2023. Pursuant to Nasdaq listing standards, the Company adopted a clawback policy that implemented the rules in the third quarter of 2023.
Bank Subsidiary
The Bank is subject to extensive federal and state regulatory oversight. The various regulatory authorities regulate or monitor all areas of the
banking operations, including security devices and procedures, adequacy of capitalization and loss reserves, loans, investments, borrowings,
deposits, mergers, issuance of securities, payment of dividends, interest rates payable on deposits, interest rates and fees chargeable on loans,
establishment of branches, corporate reorganizations, maintenance of books and records, and adequacy of staff training to carry on safe lending
and deposit gathering practices. The Bank must maintain certain capital ratios and is subject to limitations on aggregate investments in real
estate, bank premises, low-income housing projects, and furniture and fixtures. In connection with their supervision and regulation
responsibilities, the Bank is subject to periodic examination by the FDIC and Missouri Division of Finance.
Capital Adequacy: The Bank is required to comply with the FDIC’s capital adequacy standards for insured banks. The FDIC has issued risk-
based capital and leverage capital guidelines for measuring capital adequacy, and all applicable capital standards must be satisfied for the Bank
to be considered in compliance with regulatory capital requirements.
Prompt Corrective Action: The Bank’s capital categories are determined for the purpose of applying the “prompt corrective action” rules
described below and may be taken into consideration by banking regulators in evaluating proposals for expansion or new activities. They are not
necessarily an accurate representation of a bank’s overall financial condition or prospects for other purposes. A failure to meet the capital
guidelines could subject the Bank to a variety of enforcement actions under those rules, including the issuance of a capital directive, the
termination of deposit insurance by the FDIC, a prohibition on taking brokered deposits, and other restrictions on its business. As described
below, the FDIC also can impose other substantial restrictions on banks that fail to meet applicable capital requirements.
Federal law establishes a system of prompt corrective action to resolve the problems of undercapitalized banks. Under this system, the FDIC has
established five capital categories (“well-capitalized,” “adequately capitalized,” “undercapitalized,” “significantly undercapitalized,” and
“critically undercapitalized.") Federal and state bank regulators are authorized and required to take various mandatory supervisory and other
discretionary actions with respect to banks in the three undercapitalized categories. The severity of any such actions taken will depend upon the
capital category in which a bank is placed. Generally, subject to a narrow exception, current federal law requires the FDIC to appoint a receiver
or conservator for a bank that is critically undercapitalized.
The following table summarizes the prompt corrective action categories:
Prompt Corrective Action Category
Total Risk-Based
Capital
Tier 1 Risk-Based
Capital
Common Equity Tier 1
Risk-Based Capital
Tier 1 Leverage Ratio
Well-capitalized
10.0%
8.0%
6.5%
5.0%
Adequately capitalized
8.0%
6.0%
4.5%
4.0%
Undercapitalized
< 8.0%
< 6.0%
< 4.5%
< 4.0%
Significantly undercapitalized
< 6.0%
< 4.0%
< 3.0%
< 3.0%
Critically undercapitalized
Tangible equity / Total assets ≤ 2.0%
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In addition to the minimum capital ratios noted in the table above, the Basel III Capital Rules require the maintenance of a CCB consisting of
CET1 capital in an amount equal to 2.5% of risk weighted assets to avoid restrictions on the ability to make capital distributions and to pay
certain discretionary bonus payments to executive officers. The CCB effectively increases the minimum CET1 capital, tier 1 capital, and total
capital ratios for U.S. banking organizations to 7.0%, 8.5%, and 10.5%, respectively.
A bank that becomes “undercapitalized,” “significantly undercapitalized,” or “critically undercapitalized” is required to submit an acceptable
capital restoration plan to the FDIC. The capital restoration plan will not be accepted by the regulators unless each company having control of
the undercapitalized bank guarantees the bank subsidiary’s compliance with the capital restoration plan up to a certain specified amount. The
aggregate liability of the holding company of an undercapitalized bank is limited to the lesser of 5% of the institution’s assets at the time it
became undercapitalized or the amount necessary to cause the institution to be “adequately capitalized.” An “undercapitalized” bank also is
generally prohibited from increasing its average total assets, making acquisitions, establishing new branches, or engaging in any new line of
business, except in accordance with an accepted capital restoration plan or with the approval of the FDIC. Also, the FDIC may treat an
“undercapitalized” bank as being “significantly undercapitalized” if it determines that those actions are necessary to carry out the purpose of the
law.
The prompt corrective action regulations do not apply to bank holding companies, such as EFSC. However, the Federal Reserve is authorized to
take appropriate action at the bank holding company level, based upon the undercapitalized status of the bank holding company's depository
institution subsidiaries. In certain instances, relating to an undercapitalized depository institution subsidiary, the bank holding company would be
required to guarantee the performance of the undercapitalized subsidiary’s capital restoration plan and might be liable for civil money damages
for failure to fulfill its commitments on that guarantee. Furthermore, in the event of the bankruptcy of the bank holding company, the guarantee
would take priority over the bank holding company's general unsecured creditors, as described in “Support of Bank Subsidiary” above.
All of the Bank’s capital ratios were at levels that qualify it to be “well-capitalized” for regulatory purposes as of December 31, 2024 (see “Item
8. Note 14 – Regulatory Capital”).
FDIC Insurance of Certain Accounts and Regulation by the FDIC: The Bank’s deposits are insured under the Federal Deposit Insurance Act (the
"FDIA") up to the maximum applicable limits and are subject to deposit insurance assessments designed to tie what banks pay for deposit
insurance to the risks they pose. Under the FDIC’s assessment system for determining payments to the Deposit Insurance Fund (the "DIF"), large
insured depository institutions ("IDIs") with more than $10 billion in assets, like the Bank, are assessed pursuant to a complex methodology that
seeks to capture both the probability that an individual large IDI will fail and the magnitude of the impact on the DIF if such a failure occurs. The
assessment base of a large IDI is its total assets less tangible equity.
In November 2023, the FDIC finalized a rule that imposes special assessments to recover the losses to the DIF resulting from the FDIC’s use, in
March 2023, of the systemic risk exception to the least-cost resolution test under the FDIA in connection with the receiverships of Silicon Valley
Bank and Signature Bank. The special assessments will be collected at an annual rate of approximately 13.4 basis points per year (3.36 basis
points per quarter) over eight quarters in 2024 and 2025. The first assessment period began January 1, 2024. Because the estimated loss pursuant
to the systemic risk determination will be periodically adjusted, the FDIC retains the ability to cease collection early, extend the special
assessment collection period and impose a final shortfall special assessment on a one-time basis. In June 2024, due to the increased estimate of
losses, the FDIC announced that it projects that the special assessment will be collected for an additional two quarters beyond the initial eight-
quarter collection period, at a lower rate.
Consumer Financial Protection Bureau: The Dodd-Frank Act centralized responsibility for consumer financial protection including
implementing, examining and enforcing compliance with federal consumer financial laws with the CFPB. Depository institutions with more than
$10 billion in assets, such as the Bank, are subject to examination by the CFPB.
8

The CFPB has broad rule-making authority for a wide range of federal consumer protection laws that apply to all banks, including the authority
to prohibit unfair, deceptive or abusive acts and practices. In addition, the Dodd-Frank Act enhanced the regulation of mortgage banking and
gave to the CFPB oversight of many of the core laws which regulate the mortgage industry and the authority to implement mortgage regulations.
Any new regulations adopted by the CFPB may significantly impact consumer mortgage lending and servicing.
The Bank is also subject to other laws and regulations intended to protect consumers in transactions with depository institutions, as well as other
laws or regulations affecting customers of financial institutions generally. While the list set forth herein is not exhaustive, these laws and
regulations include the Truth in Lending Act, the Truth in Savings Act, the Electronic Funds Transfer Act, the Expedited Funds Availability Act,
the Equal Credit Opportunity Act, the Fair Housing Act, the Real Estate Settlement and Procedures Act, the Fair Credit Reporting Act and the
Federal Trade Commission Act, among others. These laws and regulations mandate certain disclosure requirements and regulate the manner in
which financial institutions must deal with customers when taking deposits or making loans to such customers. The Bank must comply with the
applicable provisions of these consumer protection laws and regulations as part of its ongoing customer relations.
The Bank’s consumer-oriented activities are also subject to various states and local consumer protection laws analogous, and in addition, to those
listed above which among other things, impose obligations relating to marketing, origination, servicing and collection activities in our consumer
business. Failure to comply with these laws and regulations could give rise to regulatory sanctions, customer rescission rights, action by state and
local attorneys general, and civil or criminal liability.
UDAP and UDAAP: Banking regulatory agencies have increasingly used a general consumer protection statute to address “unethical” or
otherwise “bad” business practices that may not necessarily fall directly under the purview of a specific banking or consumer finance law. The
law of choice for enforcement against such business practices has been Section 5 of the Federal Trade Commission Act - the primary federal law
that prohibits unfair or deceptive acts or practices and unfair methods of competition in or affecting commerce (“UDAP” or “FTC Act”).
“Unjustified consumer injury” is the principal focus of the FTC Act. Moreover, the UDAP provisions have been expanded under the Dodd-Frank
Act to apply to “unfair, deceptive or abusive acts or practices” (“UDAAP”), which has been delegated to the CFPB for supervision. The CFPB
has brought a variety of enforcement actions for violations of UDAAP provisions and CFPB guidance continues to evolve.
Mortgage Reform: The CFPB has adopted final rules implementing minimum standards for the origination of residential mortgages, including
standards regarding a customer’s ability to repay, restricting variable-rate lending by requiring the ability to repay variable-rate loans be
determined by using the maximum rate that could apply during the first five years of a variable-rate loan term, and making more loans subject to
provisions for higher cost loans, new disclosures, and certain other revisions. The Dodd-Frank Act allows borrowers to raise certain defenses to
foreclosure if they receive any loan other than a “qualified mortgage” as defined by the CFPB.
Dividends by the Bank Subsidiary: The Bank is a legal entity that is separate and distinct from EFSC. Statutory and regulatory limitations apply
to the Bank's payment of dividends to EFSC. Under Missouri law, the Bank may pay dividends to the Company only from a portion of its
undivided profits and may not pay dividends if its capital is impaired. As an insured depository institution, federal law prohibits the Bank from
making any capital distributions, including the payment of a cash dividend, if it is “undercapitalized” or after making the distribution would
become undercapitalized. If the FDIC believes the Bank is engaged in, or about to engage in, an unsafe or unsound practice, the FDIC may
require, after notice and hearing, that the Bank cease and desist from that practice. The FDIC has indicated that paying dividends that deplete a
depository institution’s capital base to an inadequate level would be an unsafe and unsound banking practice. The FDIC has issued policy
statements providing that insured banks generally should pay dividends only from their current operating earnings. The Bank’s payment of
dividends also could be affected or limited by other factors, such as events or circumstances which would lead the FDIC to require that it
maintain capital in excess of regulatory guidelines.
Transactions with Affiliates and Insiders: The Bank is subject to the provisions of Regulation W promulgated by the Federal Reserve, which
encompasses Sections 23A and 23B of the Federal Reserve Act. Regulation W places limits
9

and conditions on the amount of loans or extensions of credit to, investments in, or certain other transactions with, affiliates and on the amount of
advances to third parties collateralized by the securities or obligations of affiliates. Regulation W also prohibits, among other things, an
institution from engaging in certain transactions with certain affiliates unless the transactions are on terms substantially the same, or at least as
favorable to such institution or its subsidiaries, as those prevailing at the time for comparable transactions with nonaffiliated companies. Federal
law also places restrictions on the Bank’s ability to extend credit to its executive officers, directors, principal shareholders and their related
interests. These extensions of credit must be made on substantially the same terms, including interest rates and collateral, as those prevailing at
the time for comparable transactions with unrelated third parties; and must not involve more than the normal risk of repayment or present other
unfavorable features.
Community Reinvestment Act: The CRA requires that, in connection with examinations of financial institutions within its jurisdiction, the FDIC
is required to evaluate the record of the financial institutions in meeting the credit needs of their local communities, including low and moderate
income neighborhoods, consistent with the safe and sound operation of those institutions. The CRA does not establish specific lending
requirements or programs for financial institutions nor does it limit an institution's discretion to develop the types of products and services that it
believes are best suited to its particular community, but depository institutions may only receive CRA credit for certain types of lending and for
lending, investments and services that support community development, as defined in the CRA regulations. These factors are also considered in
evaluating mergers, acquisitions, and applications to open a branch or facility. If the Bank fails to maintain at least a "satisfactory" rating under
the CRA, it would be subject to restrictions on certain new activities and acquisitions. Additionally, federal banking agencies may take
compliance with fair lending laws and practices, including CRA into account when regulating and supervising other activities. The Bank has a
satisfactory rating under CRA.
Prior to 2023, the last significant interagency revision to the CRA regulations occurred in 1995. In May 2022, federal bank regulatory agencies
jointly issued a proposal to strengthen and modernize regulations implementing the CRA to better achieve the purposes of the law. On October
24, 2023, the Board of Governors of the Federal Reserve System, the FDIC, and the OCC issued a final rule amending the agencies’ CRA
regulations. The objective of the final rule is to strengthen the achievement of the core purpose of the statute, and adapt to changes in the banking
industry, including the expanded role of mobile and online banking. The final rule became effective on April 1, 2024, and most of the new
requirements are applicable beginning January 1, 2026, and the remaining requirements are applicable January 1, 2027.
Privacy and Cybersecurity Regulations: Our businesses are subject to numerous laws and regulations relating to the privacy of information
regarding clients, employees and others. These include, but are not limited to, the Gramm-Leach-Bliley Act, MO Rev Stat § 362.422 and the
California Consumer Privacy Act of 2018. Generally, privacy laws impose obligations with regard to the collection, use and disclosure of
personal information and require public disclosure of privacy practices. Some privacy laws offer individuals certain rights about how their
personal information is processed, provide for significant penalties for non-compliance, and, under certain circumstances, impose requirements
for transfers of personal data across national borders. Under federal law and state laws, a financial institution must provide to its customers, at
the inception of the customer relationship and annually thereafter, the institution’s policies and procedures regarding the handling of customers’
nonpublic personal financial information. These provisions also provide that, except for certain limited exceptions, a financial institution may not
provide such personal information to unaffiliated third parties unless the institution discloses to the customer that such information may be so
provided and the customer is given the opportunity to opt out of such disclosure.
Anti-Money Laundering, Anti-Terrorism and Sanctions: The Bank Secrecy Act (the "BSA") requires all financial institutions, including banks, to,
among other things, establish a risk-based system of internal controls reasonably designed to prevent money laundering and the financing of
terrorism. It includes a variety of recordkeeping and reporting requirements (such as cash and suspicious activity reporting) as well as due
diligence/know-your-customer documentation requirements. In June 2024, the United States Treasury Department’s Financial Crimes
Enforcement Network (“FinCEN”) issued a proposed rule that would amend the anti-money laundering/countering the financing of terrorism
(“AML/CFT”) program requirements for all financial institutions subject to the BSA with
10

AML/CFT program obligations, including the Bank. The proposed rule would, among other things, require that (i) financial institutions have a
risk assessment process to identify, evaluate, and document the financial institution’s money laundering, terrorist financing, and other illicit
activity risks, and (ii) the risk assessment process must be updated on a periodic basis, including when certain material changes occur in the
financial institution’s products, services, customer base, intermediaries, and geographic footprint. In July 2024, the OCC, the Federal Reserve,
and the FDIC each proposed rules to amend their respective BSA compliance program rules to align with FinCEN’s June 2024 proposed rule.
USA PATRIOT Act: The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001 (the “USA PATRIOT Act”) further augments and strengthens the requirements set forth in the BSA and requires each financial institution
to: (i) establish an anti-money laundering program; (ii) establish due diligence policies, procedures and controls with respect to its private
banking accounts and correspondent banking accounts involving foreign individuals and certain foreign banks; (iii) implement certain due
diligence policies, procedures and controls with regard to correspondent accounts in the United States for, or on behalf of, a foreign bank that
does not have a physical presence in any country; and (iv) eliminates civil liability for persons who file suspicious activity reports. In addition,
the USA PATRIOT Act contains a provision encouraging cooperation among financial institutions, regulatory authorities and law enforcement
authorities with respect to individuals, entities and organizations engaged in, or reasonably suspected of engaging in, terrorist acts or money
laundering activities. The USA PATRIOT Act includes provisions providing the government with the power to investigate terrorism, including
expanded government access to bank account records.
Commercial Real Estate Lending: The Bank’s lending operations may be subject to enhanced scrutiny by federal banking regulators based on its
concentration of commercial real estate loans. CRE loans generally include land development, construction loans, and loans secured by
multifamily property, and non-farm, nonresidential real property where the primary source of repayment is derived from rental income
associated with the property. Guidance from the federal banking regulators on the risk posed by CRE lending concentrations prescribes
guidelines for its examiners to help identify institutions that are potentially exposed to significant CRE risk. These guidelines include
concentrations in certain types of CRE that may warrant greater supervisory scrutiny: total reported loans for construction, land development,
and other land represent 100% or more of the institutions total capital; or total commercial real estate loans represent 300% or more of the
institution’s total capital, and the outstanding balance of the institution’s commercial real estate loan portfolio has increased by 50% or more in
the prior 36 months.
Volcker Rule: On December 10, 2013, the federal regulators adopted final regulations to implement the proprietary trading and private fund
prohibitions of the Volcker Rule under the Dodd-Frank Act. Under the final regulations, banking entities are generally prohibited, subject to
significant exceptions, from: (i) short-term proprietary trading as principal in securities and other financial instruments, and (ii) sponsoring or
acquiring or retaining an ownership interest in private equity and hedge funds. Revisions to the Volcker Rule in 2019, that become effective in
2020, simplified and streamlined the compliance requirements for banks that do not have significant trading activities. In 2020, the OCC, Federal
Reserve, FDIC, SEC and Commodity Futures Trading Commission finalized further amendments to the Volcker Rule. The amendments include
new exclusions from the Volcker Rule’s general prohibitions on banking entities investing in and sponsoring private equity funds, hedge funds,
and certain other investment vehicles (collectively “covered funds”). The amendments in the final rule, which became effective on October 1,
2020, clarify and expand permissible banking activities and relationships under the Volcker Rule.
Interchange Income: The Durbin Amendment to the Dodd-Frank Act capped debit card interchange fees for banks with over $10 billion in
assets. Interchange fees are paid to banks by merchants for processing transactions. The Durbin Amendment cap for a single debit card
transaction is 21 cents plus 5 basis points multiplied by the amount of the transaction. In addition, an issuer may receive up to 1 cent per
transaction for fraud prevention. The Durbin Amendment cap became effective for the Bank on July 1, 2022 and resulted in a reduction in
interchange income earned by the Bank. In October 2023, the Federal Reserve issued a proposed rule to lower the interchange fee cap to a level
that the Federal Reserve believes is reasonable and proportional to the cost incurred by card issuers. Under the proposal, the base cap would
decrease from 21 cents to 14.4 cents and from 5 basis points to 4 basis points. In addition, the fraud-prevention adjustment would increase from
1 cent to 1.3 cents. In January 2024, the Federal
11

Reserve announced it would extend the comment period from February 2024 to May 2024. We will continue to monitor for final rulemaking and
will evaluate the impact of any changes.
Corporate Governance and Risk Management: In September 2023, the FDIC issued proposed rulemaking to establish standards for corporate
governance and risk management for FDIC insured banks with total consolidated assets of $10 billion or more. The proposed guidelines would
set standards for corporate governance, risk management practices and board oversight. In establishing the proposed guidelines, the FDIC
considered the OCCs heightened standards for banks with total consolidated assets of $50 billion or more and the Federal Reserve’s enhanced
prudential standards for bank holding companies with total consolidated assets of $100 billion or more. We will continue to monitor for final
rulemaking and will evaluate the impact of any changes.
Governmental Policies
The operations of the Company and its subsidiaries are affected not only by general economic conditions, but also by the policies of various
regulatory authorities. In particular, the Federal Reserve regulates monetary policy and interest rates in order to influence general economic
conditions. These policies have a significant influence on overall growth and distribution of loans, investments and deposits and affect interest
rates charged on loans or paid for deposits. Federal Reserve monetary policies have had a significant effect on the operating results of all
financial institutions in the past and may continue to do so in the future.
Human Capital Management
We focus on creating an inclusive and transparent culture that celebrates teamwork and recognizes associates at all levels. We expect and
encourage participation and collaboration, and understand we need each other to be successful. We value accountability because it is essential to
our success, and we accept our responsibility to hold ourselves and others accountable for meeting shareholder commitments and achieving
exceptional standards of performance. We also believe in supporting our associates to prioritize their wellness.
Attracting and Retaining Talent. Our goal is to offer careers to our associates; not just jobs. At December 31, 2024, we employed 1,218 regular
full-time and 38 part-time associates. We also employ seasonal/temporary associates and occasionally hire independent contractors for specific
projects that require a highly specialized skill set or to provide additional resources during peak times, as needed.
Our performance measures and compensation determinations are designed to ensure the proper balance of risk and reward. Performance
evaluations facilitate our ongoing assessment of associates’ skills and improvements as needed. We use annual talent reviews to identify high-
performing associates and future potential leaders, provide insight into critical development needs and retention risks, and identify business-
critical talent needs, including anticipated workforce planning challenges. Additionally, we have established succession plans to ensure
continuation of essential roles and operations.
We are committed to offering a competitive total compensation package that is consistent with our principles and aligned with the Company’s
financial performance. We regularly compare compensation and benefits with peer companies and market data, making adjustments to
compensation as needed to ensure we remain competitive.
In addition to base salary, approximately 67% of associates are eligible to participate in the Company’s Short Term Incentive Plan (“STIP”)
program. Our STIP program is designed to align compensation with an associate’s performance in a given year. The program sets a performance
level of short-term incentive awards that an associate is eligible to earn. The STIP target is defined as a percentage of base salary based on the
associate’s grade level as determined by our Human Resources department.
As of January 1, 2025, our minimum wage is $17 per hour. The current minimum wage was instituted to maintain a competitive total rewards
package that attracts and retains top talent. The determination for our minimum wage was made after extensive research, including reviewing the
current market landscape both inside and outside of banking and financial services, and with feedback from leadership. Currently, 100% of our
associates earn more than the minimum wage.
12

We also offer a wide array of benefits for our associates and their families including 401(k), paid time off, parental leave, medical, dental and
vision benefits as well as life insurance and short-term disability for all full-time associates. Our wellness program offers financial rewards to
associates who adopt healthy habits and participate in wellness education and health screenings. Annual health screenings for associates and
spouses/domestic partners enrolled in our medical plans are provided to all associates at no charge.
Associate Feedback. We conduct associate surveys to ensure we understand what is important to our associates. The adoption of a volunteer
time-off policy and improvements to internal communication processes are examples of changes that have been made in response to survey
results. Our efforts are being recognized. For the past seven years, the Bank has been included in the “Best Banks to Work for” by American
Banker magazine for our dedication to employee satisfaction. In 2024, we were ranked fourth among similar financial institutions with more
than $10 billion in assets.
Belonging & Inclusion. We believe diversity of thought and experiences helps us build better teams and improve our client experience, results in
better outcomes, and empowers our associates to make more meaningful contributions within our company and communities. We have made
progress in this area, but continue to strive to further diversify our workforce and deepen our culture of inclusion.
Our Belonging & Inclusion Council is a management committee which provides information, ideas and insights from a variety of diverse
perspectives to help us foster an inclusive environment for our associates and the communities we serve. In addition, we have several associate
development programs that help to create a more inclusive environment by giving associates and other individuals of all backgrounds additional
opportunities to succeed and contribute. These programs include:
•
Career Acceleration Program - This trainee program introduces participants to the foundations of credit and commercial banking, while
allowing them to experience a wide range of assignments by rotating through the various product partners and operational areas of the
Company. Upon successful completion of the program, the associate is placed in a role that aligns with their strengths and talents and
helps meet the needs of our organization.
•
Gateway to a Banking Career - This program provides training for jobs as tellers and customer service representatives, job interview
practice and job placement assistance. It is a joint effort with two other St. Louis-based financial institutions. Upon successful
completion of the program, participants receive a small stipend and are guaranteed an interview with one of the program sponsors.
•
Business Resource Groups - These groups, which are open to all associates, bring together associates with a shared identity, interest or
goal to create community and opportunities for improvement and engagement.
Focusing on a Safe and Healthy Workplace. We value our associates and are committed to providing a safe and healthy workplace. Our formal
Health & Safety (“HS”) Policy mandates all tasks be conducted in a safe and efficient manner and comply with all local, state, and federal safety
and health regulations, and addresses special safety concerns. Our HS Policy encompasses all facilities and operations and addresses on-site
emergencies, injuries and illnesses, evacuation procedures, cell phone usage and general safety rules.
Additionally, our Business Continuity Plan is an important component in helping maintain the health and safety of our associates and clients.
Available Information
Various reports provided to the SEC, including our annual reports, quarterly reports, current reports, proxy statements, and amendments to such
reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are available free of charge on
our website at www.enterprisebank.com under the “Investor Relations” link. These reports are made available as soon as reasonably practicable
after they are electronically filed with or furnished to the SEC. Our filings with the SEC are also available on the SEC’s website at www.sec.gov.
All website addresses given in this document are for information only and are not intended to be an active link or to incorporate any website
information into this document.
13

ITEM 1A: RISK FACTORS
An investment in our common or depositary stock is subject to risks inherent to our business. Before making an investment decision, you should
carefully consider the risks and uncertainties described below together with all of the other information included or incorporated by reference in
this report. The value of our common and depositary stock could decline due to any of these risks, and you could lose all or part of your
investment.
Risks Relating to General Economic and Market Conditions
An economic downturn could adversely affect our financial condition, results of operations or cash flows.
Recessionary conditions and/or negative developments in the domestic and international credit markets may significantly affect the markets in
which we do business, the value of our loans and investments, and our ongoing operations and profitability. If the communities in which we
operate do not grow, or if prevailing economic conditions locally or nationally are unfavorable, our business may not succeed. Unpredictable
economic conditions may have an adverse effect on the quality of our loan portfolio and our financial performance. Adverse changes in the
economies in our market areas may have a material adverse effect on our financial condition, results of operations or cash flows. We bear
increased risk of unfavorable local economic conditions. Moreover, we cannot give any assurance we will benefit from any market growth or
favorable economic conditions in our primary market areas even if they do occur.
We face potential risk from changes in governmental monetary and fiscal policies.
Our earnings are affected by domestic economic conditions and the monetary and fiscal policies of the U.S. government and its agencies. The
Federal Reserve’s monetary policies have had, and are likely to continue to have, an important impact on the operating results of commercial
banks through its power to implement national monetary policy in order, among other things, to curb inflation or combat a recession. The
monetary policies of the Federal Reserve affect the levels of bank loans, investments, and deposits through its control over the issuance of U.S.
government securities, its regulation of the discount rate applicable to member banks, and its influence over reserve requirements to which
member banks are subject. Trade policy, including tariffs and potential trade wars, may affect our clients and the communities in which we
operate in unpredictable ways, which could negatively affect our result of operations or cash flows. We cannot predict the nature or impact of
future changes in monetary and fiscal policies.
Adverse developments affecting the banking industry, and resulting media coverage, have eroded customer confidence in the banking system and
could have a material effect on our operations and/or stock price.
The high-profile bank failures in the first quarter of 2023 generated significant market volatility among publicly traded bank holding companies
and, in particular, regional banks. In assessing the failures in 2023, the banking regulators noted that each of the failed banks had a high
proportion of deposits that exceeded FDIC deposit insurance limits. The industry has stabilized since these failures and the customer confidence
in the safety and soundness of smaller regional banks has improved considerably. Nevertheless, risks remain that customers may choose to
maintain deposits with larger financial institutions or invest in higher yielding short-term fixed income securities, all of which impacted our
liquidity, cost of funding, loan funding capacity, net interest margin, capital and results of operations. The high-profile bank failures of early
2023 highlighted the uncertainty and concern around advances in technology that increase the speed at which deposits can be moved, as well as
the speed and reach of media attention, including social media, and its ability to disseminate concerns or rumors, in each case potentially
exacerbating liquidity concerns. While the Department of the Treasury, the Federal Reserve, and the FDIC historically have ensured that
depositors of failed banks had access to their deposits, including uninsured deposit accounts, there is no guarantee that such actions will continue
to be successful in restoring customer confidence in regional banks and the banking system more broadly. In addition, the banking operating
environment and public trading prices of banking institutions can be highly correlated, in particular during times of stress, which could adversely
impact the trading prices of our common stock and potentially our results of operations.
Legal, Regulatory and Tax Risks
SBA lending is an important part of our business. Our SBA lending program is dependent upon the U.S. federal government, and we face specific
risks associated with originating SBA loans.
14

Our SBA lending program is dependent upon the U.S. federal government. As an approved participant in the SBA Preferred Lender’s Program (a
“Preferred Lender”), we enable our clients to obtain SBA loans without being subject to the potentially lengthy SBA approval process necessary
for lenders that are not Preferred Lenders. The SBA periodically reviews the lending operations of participating lenders to assess, among other
things, whether the lender exhibits prudent risk management. When weaknesses are identified, the SBA may request corrective actions or impose
enforcement actions, including revocation of the Preferred Lender status. If we lose our status as a Preferred Lender, we may lose some or all of
our customers to lenders who are Preferred Lenders, and as a result we could experience a material adverse effect to our financial results. Any
changes to the SBA program, including but not limited to, changes to the level of guarantee provided by the federal government on SBA loans,
changes to program-specific rules impacting volume eligibility under the guaranty program, as well as changes to the program amounts
authorized by Congress, may also have a material adverse effect on our business. In addition, any default by the U.S. government on its
obligations or any prolonged government shutdown could, among other things, impede our ability to originate SBA loans or sell such loans in
the secondary market, which could materially adversely affect our business, results of operations, and financial condition. When we originate
SBA loans, we incur credit risk on the non-guaranteed portion of the loans, and if a customer defaults on a loan, we share any loss and recovery
related to the loan pro-rata with the SBA. If the SBA establishes that a loss on an SBA guaranteed loan is attributable to significant technical
deficiencies in the way the loan was originated, funded, or serviced by us, the SBA may seek recovery of the principal loss related to the
deficiency.
Changes in government regulation and supervision may increase our costs or impact our ability to operate in certain lines of business.
Our operations are subject to extensive regulation by federal, state and local governmental authorities and are subject to various laws and judicial
and administrative decisions imposing requirements and restrictions on part or all of our operations. Banking regulations are primarily intended
to protect depositors’ funds, federal deposit insurance funds and the banking system as a whole, rather than shareholders. Because our business is
highly regulated, the laws, rules, regulations and supervisory guidance and policies applicable to us are subject to regular modification and
change, including as a result of changes in U.S. presidential administrations that have different regulatory agendas, and could result in an adverse
impact on our results of operations.
We are subject to numerous laws designed to protect consumers, including the CRA and fair lending laws, and failure to comply with these laws
could lead to a wide variety of sanctions.
The CRA, the Equal Credit Opportunity Act, the Fair Housing Act and other fair lending laws and regulations impose nondiscriminatory lending
requirements on financial institutions. The CFPB, the U.S. Department of Justice and other federal agencies are responsible for enforcing these
laws and regulations. A successful regulatory challenge to an institution’s performance under the CRA or fair lending laws and regulations could
result in a wide variety of sanctions, including damages and civil monetary penalties; injunctive relief; and restrictions on mergers and
acquisitions activity, expansion, and new business lines. Private parties may also have the ability to challenge an institution’s performance under
fair lending laws in private class action litigation. Such actions could have a material adverse effect on our business, financial condition, results
of operations and future prospects.
We are subject to compliance with the Bank Secrecy Act and other anti-money laundering statutes and regulations, and failure to comply with
these laws could lead to a wide variety of sanctions.
The Bank Secrecy Act, the USA PATRIOT Act, and other laws and regulations require financial institutions, among other duties, to institute and
maintain an effective anti-money laundering program and file suspicious activity and currency transaction reports when appropriate. In addition
to other bank regulatory agencies, the federal Financial Crimes Enforcement Network of the Department of the Treasury is authorized to impose
significant civil money penalties for violations of those requirements and engages in coordinated enforcement efforts with the state and federal
banking regulators, as well as the U.S. Department of Justice, CFPB, Drug Enforcement Administration, and Internal Revenue Service. We are
also subject to compliance with the rules enforced by the Office of Foreign Assets Control of the Department of the Treasury regarding, among
other things, the prohibition of transacting business with, and the need to freeze assets of, certain persons and organizations identified as a threat
to the national security, foreign policy or economy of the United States. If our policies, procedures and systems are deemed deficient, we would
be subject to liability, including fines and regulatory actions, which may include restrictions on our ability to
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pay dividends and the necessity to obtain regulatory approvals to proceed with certain aspects of our business plan, including any acquisition
plans. Failure to maintain and implement adequate programs to combat money laundering and terrorist financing could also have serious
reputational consequences for us. Any of these results could have a material adverse effect on our business, financial condition, results of
operations and future prospects.
If the Company or the Bank incur losses that erode its capital, it may become subject to enhanced regulation or supervisory action.
Under federal and state laws and regulations pertaining to the safety and soundness of insured depository institutions, the Missouri Division of
Finance, the Federal Reserve, and the FDIC have the authority to compel or restrict certain actions if the Company’s or the Bank’s capital should
fall below adequate capital standards. Among other matters, the corrective actions include but are not limited to requiring affirmative action to
correct any conditions resulting from any violation or practice; directing an increase in capital and the maintenance of specific minimum capital
ratios; restricting the Bank’s operations; limiting the interest rate the Bank may pay on brokered deposits; restricting the amount of distributions
and dividends and payment of interest on its trust preferred securities; requiring the Bank to enter into informal or formal enforcement orders,
including memoranda of understanding, written agreements and consent or cease and desist orders to take corrective action and enjoin unsafe
and unsound practices; removing officers and directors and assessing civil monetary penalties; and taking possession of and closing and
liquidating the Bank. These actions may limit the ability of the Bank or Company to execute its business plan and thus can lead to an adverse
impact on the results of operations or financial position.
Financial Risks
Our business is subject to interest rate risk and variations in interest rates may negatively affect our financial performance.
A substantial portion of our income is derived from the differential or “spread” between the interest earned on loans, investment securities, and
other interest-earning assets, and the interest and/or earnings credit paid on deposits, borrowings, and other interest-bearing liabilities. Because
of the differences in the maturities and repricing characteristics of our interest-earning assets and interest-bearing liabilities, changes in interest
rates may not produce equivalent changes in income earned on interest-earning assets and expense paid on interest-bearing liabilities. Our assets
and liabilities may react differently to changes in overall interest rates or conditions. Significant fluctuations in market interest rates could
materially and adversely affect not only our net interest spread, but also our asset quality and loan origination volume, deposits, funding
availability, and/or net income.
Our allowance for credit losses may not be adequate to cover actual loan losses.
We maintain an allowance for credit losses, which is a reserve established through a provision for credit losses charged to expense, that
represents management’s estimate of probable losses within the existing loan portfolio. The allowance, in the judgment of management, is
sufficient to reserve for estimated credit losses and risks inherent in the loan portfolio. We continue to monitor the adequacy of our loan credit
allowance and may need to increase it if economic conditions or other factors deteriorate. In addition, bank regulatory agencies periodically
review our allowance for credit losses and may require an increase in the provision for credit losses or the recognition of further loan charge-offs,
based on judgments that can differ somewhat from those of our own management. In addition, if charge-offs in future periods exceed the
allowance for credit losses (i.e., if the allowance for credit losses is inadequate), we may need additional credit loss provisions to increase the
allowance for loan losses. Additional provisions to increase the allowance for credit losses, should they become necessary, would result in a
decrease in net income and a reduction in capital, and may have a material adverse effect on our financial condition and results of operations.
We may not be able to maintain our historical rate of growth or profitability, which could have a material adverse effect on our ability to
successfully implement our business strategy.
Successful growth requires that we follow adequate loan underwriting standards, balance loan and deposit growth without increasing interest rate
risk or compressing our net interest margin, maintain adequate capital at all times, produce investment performance results competitive with our
peers and benchmarks, further diversify our revenue sources, meet the expectations of our clients and hire and retain qualified employees. If we
do not manage our growth successfully, then our business, results of operations or financial condition may be adversely affected.
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We may incur impairments to goodwill.
As of December 31, 2024, we had $365 million recorded as goodwill. We evaluate our goodwill for impairment at least annually. Significant
negative industry or economic trends, including a sustained decrease in the market price of our common stock, or reduced future cash flows or
disruptions to our business, could result in impairments to goodwill. Our valuation methodology for assessing impairment requires management
to make judgments and assumptions based on experience and to rely on projections of future operating performance. We operate in competitive
environments and projections of future operating results and cash flows may vary significantly from actual results. If our analysis results in
impairment to goodwill, we would be required to record an impairment charge to earnings in our financial statements during the period in which
such impairment is determined to exist. Any such change could have a material adverse effect on our results of operations and stock price.
Declines in asset values may result in impairment charges and adversely impact the value of our investments and our financial performance and
capital.
We hold an investment portfolio that includes, but is not limited to, municipal bonds, corporate debt securities, government securities and agency
mortgage-backed securities. Factors beyond our control can significantly influence the fair value of securities in our portfolio and can cause
potential adverse changes to the fair value of these securities. These factors include, but are not limited to, rating agency actions in respect to the
securities, defaults by the issuer or with respect to the underlying securities, changes in market interest rates and/or spread, and instability and
other factors impacting the capital markets. Any of these factors, among others, could cause realized or unrealized losses in future periods and
declines in other comprehensive income (loss), which could have a material adverse effect on our business, results of operations, financial
condition and future prospects. The process for determining the impairment of a security often requires complex, subjective judgments about
whether there has been significant deterioration in the financial condition of the issuer, whether management has the intent or ability to hold a
security for a period of time sufficient to allow for any anticipated recovery in fair value, the future financial performance and liquidity of the
issuer and any collateral underlying the security and other relevant factors.
We invest in mortgage-backed obligations and such obligations have been, and are likely to continue to be, impacted by market dislocations,
declining home values and prepayment risk, which may lead to volatility in cash flow and market risk and declines in the value of our investment
portfolio.
Our investment portfolio includes mortgage-backed obligations primarily secured by pools of mortgages on single-family residences. The value
of mortgage-backed obligations in our investment portfolio may fluctuate for several reasons, including (i) delinquencies and defaults on the
mortgages underlying such obligations, due in part to high unemployment rates, (ii) falling home prices, (iii) lack of a liquid market for such
obligations, and (iv) uncertainties in respect of government-sponsored enterprises such as the Federal National Mortgage Association or the
Federal Home Loan Mortgage Corporation, which guarantee such obligations. If the value of homes were to materially decline, the fair value of
the mortgage-backed obligations in which we invest may also decline. Any such decline in the fair value of mortgage-backed obligations, or
perceived market uncertainty about their fair value, could adversely affect our financial position and results of operations. In addition, when we
acquire a mortgage-backed security, we anticipate the underlying mortgages will prepay at a projected rate, thereby generating an expected yield.
Prepayment rates generally increase as interest rates fall and decrease when rates rise, but changes in prepayment rates are difficult to predict. At
the time of purchase, some of our mortgage-backed securities had a higher interest rate than prevailing market rates, resulting in a premium
purchase price. In accordance with applicable accounting standards, we amortize the premium over the expected life of the mortgage-backed
security. If the mortgage loans securing the mortgage-backed security prepay more rapidly than anticipated, we would have to amortize the
premium on an accelerated basis, which would thereby adversely affect our profitability.
Credit and Liquidity Risks
Our loan and deposit portfolios are in certain markets which could result in increased concentration risk.
A majority of our loans are to businesses and individuals in the St. Louis, Kansas City, Phoenix, Los Alamos, Albuquerque, Santa Fe, Los
Angeles, San Diego, Dallas, and Las Vegas metropolitan areas. These loans are funded by deposits in the same metropolitan areas, in addition to
our national deposit verticals. The regional economic
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conditions in areas where we conduct our business have an impact on the demand for our products and services as well as the ability of our
clients to repay loans, the value of the collateral securing loans, and the stability of our deposit funding sources. Consequently, a decline in local
economic conditions may adversely affect our earnings. The proportion of our deposit account balances that exceed FDIC insurance limits may
also expose the Company to enhanced liquidity risk in times of financial distress.
There are material risks involved in commercial lending that could adversely affect our business.
Our business plan calls for continued efforts to increase our assets invested in commercial loans. Our commercial loans include loans secured by
real estate (commercial property, construction and land and multi-family residential property). Commercial loans generally involve a higher
degree of credit risk than residential mortgage loans due, in part, to their larger average size and less marketable collateral. In addition, unlike
residential mortgage loans, commercial loans generally depend on the cash flow of the borrower’s business to service the debt. Adverse
economic conditions or other factors affecting our target markets may have a greater adverse effect on us than on other financial institutions that
have a more diversified client base. Increases in non-performing commercial loans could result in operating losses, impaired liquidity and
erosion of our capital, and could have a material adverse effect on our financial condition and results of operations. Credit market tightening
could adversely affect our commercial borrowers through declines in their business activities and adversely impact their overall liquidity through
the diminished availability of other borrowing sources or otherwise.
The ability of our borrowers to repay their loans may be adversely affected by an increase in market interest rates which could result in
increased credit losses. These increased credit losses, where the Bank has retained credit exposure, could decrease our assets, net income and
available cash.
The loans we make to our borrowers often bear interest at a variable interest rate. When market interest rates increase, the amount of revenue
borrowers need to service their debt also increases. Some borrowers may be unable to make their debt service payments. As a result, an increase
in market interest rates may increase the risk of loan default. An increase in non-performing loans could result in a net loss of earnings from
these loans, an increase in the provision for credit losses, and an increase in loan charge-offs, all of these factors could impact allowance,
earnings and/or capital levels.
Our loan portfolio includes loans secured by real estate, which could result in increased credit risk.
A portion of our portfolio is secured by real estate, and thus we face a high degree of risk from a downturn in our real estate markets. If real
estate values decline in our markets, our ability to recover on defaulted loans for which the primary reliance for repayment is on the real estate
collateral by foreclosing and selling that real estate would then be diminished, and we would be more likely to suffer losses on defaulted loans.
Additionally, the state-specific foreclosure laws of the jurisdictions in which our real estate collateral is located may hinder our ability to timely
or fully recover on defaulted loans secured by property in certain states. For example, some states in which our collateral is located are judicial
foreclosure states. In judicial foreclosure states, all foreclosures must be processed through the court system. Due to this process, it may take up
to a year or longer to foreclose on real estate collateral located in those states. Our ability to recover on defaulted loans secured by property in
those states may be delayed and our recovery efforts are lengthened due to this process. In addition, some states have anti-deficiency statutes
with regards to certain types of residential mortgage loans. Our ability to recover on defaulted loans secured by residential mortgages in anti-
deficiency statute states may be limited to the fair value of the real estate securing the loan at the time of foreclosure.
Our commercial and industrial loans and sponsor finance loans are underwritten based primarily on cash flow, profitability and enterprise value
of the client and are not fully covered by the value of tangible assets or collateral of the client. Consequently, if any of these transactions
becomes non-performing, we could experience significant losses.
Cash flow lending involves lending money to a client based primarily on the expected cash flow, profitability and enterprise value of a client,
with the value of any tangible assets as secondary protection. In some cases, these loans may have more leverage than traditional bank debt. In
the case of our senior cash flow loans, we generally take a lien on substantially all of a client’s assets, but the value of those assets is typically
substantially less than the
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amount of money we advance to the client under a cash flow transaction. In addition, some of our cash flow loans may be viewed as stretch
loans, meaning they may be at leverage multiples that exceed traditional accepted bank lending standards for senior cash flow loans. Thus, if a
cash flow transaction becomes non-performing, our primary recourse to recover some or all of the principal of our loan or other debt product
would be to force the sale of all or part of the company as a going concern. Additionally, we may obtain equity ownership in a borrower as a
means to recover some or all of the principal of our loan. The risks inherent in cash flow lending include, among other things:
•
reduced use of or demand for the client’s products or services and, thus, reduced cash flow of the client to service the loan and other debt
product as well as reduced value of the client as a going concern;
•
inability of the client to manage working capital, which could result in lower cash flow;
•
inaccurate or fraudulent reporting of our client’s positions or financial statements; and
•
our client’s poor management of their business.
Additionally, many of our clients use the proceeds of our cash flow transactions to make acquisitions. Poorly executed or poorly conceived
acquisitions can burden management, systems and the operations of the existing business, causing a decline in both the client’s cash flow and the
value of its business as a going concern. In addition, many acquisitions involve new management teams taking over day-to-day operations of a
business. These new management teams may fail to execute at the same level as the former management team, which could reduce the cash flow
of the client available to service the loan or other debt product, as well as reduce the value of the client as a going concern.
Widespread financial difficulties or downgrades in the financial strength or credit ratings of life insurance providers could lessen the value of the
collateral securing our life insurance premium finance loans and impair our financial condition and liquidity.
One of the specialized products we offer is financing whole life insurance premiums utilized in high net worth estate planning. These loans are
primarily secured by the insurance policies financed by the loans, i.e., the obligations of the life insurance providers under those policies.
Nationally Recognized Statistical Rating Organizations (“NRSROs”) such as Standard & Poor’s, Moody’s and A.M. Best evaluate the life
insurance providers that are the payors on the life insurance policies that we finance. The value of our collateral could be materially impaired in
the event there are widespread financial difficulties among life insurance providers or the NRSROs downgrade the financial strength ratings or
credit ratings of the life insurance providers, indicating the NRSROs’ opinion is the life insurance provider’s ability to meet policyholder
obligations is impaired, or the ability of the life insurance provider to meet the terms of its debt obligations is impaired. The value of our
collateral is also subject to the risk a life insurance provider could become insolvent. In particular, if one or more large nationwide life insurance
providers were to fail, the value of our portfolio could be significantly negatively impacted. A significant downgrade in the value of the collateral
supporting our premium finance business could impair our ability to create liquidity for this business, which, in turn, could negatively impact our
ability to expand.
Our construction and land development loans are based upon estimates of costs and value associated with the completed project. These
estimates may be inaccurate and we may be exposed to more losses on these projects than on other loans.
Construction, land acquisition and development lending involves additional risks because funds are advanced based upon the projected value of
the project, which is inherently uncertain prior to the project’s completion. Because of the uncertainties inherent in estimating construction costs,
as well as the fair value of the completed project and the effects of governmental regulation of real property and the general effects of the
national and local economies, it is relatively difficult to evaluate accurately the total funds required to complete a project and the related loan-to-
value ratio. As a result, construction loans often involve the disbursement of substantial funds with repayment dependent, in part, on the success
of the ultimate project and the ability of the borrower to sell or lease the property, rather than the ability of the borrower or guarantor to repay
principal and interest. If our appraisal of the value of the completed project proves to be overstated, we may have inadequate security for the
repayment of the loan upon completion of construction of the project. If we are forced to foreclose on a project prior to or at completion due to a
default, there can be no assurance we will be able to recover all of the unpaid balance of, and accrued interest on, the loan or the related
foreclosure, sale and holding costs. In addition, we may be required to fund additional amounts to complete
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the project and may have to hold the property for an unspecified period of time. If any of these events occur, our financial condition, results of
operations and cash flows could be materially and adversely affected.
We are subject to environmental risks associated with owning real estate or collateral.
When a borrower defaults on a loan secured by real property, we may purchase the property in foreclosure or accept a deed to the property
surrendered by the borrower. We may also take over the management of commercial properties whose owners have defaulted on loans. We may
also own and lease premises where branches and other facilities are located. While we have lending, foreclosure and facilities guidelines
intended to exclude properties with an unreasonable risk of contamination, hazardous substances could exist on some of the properties we may
own, manage or occupy. We face the risk that environmental laws could force us to clean up the properties at our expense. The cost of cleaning
up or paying damages and penalties associated with environmental problems could increase our operating expenses. It may cost more to clean a
property than the property is worth. We could also be liable for pollution generated by a borrower’s operations if we take a role in managing
those operations after a default. The Company may also find it difficult or impossible to sell these properties.
We may be obligated to indemnify certain counterparties in financing transactions we enter into pursuant to the New Markets Tax Credit
Program.
We participate in and have previously been an “Allocatee” of the New Markets Tax Credit Program of the U.S. Department of the Treasury
Community Development Financial Institutions Fund. Through this program, we provide our allocation to certain projects, which in turn for an
equity investment from an investor in the project generate federal tax credits to those investors. This equity, coupled with any debt or equity from
the project sponsor is in turn invested in a certified community development entity for a period of at least seven years. Community development
entities must use this capital to make loans to, or other investments in, qualified businesses in low-income communities in accordance with New
Markets Tax Credit Program criteria. Investors receive an overall tax credit equal to 39% of their qualified equity investment, credited at a rate of
five percent in each of the first three years and six percent in each of the final four years. However, after the exhaustion of all cure periods and
remedies, the entire credit is subject to recapture if the certified community development entity fails to maintain its certified status, or if
substantially all of the equity investment proceeds associated with the tax credits we allocate are no longer continuously invested in a qualified
business that meets the New Markets Tax Credit Program criteria, or if the equity investment is redeemed prior to the end of the minimum seven-
year term. As part of these financing transactions, we as the parent to Enterprise Financial CDE, LLC, provide customary indemnities to the tax
credit investors, which require us to indemnify and hold harmless the investors in the event a credit recapture event occurs, unless the recapture
is a result of action or inaction of the investor. No assurance can be given that these counterparties will not call upon us to discharge these
obligations in the circumstances under which they are owed. If this were to occur, the amount we may be required to pay a bank investor could
be substantial and could have a material adverse effect on our results of operations and financial condition.
If we fail to comply with requirements of the federal New Markets Tax Credit program, the U.S. Department of the Treasury Community
Development Financial Institutions Fund could seek any remedies available under its Allocation Agreement with us, and we could suffer
significant reputational harm and be subject to greater scrutiny from banking regulators.
Because we have been designated as an “Allocatee” under the New Markets Tax Credit Program, we are required to provide allocation fund
qualifying projects under the New Markets Tax Credit Program, and we are responsible for monitoring those projects, ensuring their ongoing
compliance with the requirements of the New Markets Tax Credit Program and satisfying the various recordkeeping and reporting requirements
under the New Markets Tax Credit Program. If we default in our obligations under the New Markets Tax Credit Program, the U.S. Department of
the Treasury may revoke our participation in any other CDFI Fund programs, reallocate the New Market Tax Credits that were originally
allocated to us, and take any other remedial actions that it is empowered to take under the Allocation Agreement they have entered into with us
with respect to the New Markets Tax Credit Program, with the full range of such remedies being unknown. If we were to default under the New
Markets Tax Credit Program, we could suffer negative publicity in the communities in which we operate, and we could face greater scrutiny
from federal and state bank regulators, especially with regard to our compliance with the CRA. These developments could have a material
adverse impact on our reputation, business, and financial condition.
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Liquidity risk could impair our ability to fund operations and meet debt coverage obligations, and jeopardize our financial condition.
Liquidity is essential to our business. We are a holding company and depend on our subsidiaries for liquidity needs, including debt coverage
requirements.  An inability to raise funds through deposits, borrowings, the sale of investment securities and other sources could have a
substantial material adverse effect on our liquidity. Our access to funding sources in amounts that are adequate to finance our activities could be
impaired by factors that affect us specifically or the financial services industry in general. Factors that could detrimentally impact our access to
liquidity sources include, but are not limited to, a decrease in the level of our business activity due to a market downturn, our failure to remain
well-capitalized, or adverse regulatory action against us. Our ability to acquire deposits or to borrow could also be impaired by factors that are
not specific to us, such as a severe disruption of the financial markets or negative views and expectations about the prospects for the financial
services industry as a whole.
Our utilization of brokered deposits could adversely affect our liquidity and results of operations.
Since our inception, we have utilized both brokered and non-brokered deposits as a source of funds to support our growing loan demand and
other liquidity needs. As a bank regulatory supervisory matter, reliance upon brokered deposits as a significant source of funding is discouraged.
Brokered deposits may not be as stable as other types of deposits, and, in the future, those depositors may not renew their deposits when they
mature, or we may have to pay a higher rate of interest to keep those deposits or may have to replace them with other deposits or with funds from
other sources. Additionally, if the Bank ceases to be categorized as “well-capitalized” for bank regulatory purposes, it would not be able to
accept, renew or roll over brokered deposits without a waiver from the FDIC. Our inability to maintain or replace these brokered deposits as they
mature could adversely affect our liquidity and results of operations. Further, paying higher interest rates to maintain or replace these deposits
could adversely affect our net interest margin and results of operations.
In 2024, the FDIC issued a proposed rule that would revise the FDIC’s regulations governing the classification and treatment of brokered
deposits. If the proposed rule is finalized as proposed, the Company may be required to classify certain deposits as brokered deposits. Among
other changes, this may increase deposit insurance assessments and impact liquidity metrics.
By engaging in derivative transactions, we are exposed to additional credit and market risk in our banking business.
We use interest rate swaps to help manage our interest rate risk in our banking business from recorded financial assets and liabilities when they
can be demonstrated to effectively hedge a designated asset or liability and the asset or liability exposes us to interest rate risk or risks inherent in
client related derivatives. We may use other derivative financial instruments to help manage other economic risks, such as liquidity and credit
risk, including exposures that arise from business activities that result in the receipt or payment of future known or uncertain cash amounts, the
value of which are determined by interest rates. We also have derivatives that result from a service we provide to certain qualifying clients
approved through our credit process and therefore, these derivatives are not used to manage interest rate risk in our assets or liabilities. We do not
enter into derivative financial instruments for trading purposes. Hedging interest rate risk is a complex process, requiring sophisticated models
and routine monitoring. As a result of interest rate fluctuations, hedged assets and liabilities will appreciate or depreciate in market value. The
effect of this unrealized appreciation or depreciation will generally be offset by income or loss on the derivative instruments that are linked to the
hedged assets and liabilities. By engaging in derivative transactions, we are exposed to credit and market risk. If the counterparty fails to
perform, credit risk exists to the extent of the fair value gain in the derivative. Market risk exists to the extent that interest rates change in ways
that are significantly different from what we expected when we entered into the derivative transaction. The existence of credit and market risk
associated with our derivative instruments could adversely affect our net interest income and, therefore, could have a material adverse effect on
our business, financial condition, results of operations and future prospects.
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Competitive and Reputational Risks
The loss of any of our executive officers or other key employees, or the inability to recruit highly skilled and other key employees, may adversely
affect our operations.
We believe our growth and continued success will depend in large part on our executive team and other key employees. The loss of any of our
executive officers or other key employees, the failure to successfully transition key roles, or the inability to hire, train, retain, and manage
qualified personnel, could have a material adverse effect on our business strategy, financial condition, results of operations and cash flows.
We face significant competition.
The financial services industry, including, but not limited to, commercial banking, mortgage banking, consumer lending, and home equity
lending, is highly competitive, and we encounter strong competition for deposits, loans, and other financial services in all of our market areas in
each of our lines of business. Our principal competitors include other commercial banks, savings banks, savings and loan associations, mutual
funds, money market funds, finance companies, trust companies, technology companies, insurers, credit unions, and mortgage companies among
others. Many of our non-bank competitors are not subject to the same degree of regulation as us and have advantages over us in providing certain
services. Many of our competitors are significantly larger than we are and have greater access to capital and other resources. Also, our ability to
compete effectively in our business is dependent on our ability to adapt successfully to regulatory and technological changes within the banking
and financial services industry, generally. If we are unable to compete effectively, we will lose market share and our income from loans and other
products may diminish.
Our ability to compete successfully depends on a number of factors, including, among other things:
•
the ability to develop, maintain, and build upon long-term client relationships based on top quality service and high ethical standards;
•
the scope, relevance, and pricing of products and services, including technological innovations to those products and services, offered to
meet client needs and demands;
•
the rate at which we introduce new products and services relative to our competitors;
•
client satisfaction with our level of service; and/or
•
industry and general economic trends.
Failure to perform in any of these areas could significantly weaken our competitive position, and could adversely affect our growth and
profitability, which, in turn, could have a material adverse effect on our financial condition and results of operations.
Technology is continually changing and we must effectively implement new innovations in providing services to our clients.
The financial services sector is rapidly evolving due to technological innovations, with breakthroughs in areas like artificial intelligence, cloud
computing, and other emerging technologies continuously producing new products and services to better serve their clients. In addition to better
serving clients, the effective use of technology increases our efficiency and enables us to reduce costs. Our future success will depend, in part,
upon our ability to address the needs of our clients using innovative methods, processes and technology to provide products and services that will
satisfy client demands for convenience as well as to add efficiencies in our operations as we continue to grow and expand our market areas.
Many national vendors provide turn-key services to community banks, such as Internet banking and remote deposit capture, that allow smaller
banks to compete with institutions that have substantially greater resources to invest in technological improvements. We may not be able,
however, to effectively implement new technology-driven products and services or be successful in marketing these products and services to our
clients.
Costs and levels of deposits are affected by competition that could increase our funding costs or liquidity risk.
We rely on bank deposits to be a low cost and stable source of funding. We compete with banks and other financial services companies for
deposits. If our competitors raise the rates they pay on deposits, our funding costs may increase, either because we raise our rates to avoid losing
deposits or because we lose deposits and must rely on more expensive sources of funding. Higher funding costs could reduce our net interest
margin and net interest income and could have a material adverse effect on our business, financial condition and results of operations.
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Acquisition Risks
We have engaged in and may continue to engage in expansion through acquisitions, and these acquisitions present a number of risks related both
to the acquisition transactions and to the integration of the acquired businesses.
The acquisition of other financial services companies or assets present risks to us in addition to those presented by the nature of the business
acquired. Our earnings, financial condition, and prospects after a merger or acquisition depend in part on our ability to successfully integrate the
operations of the acquired company. We may be unable to integrate operations successfully or to achieve expected results or cost savings.
Acquiring other banks or businesses involves various risks commonly associated with acquisitions, including, among other things:
•
potential exposure to unknown or contingent liabilities of the target company;
•
exposure to potential asset quality issues of the target company;
•
difficulty and expense of integrating the operations and personnel of the target company;
•
potential disruption to our business;
•
potential diversion of our management’s time and attention;
•
the possible loss of key employees and clients of the target company;
•
difficulty in estimating the value of the target company;
•
payment of a premium over book and market values that may dilute our tangible book value and earnings per share in the short- and
long-term;
•
inability to realize the expected revenue increases, cost savings, increases in geographic or product presence, and/or other projected
benefits; and/or
•
potential changes in banking or tax laws or regulations that may affect the target company.
We periodically evaluate merger and acquisition opportunities and conduct due diligence activities related to possible transactions with other
financial institutions and financial services companies. As a result, merger or acquisition discussions and, in some cases, negotiations may take
place, and future mergers or acquisitions involving cash, debt or equity securities may occur at any time. In addition to the risks noted above,
potential acquisitions may incur additional costs for diligence or break-up fees, even if the transaction is not consummated.
We may be unable to successfully integrate new business lines into our existing operations.
From time to time, we may implement other new lines of business or offer new products or services within existing lines of business. There can
be substantial risks and uncertainties associated with these efforts, particularly in instances where the markets are not fully developed. Although
we continue to expend substantial managerial, operating and financial resources as our business grows, we may be unable to successfully
continue the integration of new business lines, and price and profitability targets may not prove feasible. External factors such as compliance
with regulations, competitive alternatives and shifting market preferences, may also impact the successful implementation of a new line of
business or a new product or service. Furthermore, any new line of business and new product or service could have a significant impact on the
effectiveness of our system of internal controls. Failure to successfully manage these risks in the development and implementation of new lines
of business or new products or services could have a material adverse effect on our business, financial condition and results of operations.
As we expand outside our current markets, we may encounter additional risks that may adversely affect us.
We are headquartered in Missouri, but have branch locations in the Kansas City, Phoenix, Los Angeles, and San Diego metropolitan areas, as
well as Northern New Mexico, Florida and Nevada. Over time, we may acquire or open locations in other parts of the United States as well. In
the course of these expansion activities, we may encounter significant risks, including unfamiliarity with the characteristics and business
dynamics of new markets, increased marketing and administrative expenses and operational difficulties arising from our efforts to attract
business in new markets, manage operations in noncontiguous geographic markets, comply with local laws and regulations and effectively and
consistently manage personnel and business outside of the State of Missouri. If we are unable to manage these risks, our operations may be
materially and adversely affected.
23

Technology and Cybersecurity Risks
A failure in or breach, or the inability to recognize a potential breach of our operational or security systems, or those of our third party service
providers, including as a result of cyber-attacks, may cause industry-wide operational disruptions that could materially affect our business,
result in unintentional disclosure or misuse of confidential or proprietary information, damage our reputation, increase our costs and adversely
impact our earnings.
Information security, including cybersecurity, is a high priority for us. Recent highly publicized material events have highlighted the importance
of cybersecurity, including cyberattacks against other financial institutions, governmental agencies, and other organizations that resulted in the
compromise of personal and/or confidential information, the theft or destruction of corporate information, and demands for ransom payments to
release corporate information encrypted by “ransomware.” A successful cyberattack could materially and adversely affect the Bank’s reputation
and/or impair its ability to provide services to its clients. As risks associated with cybersecurity threats have and continue to evolve and become
more sophisticated, including as a result of artificial intelligence, we have expended, and may in the future expend, significant resources to
implement technologies and various response and recovery plans and procedures as part of our information security program. Additionally, we
face the risk of operational disruption, failure, termination or capacity constraints of any of the third parties that facilitate our business activities,
including exchanges, clearing agents, clearing houses or other financial intermediaries. Such parties could also be the source of an attack on, or
breach of, our operational systems. Any material failures, interruptions or security breaches in our information systems could damage our
reputation, result in a loss of client business, result in a violation of privacy or other laws, or expose us to civil litigation, regulatory fines or
losses not covered by insurance.
We rely on third-party vendors to provide key components of our business infrastructure.
We rely heavily on third-party service providers for much of our communications, information, operating and financial control systems
technology, including relationship management, mobile banking, general ledger, investment, deposit, loan servicing and loan origination
systems. While we have selected these third-party vendors carefully and perform ongoing monitoring, we do not control their actions. Any
problems caused by these third parties, including as a result of inadequate or interrupted service, could materially affect our ability to
successfully deliver products and services to our clients and otherwise conduct our business. Financial or operational difficulties of a third-party
vendor could also hurt our operations if those difficulties interfere with the vendor’s ability to serve us, and replacing these third-party vendors
could result in significant delay and expense. Accordingly, use of such third parties creates an unavoidable inherent risk to our business
operations as well as reputational risk.
Our core operating system conversion may result in business interruptions or other adverse developments.
On October 11, 2024, we replaced our core operating systems, including those for loans, deposits, financials and other ancillary systems
(collectively referred to as “core system”). We use the core system to track client relationships and accounts and report financial information.
The core system is integrated with various other applications that are used to service client requests by Bank personnel or directly by clients
(such as online and mobile banking). Changing the core system subjects us to operational risks, including disruptions to technology systems,
which may adversely impact our clients. We have documented plans, policies and procedures designed to prevent or limit the risks of a failure
during and after the conversion of our core system. However, there can be no assurance that any such adverse developments will not occur or, if
they do occur, that they will be timely and adequately remediated. The ultimate impact of any adverse development could damage our reputation,
result in a loss of client business, subject us to regulatory scrutiny, or expose it to civil litigation and possibly financial liability, any of which
could have a material effect on our business, financial condition, and results of operations.
Risks Relating to Our Common Stock and Depositary Shares
The price of our common stock and depositary shares may be volatile or may decline.
The trading price of our common stock and depositary shares may fluctuate widely as a result of a number of factors, many of which are outside
our control. In addition, the stock market is subject to fluctuations in the share prices and trading volumes that affect the market prices of the
shares of many companies. These broad market fluctuations could make it more difficult for you to resell your common stock or depositary
shares when you want and at prices you find attractive.
24

Our stock price and the price of our depositary shares can fluctuate significantly in response to a variety of factors including, among other things:
•
actual or anticipated quarterly fluctuations in our operating results and financial condition;
•
changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts;
•
reputation;
•
failure to meet analysts’ revenue or earnings estimates;
•
speculation in the press or investment community;
•
strategic actions by us or our competitors, such as acquisitions or restructurings;
•
actions by institutional shareholders;
•
fluctuations in the stock prices and operating results of our competitors;
•
general market conditions and, in particular, developments related to market conditions for the financial services industry;
•
proposed or adopted regulatory changes or developments;
•
anticipated or pending investigations, proceedings or litigation that involve or affect us; and/or
•
domestic and international economic factors unrelated to our performance.
The stock market and, in particular, the market for financial institution stocks, has historically experienced significant volatility. As a result, the
market price of our common stock and depositary shares may be volatile. In addition, the trading volume in our common stock and depositary
shares may fluctuate more than usual and cause significant price variations to occur. The trading price of the shares of our common stock and our
depositary shares and the value of our other securities will depend on many factors, which may change from time to time, including, without
limitation, our financial condition, performance, creditworthiness and prospects, future sales of our equity or equity related securities, and other
factors identified in this annual report and our other reports. In some cases, the markets have produced downward pressure on stock prices and
credit availability for certain issuers without regard to those issuers’ underlying financial strength or operating results. A significant decline in
our stock or depositary share prices could result in substantial losses for individual shareholders and could lead to costly and disruptive securities
litigation.
The trading volume in our common stock and depositary shares is less than that of other larger financial institutions.
Although our common stock and depositary shares are listed for trading on the Nasdaq Global Select Market, trading volume may be less than
that of other, larger financial services companies. A public trading market having the desired characteristics of depth, liquidity and orderliness
depends on the presence in the marketplace of willing buyers and sellers of our common stock or depositary shares at any given time, a factor
over which we have no control. During any period of lower trading volume of our common stock or depositary shares, significant sales of shares
of our common stock or depositary shares or the expectation of these sales could cause our common stock or depositary shares price to fall.
An investment in our common stock or depositary shares is not insured and you could lose the value of your entire investment.
An investment in our common stock or depositary shares is not a savings account, deposit or other obligation of our bank subsidiary, any non-
bank subsidiary or any other bank, and such investment is not insured or guaranteed by the FDIC or any other governmental agency. As a result,
if you acquire our common stock or depositary shares, you may lose some or all of your investment.
Our ability to pay dividends is limited by various statutes and regulations and depends primarily on the Bank’s ability to distribute funds to us
and is also limited by various statutes and regulations.
We depend on payments from the Bank, including dividends, management fees and payments under tax sharing agreements, for substantially all
of our liquidity requirements. Federal and state regulations limit the amount of dividends and the amount of payments the Bank may make to us
under tax sharing agreements. In certain circumstances, the Missouri Division of Finance, FDIC, or Federal Reserve Board could restrict or
prohibit the Bank from distributing dividends or making other payments to us. In the event the Bank was restricted from paying
25

dividends to us or making payments under the tax sharing agreement, we may not be able to service our debt, pay our other obligations or pay
dividends on our common stock or preferred stock. If we are unable or determine not to pay dividends on our outstanding equity securities, the
market price of such securities could be materially adversely affected.
There can be no assurance of any future dividends on our common stock or our depositary shares.
Holders of our common stock and depositary shares are entitled to receive dividends only when, as and if declared by the Board of Directors.
Although we have historically paid cash dividends, we are not required to do so.
Our outstanding preferred stock and debt securities, including debt securities related to our trust preferred securities, restrict our ability to pay
dividends on our capital stock.
We have outstanding preferred stock and subordinated debentures issued to statutory trust subsidiaries, which have issued and sold preferred
securities in the Trusts to investors. These instruments prohibit the payment of dividends on our common stock in certain situations. See “Item 1.
Business – Supervision and Regulation - Financial Holding Company - Dividend Restrictions and Share Repurchases” for additional
information.
Moreover, any other financing agreements that we enter into in the future may limit our ability to pay cash dividends on our capital stock,
including the common stock. In the event that our existing or future financing agreements restrict our ability to pay dividends in cash on the
common stock, we may be unable to pay dividends in cash on the common stock unless we can refinance amounts outstanding under those
agreements. In addition, if we are unable or determine not to pay interest on our preferred stock or subordinated debentures, the market price of
our common stock could be materially or adversely affected.
Anti-takeover provisions could negatively impact our shareholders.
Provisions of Delaware law and of our certificate of incorporation, as amended, and bylaws, as well as various provisions of federal and
Missouri state law applicable to bank and bank holding companies, could make it more difficult for a third party to acquire control of us or have
the effect of discouraging a third party from attempting to acquire control of us. We are subject to Section  203 of the Delaware General
Corporation Law, which would make it more difficult for another party to acquire us without the approval of our Board of Directors.
Additionally, our certificate of incorporation, as amended, authorizes our Board of Directors to issue preferred stock which could be issued as a
defensive measure in response to a takeover proposal. In the event of a proposed merger, tender offer or other attempt to gain control of the
Company, our Board of Directors would have the ability to readily issue available shares of preferred stock as a method of discouraging,
delaying or preventing a change in control of the Company. Such issuance could occur regardless of whether our shareholders favorably view the
merger, tender offer or other attempt to gain control of the Company. These and other provisions could make it more difficult for a third party to
acquire us even if an acquisition might be in the best interests of our shareholders. Although we have no present intention to issue any additional
shares of our authorized preferred stock, there can be no assurance that the Company will not do so in the future.
General Risk Factors
Climate change may materially adversely affect our business and results of operations.
Severe weather events may cause operational disruptions and damage to both our properties and properties securing our loans. Losses resulting
from these disasters and severe weather events may make it more difficult for borrowers to timely repay their loans. If these events occur, we
may experience a decrease in the value of our loan portfolio and our revenue, and may incur additional operational expenses, each of which
could have a material adverse effect on our financial condition and results of operations.
The risks associated with climate change, and the legislative and regulatory responses, are evolving, making them difficult to assess due to
limited data and other uncertainties. We could experience increased expenses resulting from strategic planning, litigation, and technology and
market changes, and reputational harm as a result of public sentiment, regulatory scrutiny, and reduced investor and stakeholder confidence due
to our response to climate change and our climate change strategy, which, in turn, could have a material negative impact on our business, results
of operations, and financial condition.
26

ITEM 1B: UNRESOLVED STAFF COMMENTS
None.
ITEM 1C: CYBERSECURITY
Governance
Our Information Security (“IS”) Program consists of policies, procedures and guidelines to ensure the security, availability and confidentiality of
client information. The IS Program is led by our Chief Information Security Officer (“CISO”) under the direction of the Chief Administrative
Officer and is subject to additional management oversight by our Operations Technology Committee. The CISO has over 20 years of experience
in cybersecurity and is a licensed attorney in both Missouri and Illinois. He currently holds multiple professional security certifications that
include ISC2 Certified Information System Security Professional and Certified Cloud Security Professional, ISACA Certified Information
Security Manager and EC-Council Certified Ethical Hacker. The Chief Administrative Officer is a licensed CPA in the state of Missouri. Prior to
his appointment as Chief Administrative Officer, he served at Enterprise in senior finance roles within the Company, including Senior Vice
President and Controller, and Chief Financial Officer of Enterprise Bank & Trust. The Operations Technology Committee is a management
committee with overall responsibility for monitoring the systems, policies and procedures for our loan, deposit and wealth management business
operations. This includes the framework used to identify and prevent cyberattacks or breaches. The Operations Technology Committee chair
reports committee activities into the Risk Committee of the Board. Additionally, the CISO is a member of this committee, as well as the Risk
Oversight and Sustainability Committees, and advises these committees on risks and opportunities related to information security, including data
privacy.
The Risk Committee of the Board oversees the IS Program in the following ways: (a) monitors and oversees the Company’s business and
information technology operations necessary for its business plan, including projected growth, technology capacity, planning, operational
execution, product development and management capacity, (b) reviews the Company’s framework to prevent, detect, and respond to cyberattacks
or breaches, as well as identifying areas of concern regarding possible vulnerabilities and best practices to secure points of vulnerability, and
reviews policies pertaining to information security and cyber threats, taking into account the potential for external threats, internal threats, and
threats arising from transactions with trusted third parties and vendors, and (c) reviews the Company’s incident response, business continuity and
disaster recovery planning and preparedness including processes, policies and procedures that are related to preparing for recovery or
continuation of technology infrastructure which are vital to the Company. As part of the Board’s oversight, the Board receives quarterly IS
reports and updates from the Chief Information Officer (“CIO”) and CISO. At least annually, our Board also receives IS reports from the CISO
which summarize new and emerging cybersecurity trends, trends in type, frequency and origination of attacks, and the effectiveness of our IS
Program in mitigating cybersecurity threats. In the event of an information security incident, our Incident Response Plan clarifies the steps for
escalation according to the severity of the attack.
The IS team is staffed primarily with internal associates and we utilize third party service providers for extended coverage. We hire IS team
members that have industry relevant information security or technology certifications and knowledge to implement and oversee the procedures
and processes of our IS Program and to adequately manage and enforce our IS policies, procedures and guidelines. Further, management
involved in the cybersecurity process possess the necessary skills and expertise to adequately manage and enforce our IS policies, procedures
and guidelines.
While all vendors are subject to our vendor management due diligence process, those with access to our data and data centers are subject to more
rigorous initial and more frequent ongoing due diligence. This includes reviews of Service Organization Control 2 reports, information security
policies, vulnerability and penetration tests, human resource policies such as background checks and training, and business continuity plans.
We may face cybersecurity risks in connection with our normal business that could have a material adverse effect on our business strategy,
results of operations, financial condition, or reputation. Although such risks have not materially affected us, we have experienced, and may
continue to experience, cyber incidents during our normal
27

course of business. For further discussion about these risks, see “Item 1A. Risk Factors - Technology and Cybersecurity Risks.”
Risk Management and Strategy
As part of the ongoing maintenance and development of our IS Program, we assess the various risks associated with the unauthorized access or
loss of client information and the quality of security controls as prescribed by the Federal Financial Institutions Examinations Council and the
National Institute of Standards and Technology Cybersecurity Framework. Our IS risk assessments are prepared in conjunction with our ERM
framework, and the results are used to develop strategies to minimize risk to information assets.
Our systems are monitored 24/7 for cybersecurity threats, and we utilize a variety of tools to reduce the risk of data breaches. We maintain an
Incident Response Plan which outlines the steps to be taken in the event of an information security incident, which could include a potential or
actual data breach. The plan identifies a designated team, including associates and third-party experts responsible for the response, and
summarizes the steps, including escalation protocol, for determining whether a breach has occurred and the nature and scope of the breach (if
applicable). The plan also summarizes protocol for notifying impacted persons, which may include clients, as well as other applicable agencies
or persons, including law enforcement and regulatory authorities.
The Incident Response Plan is led by our CISO, who is also a member of the Disclosure Committee. The Disclosure Committee is a cross-
functional management group that is tasked with ensuring that external disclosures subject to SEC rules and regulations are accurate, complete,
and timely. Members of the Disclosure Committee include leadership from accounting, credit, information security, information technology,
legal, and operations. In conjunction with the working process of the Incident Response Plan, members of the Disclosure Committee evaluate
cybersecurity incidents to determine whether disclosure is required.
At least annually, we conduct a third-party information security penetration audit focusing on internal and external network security protocols, as
well as internally managed ad hoc testing as needed. Simulations and tabletop testing of our business continuity and Incident Response Plans are
performed on a routine basis to test and assist with our associates’ familiarity and preparedness for a security event. Any gaps or improvement
areas identified by routine testing are addressed in a timely manner to help improve future security testing.
The processes and controls related to data security are regularly tested by the IS department and Internal Audit. Additional internal security
assessments may be performed at the request of the CISO, CIO, the Director of Internal Audit, Management or our Board. Audit and assessment
results are presented to the Board, as well as the following committees: management’s Operations Technology Committee and the Audit and
Risk Committees of the Board.
At least annually, the IS Program, including its effectiveness, is reviewed by the Board or a committee thereof. Annually, all associates
participate in mandatory training on data privacy provisions and policies, including information security and its importance with respect to client
and associate privacy.
All associates (including both full-time and part-time associates) are required to participate in monthly firmwide phishing tests.
ITEM 2: PROPERTIES
Our executive offices are located at 150 North Meramec Avenue, Clayton, Missouri, 63105. As of December 31, 2024, we utilized banking
locations and administrative offices throughout our market areas of Arizona, California, Florida, Kansas, Missouri, Nevada, and New Mexico.
Additionally, the Company has a limited network of loan production offices and deposit production offices in various other states. We own or
lease our facilities and believe all of our properties are in good condition to meet our business needs.
ITEM 3: LEGAL PROCEEDINGS
The Company is, from time to time, a party to various legal proceedings arising out of its businesses. Management believes there are no such
legal proceedings pending or threatened against the Company in the ordinary course of
28

business, directly, indirectly, or in the aggregate that, if determined adversely, would have a material adverse effect on the business, consolidated
financial condition, results of operations or cash flows of the Company.
For more information on our legal proceedings, see “Item 8. Note 13 – Litigation and Other Contingencies” in this Annual Report on Form 10-K.
ITEM 4: MINE SAFETY DISCLOSURES
Not applicable.
PART II
ITEM 5: MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
Market for Our Common Stock
The Company’s common stock trades on the Nasdaq Global Select Market under the symbol “EFSC.” As of February 26, 2025, the Company
had 1,523 registered shareholders of common stock. The number of holders of record does not represent the actual number of beneficial owners
of our common stock because securities dealers and others frequently hold shares in “street name” for the benefit of individual owners who have
the right to vote shares.
Dividends
The Company paid quarterly cash dividends on common shares in each of 2024, 2023 and 2022 and anticipates continuing to pay comparable
dividends. Total dividends paid per common share were $1.06 in 2024, $1.00 in 2023 and $0.90 in 2022. However, we have no obligation to pay
dividends and we may change our dividend policy at any time without notice to our shareholders.
Our ability to pay dividends is substantially dependent upon the ability of our subsidiaries to pay cash dividends to us. Information on regulatory
restrictions on our ability to pay dividends is set forth in “Part I, Item 1. Business - Supervision and Regulation - Financial Holding Company -
Dividend Restrictions and Share Repurchases.” The amount of dividends, if any, that may be declared by the Company also depends on many
other factors, including future earnings, bank regulatory capital requirements and business conditions as they affect the Company and its
subsidiaries. As a result, no assurance can be given that dividends will be paid in the future with respect to our common stock.
Recent Sales of Unregistered Securities and Use of Proceeds
None.
Issuer Purchases of Equity Securities
Period
Total number of
shares purchased
Weighted-average
price paid per
share
Total number of shares
purchased as part of
publicly announced
plans or programs (a)
Maximum number of
shares that may yet be
purchased under the
plans or programs (a)
October 1, 2024 through October 31, 2024
77,256 
$
50.59 
77,256 
1,502,495 
November 1, 2024 through November 30, 2024
32,000 
52.64 
32,000 
1,470,495 
December 1, 2024 through December 31, 2024
97,273 
57.17 
97,273 
1,373,222 
Total
206,529 
$
54.01 
206,529 
(a) In May 2022, the Company’s board of directors authorized the repurchase of up to two million shares of the Company’s common stock. The
repurchases may be made from time to time in the open market or through privately negotiated transactions.
29

Stock Performance Graph
The following graph compares the cumulative total shareholder return on the Company’s common stock from December  31, 2019 through
December  31, 2024. The graph compares the Company’s common stock with the Nasdaq Composite Index (U.S. companies) and the S&P
Regional Banks Select Industry Index.
The graph assumes an investment of $100.00 in the Company’s common stock and each index at the respective closing price on December 31,
2019 and reinvestment of all quarterly dividends. The investment is measured as of each subsequent fiscal year end. There is no assurance the
Company’s common stock performance will continue in the future with the same or similar results as shown in the graph.
Period Ending December 31,
Index
2019
2020
2021
2022
2023
2024
Enterprise Financial Services Corp
$
100.00  $
74.17  $
101.53  $
107.65  $
100.47  $
129.91 
Nasdaq Composite Index
$
100.00  $
144.92  $
177.06  $
119.45  $
172.77  $
223.87 
S&P Regional Banks Select Industry Index
$
100.00  $
92.90  $
129.98  $
110.80  $
102.56  $
122.17 
*Source: S&P Global Market Intelligence. Used with permission. All rights reserved.
ITEM 6: [RESERVED]
30

ITEM 7: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
 
Introduction
The objective of this section is to provide an overview of the results of operations and financial condition of the Company by focusing on
changes in certain key measures from year to year. It should be read in conjunction with the Consolidated Financial Statements and related Notes
contained in “Item 8. Financial Statements and Supplementary Data,” and other financial data presented elsewhere in this report, particularly the
information regarding the Company’s business operations described in Item 1. A detailed discussion comparing 2023 and 2022 results is
incorporated herein by reference to Item 7 of the Company’s 2023 Annual Report on Form 10-K filed on February 26, 2024.
Executive Summary
Our Company offers a broad range of business and personal banking services including wealth management. Lending services include
commercial and industrial, commercial real estate, real estate construction and development, residential real estate, specialty, and other loans. A
wide variety of deposit products and a complete suite of treasury management and international trade services complement our lending
capabilities. The Company’s results of operations are also affected by prevailing economic conditions, competition, government policies and
other actions of regulatory agencies.
The Company’s financial condition, operating results and liquidity in 2024 continued to be impacted by monetary policy actions. The Federal
Reserve decreased the target federal funds rate 100 basis points in the fourth quarter 2024, following a 100 basis point increase in 2023. The
Federal Reserve has begun to loosen its monetary policy, but has indicated it will continue to reduce its balance sheet namely through a reduction
in bond holdings. These actions represent the Federal Reserve’s response to an environment of high inflation and elevated interest rates
following a period of highly expansionary fiscal support from the federal government during the COVID-19 pandemic in 2020-2021.
31

Financial Performance Highlights
Below are highlights of our financial performance for the years ended December 31, 2024, 2023 and 2022.
($ in thousands, except per share data)
At or for the year ended December 31,
2024
2023
2022
EARNINGS
Total interest income
$
851,051 
$
764,919 
$
515,082 
Total interest expense
282,955 
202,327 
41,179 
Net interest income
568,096 
562,592 
473,903 
Provision (benefit) for credit losses
21,508 
36,605 
(611)
Net interest income after provision (benefit) for credit losses
546,588 
525,987 
474,514 
Total noninterest income
69,703 
68,725 
59,162 
Total noninterest expense
385,047 
348,186 
274,216 
Income before income tax expense
231,244 
246,526 
259,460 
Income tax expense
45,978 
52,467 
56,417 
Net income
$
185,266 
$
194,059 
$
203,043 
Preferred dividends
3,750 
3,750 
4,041 
Net income available to common shareholders
$
181,516 
$
190,309 
$
199,002 
Basic earnings per share
$
4.86 
$
5.09 
$
5.32 
Diluted earnings per share
$
4.83 
$
5.07 
$
5.31 
Return on average assets
1.25 %
1.41 %
1.52 %
Adjusted return on average assets
1.26 %
1.41 %
1.52 %
Return on average common equity
10.60 %
12.27 %
13.95 %
Adjusted return on average common equity
10.71 %
12.35 %
13.95 %
Return on average tangible common equity
13.58 %
16.25 %
19.10 %
Adjusted return on average tangible common equity
13.71 %
16.35 %
19.10 %
Net interest margin (fully tax equivalent)
4.16 %
4.43 %
3.89 %
Efficiency ratio
60.37 %
55.15 %
51.44 %
Core efficiency ratio
58.42 %
53.42 %
49.77 %
Common dividend payout ratio
21.95 %
19.72 %
16.95 %
Book value per common share
$
47.37 
$
43.94 
$
38.93 
Tangible book value per common share
$
37.27 
$
33.85 
$
28.67 
Average common equity to average assets
11.54 %
11.24 %
10.71 %
Tangible common equity to tangible assets
9.05 %
8.96 %
8.43 %
ASSET QUALITY
Net charge-offs
$
17,450 
$
38,044 
$
3,899 
Nonperforming loans
42,687 
43,728 
9,981 
Nonaccrual loans
42,667 
43,181 
9,766 
Classified assets
193,838 
185,389 
99,122 
Total assets
15,596,431 
14,518,590 
13,054,172 
Total loans
11,220,355 
10,884,118 
9,737,138 
Classified assets to total assets
1.24 %
1.28 %
0.76 %
Nonperforming loans to total loans
0.38 %
0.40 %
0.10 %
Nonperforming assets to total assets
0.30 %
0.34 %
0.08 %
ACL on loans to total loans
1.23 %
1.24 %
1.41 %
Net charge-offs to average loans
0.16 %
0.37 %
0.04 %
Non-GAAP measures. A reconciliation has been included in this MD&A section under the caption “Use of Non-GAAP Financial Measures.”
Common dividends per share divided by diluted earnings per share.
1
1
1
1
1
2
1
1
1
2
32

The Company noted the following trends during 2024:
•
The Company reported net income of $185.3 million, or $4.83 per diluted share for 2024, compared to $194.1 million, or $5.07 per
diluted share for 2023. PPNR  for 2024 was $255.2 million, compared to $284.8 million in 2023. PPNR ROAA  for 2024 and 2023 was
1.72% and 2.06%, respectively. The decrease in PPNR and PPNR ROAA was primarily due to increases in employee compensation
and benefits, deposit costs, and expenses incurred in connection with the core system conversion, partially offset by an increase in
operating revenue. Offsetting the decrease in PPNR and PPNR ROAA  was a $15.1 million decrease in the provision for credit losses in
2024 compared to 2023, due to an improvement in overall asset quality.
•
NIM decreased to 4.16% in 2024, from 4.43% in 2023, primarily due to the impact of higher interest expense on the deposit portfolio
from an increase in deposit rates and average balances. The total cost of deposits was 2.12% in 2024 compared to 1.58% in 2023.
Offsetting the decline in NIM was a $995.0 million increase in average interest earning assets, which resulted in total net interest income
of $568.1 million, a $5.5 million increase over the prior year.
•
Noninterest income was $69.7 million, an increase of $1.0 million from $68.7 million in 2023. Noninterest expense was $385.0 million
in 2024, an 11% increase from $348.2 million in 2023. The increase in noninterest expense was primarily from higher customer deposit
servicing costs due to higher average balances and an increase in earnings credit rates, an increase in compensation due to the
recruitment of new relationship bankers and annual merit increases, and expenses related to the core system conversion. The core
efficiency ratio  was 58.4% in 2024, compared to 53.4% in 2023.
•
The Company’s effective tax rate was 19.9% in 2024 compared to 21.3% in 2023.
2024 Financial Highlights
During 2024, we announced the following significant transactions:
•
The Company had a return on average assets of 1.25%. This drove a 10.1% increase in tangible book value per share in 2024.
•
Dividends paid in 2024 of $1.06 per share increased $0.06 per share, or 6%, compared to $1.00 per share in 2023.
•
The Company repurchased 626,778 of its common shares at a weighted-average share price of $46.95.
•
In the fourth quarter 2024, the Company successfully completed the conversion of its legacy core system into a new core banking
platform.
2023 Financial Highlights
During 2023, we announced the following significant transactions:
•
Dividends paid in 2023 of $1.00 per share increased $0.10 per share, or 11%, compared to $0.90 per share in 2022.
•
The process of converting to a leading core operating system was initiated.
 PPNR, PPNR ROAA, and the core efficiency ratio are non-GAAP measures. A reconciliation has been included in this MD&A section under the caption “Use of Non-GAAP
Financial Measures.”
1
1
1 
1 
1 
1
1
1
33

RESULTS OF OPERATIONS
Net Interest Income
Average Balance Sheet
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. Average balances are presented on a daily
average basis.
 
Year ended December 31,
 
2024
2023
2022
($ 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
$
10,990,774 
$
755,448 
6.87 %
$
10,324,951 
$
688,439 
6.67 %
$
9,193,682 
$
456,703 
4.97 %
Taxable securities
1,512,132 
53,167 
3.52
1,320,664 
40,920 
3.10 
1,228,514 
29,638 
2.41 
Non-taxable securities
1,000,558 
31,963 
3.19
970,888 
30,209 
3.11 
872,173 
25,184 
2.89 
Total securities
2,512,690 
85,130 
3.39
2,291,552 
71,129 
3.10 
2,100,687 
54,822 
2.61 
Interest-earning deposits
368,221 
18,918 
5.14
260,214 
13,430 
5.16 
1,074,165 
10,599 
0.99 
Total interest-earning assets
13,871,685 
859,496 
6.20
12,876,717 
772,998 
6.00 
12,368,534 
522,124 
4.22 
 
 
 
Noninterest-earning assets
970,005 
928,519 
951,090 
 Total assets $
14,841,690 
$
13,805,236 
$
13,319,624 
Liabilities and Shareholders' Equity
 
 
 
Interest-bearing liabilities:
 
 
 
Interest-bearing demand accounts
$
3,033,616 
$
76,932 
2.54 %
$
2,559,238 
$
46,976 
1.84 %
$
2,318,363 
$
7,038 
0.30 %
Money market accounts
3,494,497 
127,651 
3.65 
3,043,794 
92,976 
3.05 
2,781,579 
19,306 
0.69 
Savings accounts
567,147 
1,261 
0.22 
668,368 
975 
0.15 
819,043 
305 
0.04 
Certificates of deposit
1,371,009 
58,764 
4.29 
1,198,551 
42,796 
3.57 
569,272 
3,509 
0.62 
Total interest-bearing deposits
8,466,269 
264,608 
3.13 
7,469,951 
183,723 
2.46 
6,488,257 
30,158 
0.46 
Subordinated debentures and notes
156,260 
10,497 
6.72 
155,702 
9,781 
6.28 
155,160 
9,166 
5.91 
FHLB advances
30,363 
1,691 
5.57 
54,615 
2,752 
5.04 
33,467 
599 
1.79 
Securities sold under agreements to
repurchase
164,959 
5,667 
3.44 
168,745 
3,647 
2.16 
211,039 
506 
0.24 
Other borrowings
37,833 
492 
1.30 
71,738 
2,424 
3.38 
22,812 
750 
3.29 
Total interest-bearing liabilities
8,855,684 
282,955 
3.20 
7,920,751 
202,327 
2.55 
6,910,735 
41,179 
0.60 
Noninterest-bearing liabilities:
Demand deposits
4,042,368 
4,131,163 
4,805,549 
Other liabilities
159,463 
130,201 
104,581 
Total liabilities
13,057,515 
12,182,115 
11,820,865 
Shareholders' equity
1,784,175 
1,623,121 
1,498,759 
Total liabilities & shareholders' equity $
14,841,690 
$
13,805,236 
$
13,319,624 
Net interest income
$
576,541 
$
570,671 
$
480,945 
Net interest spread
3.00 %
3.45 %
3.62 %
Net interest margin (tax equivalent)
4.16 %
4.43 %
3.89 %
Average balances include non-accrual loans. Interest income includes net loan fees of $9.6 million, $13.8 million, and $16.7 million for the years ended December 31, 2024,
2023, and 2022 respectively. Loan fees in 2022 included Paycheck Protection Program fees of $4.1 million.
Non-taxable income is presented on a fully tax-equivalent basis using a tax rate of approximately 25%. The tax-equivalent adjustments were $8.4 million, $8.1 million, and $7.0
million for the years ended December 31, 2024, 2023, and 2022, respectively.
1, 2
2
1
2
34

Rate/Volume
The following table sets forth, on a tax-equivalent basis for the periods indicated, a summary of the changes in interest income and interest
expense resulting from changes in yield/rates and volume.
 
2024 compared to 2023
2023 compared to 2022
Increase (decrease) due to
Increase (decrease) due to
($ in thousands)
Volume
Rate
Net
Volume
Rate
Net
Interest earned on:
 
 
 
Loans
$
45,473 
$
21,536 
$
67,009 
$
61,460 
$
170,276 
$
231,736 
Taxable securities
6,347 
5,900 
12,247 
2,355 
8,927 
11,282 
Non-taxable securities
936 
818 
1,754 
2,981 
2,045 
5,026 
Interest-earning deposits
5,549 
(61)
5,488 
(13,192)
16,023 
2,831 
Total interest-earning assets
58,305 
28,193 
86,498 
53,604 
197,271 
250,875 
Interest paid on:
Interest-bearing demand accounts
$
9,794 
$
20,162 
$
29,956 
$
805 
$
39,133 
$
39,938 
Money market accounts
14,928 
19,747 
34,675 
1,987 
71,683 
73,670 
Savings
(165)
451 
286 
(66)
736 
670 
Certificates of deposit
6,674 
9,294 
15,968 
7,363 
31,924 
39,287 
Subordinated debentures and notes
35 
681 
716 
32 
583 
615 
FHLB advances
(1,326)
265 
(1,061)
555 
1,599 
2,154 
Securities sold under agreements to repurchase
(84)
2,104 
2,020 
(126)
3,268 
3,142 
Other borrowed funds
(839)
(1,093)
(1,932)
1,729 
(56)
1,673 
Total interest-bearing liabilities
29,017 
51,611 
80,628 
12,279 
148,870 
161,149 
Net interest income
$
29,288 
$
(23,418)
$
5,870 
$
41,325 
$
48,401 
$
89,726 
Change in volume multiplied by yield/rate of prior period.
Change in yield/rate multiplied by volume of prior period.
Nontaxable income is presented on a fully tax equivalent basis using a tax rate of approximately 25%.
NOTE: The change in interest due to both rate and volume has been allocated to rate and volume changes in proportion to the relationship of the absolute dollar amounts of the
change in each.
Net interest income (on a tax equivalent basis) was $576.5 million for 2024, compared to $570.7 million for 2023, an increase of $5.9 million.
The increase in net interest income in 2024 was primarily due to a higher average yield on interest earning assets and organic loan growth, which
was partially offset by an increase in the average cost paid on interest bearing liabilities.
Total tax equivalent interest income increased $86.5 million in 2024 primarily due to a $67.0 million increase in loan interest income. The
increase was primarily due to an increase in average loan balances of $665.8 million during the year. In addition, the loan yield increased 20
basis points from 6.67% in 2023 to 6.87% in 2024. Tax equivalent interest income on securities (taxable and non-taxable) in 2024 increased
$14.0 million from 2023, primarily due to increases of $7.3 million in interest income on average balances and $6.7 million in yield. Average
securities represented 18% of earnings assets in both 2024 and 2023.
Overall, average interest-earning assets increased $995.0 million, or 8%, to $13.9 billion for the year ended December 31, 2024, primarily due to
success in growing the deposit portfolio. The loan portfolio expanded and excess liquidity was deployed into the investment portfolio and other
interest-earning assets. Volume growth of the balance sheet drove an increase in interest income on earning assets of $58.3 million, while higher
loan and securities yields drove interest income on interest-earning assets up by $28.2 million in 2024 compared to 2023.
Total interest expense increased $80.6 million in 2024 primarily due to increased deposit interest expense. The increase in deposit interest
expense reflects higher rates paid on deposits, as well as successful marketing efforts that
1
2
1
2
3
1
2
3
35

increased average deposits. Remixing of the deposit portfolio from noninterest-bearing and lower cost accounts into higher cost accounts
contributed to the increase in deposit interest expense in 2024. Total average interest-bearing deposits increased to $8.5 billion, an increase of
$996.3 million, or 13%, in 2024 over the average for 2023. Average noninterest-bearing deposits declined $88.8 million, or 2%, in 2024
compared to the average for 2023. Average noninterest-bearing deposits represented 31% of total average deposits in 2024, compared to 36% in
2023. Overall, average interest-bearing liabilities increased $934.9 million, or 12%, for the year ended December 31, 2024. The shift in volume
from noninterest-bearing deposit accounts into higher cost deposit accounts increased interest expense in 2024 by $29.0 million, while the
increase in the average cost of interest-bearing liabilities increased interest expense $51.6 million in 2024.
The tax-equivalent net interest margin was 4.16% for 2024, compared to 4.43% for 2023. The primary driver of the decrease in net interest
margin from 2023 to 2024 was higher interest expense on the deposit portfolio. In 2023, the Federal Reserve increased interest rates three times
for a total of 100 basis points. In the fourth quarter 2024, the Federal Reserve lowered the federal funds target rate by 100 basis points. As of
December 31, 2024, variable-rate loans comprised approximately 60% of total loans. The earning-asset yield increased 20 basis points to 6.20%
in 2024, compared to 6.00% in 2023. Comparatively, the cost of interest-bearing liabilities increased 65 basis points to 3.20%, from 2.55% in
2023.
Noninterest Income
The following table presents a comparative summary of the major components of noninterest income for each of the years in the three-year
period ended December 31, 2024:
Year ended December 31,
Change from
($ in thousands)
2024
2023
2022
2024 vs. 2023
2023 vs. 2022
Service charges on deposit accounts
$
18,344 
$
16,559 
$
18,326 
$
1,785 
$
(1,767)
Wealth management revenue
10,452 
10,030 
10,010 
422 
20 
Card services revenue
9,966 
10,028 
11,551 
(62)
(1,523)
Tax credit income
8,954 
9,196 
2,558 
(242)
6,638 
Other income
21,987 
22,912 
16,717 
(925)
6,195 
Total noninterest income
$
69,703 
$
68,725 
$
59,162 
$
978 
$
9,563 
Noninterest income increased $1.0 million, or 1%, in 2024 compared to 2023. This increase was primarily due to a $1.8 million increase in
service charges on deposit accounts, partially offset by a $0.9 million decrease in other income. Other income decreased primarily due to lower
private equity and community development income ($3.1 million) and gains on the sale of SBA loans ($0.6 million), offset by an increase in
gains on sale of other real estate owned ($2.9 million). Private equity and community development income are not consistent sources of income
and fluctuate based on distributions and earnings from the underlying funds. In 2024, the Company sold the guaranteed portion of SBA 7(a)
loans of $23.1 million for a gain of $1.4 million, compared to $42.1 million and $2.0 million, respectively, in 2023.
36

Noninterest Expense
The following table presents a comparative summary of the components of noninterest expense:
Year ended December 31,
Change from
($ in thousands)
2024
2023
2022
2024 vs. 2023
2023 vs. 2022
Employee compensation and benefits
$
182,713 
$
164,566 
$
147,029 
$
18,147 
$
17,537 
Deposit costs
88,645 
72,293 
31,082 
16,352 
41,211 
Occupancy
17,231 
16,526 
17,640 
705 
(1,114)
Data processing
19,671 
15,196 
13,513 
4,475 
1,683 
Professional fees
6,257 
5,719 
7,079 
538 
(1,360)
Other expenses
70,530 
73,886 
57,873 
(3,356)
16,013 
Total noninterest expense
$
385,047 
$
348,186 
$
274,216 
$
36,861 
$
73,970 
Efficiency ratio
60.37 %
55.15 %
51.44 %
5.22 %
3.71 %
Core efficiency ratio
58.42 %
53.42 %
49.77 %
5.00 %
3.65 %
A non-GAAP measure. A reconciliation has been included in this MD&A section under the caption “Use of Non-GAAP Financial Measures.”
Noninterest expense increased $36.9 million, or 11%, in 2024 compared to 2023. The increase was attributed primarily to an increase in
compensation and benefits due to annual merit increases and the recruitment of new relationship bankers, a $16.4 million increase in deposit
costs, and a $4.5 million increase in data processing primarily related to the core system conversion. The total cost of the core conversion in
noninterest expense was $4.9 million in 2024. For certain deposit accounts in the Company’s deposit verticals, clients receive an earnings credit
on average collected balances that may be used to offset expenses associated with the client’s activities for managing the accounts. These costs
are reflected in noninterest expense as Deposit costs. The increase in deposit costs in 2024 is due to organic growth in the deposit verticals and
an increase in market interest rates that increased the earnings credit rate and related expenses for those accounts. Average balances in the deposit
verticals were approximately $3.1 billion and $2.6 billion, resulting in an average deposit vertical cost of 2.82% and 2.75% for 2024 and 2023,
respectively.
Income Taxes
The Company’s blended federal and state tax rate was approximately 24.8% in 2024 and 2023. The effective tax rate, which is adjusted for
permanent differences, such as tax exempt income and tax credits, was 19.9% in 2024 compared to 21.3% in 2023. The effective tax rate
decrease was driven by tax credit opportunities the Company has deployed as part of its tax planning strategy. See “Item 8. Note 16 – Income
Taxes” for additional information.
FINANCIAL CONDITION
Summary Balance Sheet
($ in thousands)
December 31,
% Increase (Decrease)
2024
2023
2022
2024 vs. 2023
2023 vs. 2022
Cash and cash equivalents
$
764,170 
$
433,029 
$
291,359 
76.47 %
48.62 %
Securities
2,791,205 
2,368,707 
2,245,722 
17.84 %
5.48 %
Loans
11,220,355 
10,884,118 
9,737,138 
3.09 %
11.78 %
Assets
15,596,431 
14,518,590 
13,054,172 
7.42 %
11.22 %
Deposits
13,146,492 
12,176,371 
10,829,150 
7.97 %
12.44 %
Liabilities
13,772,429 
12,802,522 
11,531,909 
7.58 %
11.02 %
Shareholders’ equity
1,824,002 
1,716,068 
1,522,263 
6.29 %
12.73 %
1
1 
37

The table below represents the summary balance sheet shown as a percentage of account class (total assets, total liabilities or total shareholders’
equity), as applicable:
December 31,
2024
2023
2022
Cash and cash equivalents to total assets
4.90 %
2.98 %
2.23 %
Securities to total assets
17.90 %
16.31 %
17.20 %
Loans to total assets
71.94 %
74.97 %
74.59 %
Deposits to total liabilities
95.46 %
95.11 %
93.91 %
Assets
Loans by Type
The Company has a diversified loan portfolio, with no particular concentration of credit in any one economic sector other than those noted in the
table of loans by NAICS code below; however, a substantial portion of the portfolio, including the C&I category, is secured by real estate. The
ability of the Company’s borrowers to honor their contractual obligations is partially dependent upon the local economy and its effect on the real
estate market.
The following table sets forth the composition of the loan portfolio by type of loans:
December 31,
($ in thousands)
2024
2023
Commercial and industrial
$
4,716,689 
$
4,672,559 
Commercial real estate - investor owned
2,606,964 
2,451,953 
Commercial real estate - owner occupied
2,367,823 
2,351,618 
Construction and land development
891,059 
760,425 
Residential real estate
359,263 
372,188 
Other
278,557 
275,375 
Total loans
$
11,220,355 
$
10,884,118 
December 31,
2024
2023
Commercial and industrial
42.0 %
42.9 %
Commercial real estate - investor owned
23.2 %
22.5 %
Commercial real estate - owner occupied
21.1 %
21.6 %
Construction and land development
8.0 %
7.1 %
Residential real estate
3.2 %
3.4 %
Other
2.5 %
2.5 %
Total loans
100.0 %
100.0 %
C&I loans are made based on the borrower’s ability to generate cash flows for repayment from income sources, general credit strength,
experience, and character, even though such loans may also be secured by real estate or other assets. The credit risk related to commercial loans
is largely influenced by general economic conditions and the resulting impact on a borrower’s operations.
The Company continues to focus on originating high-quality C&I loan relationships as they allow for cross selling opportunities involving other
banking products. Our specialized products, especially sponsor finance, life insurance premium financing, and tax credit lending, consist of
primarily C&I loans, and have contributed significantly to the Company’s C&I loan growth. These loans are sourced through relationships
developed with wealth and estate planning firms, private equity funds and tax credit specialists and are not bound geographically to our markets.
As a result, these specialized loan products offer opportunities to expand and diversify our overall geographic concentration by entering into new
markets.
38

Real estate loans place an emphasis on the estimated cash flows from the operation of the property and/or the underlying collateral value.
•
Our commercial real estate loans, including investor-owned and owner-occupied categories, primarily represent commercial property
loans on which the primary source of repayment is income from the property for investor-owned and the operating business for owner-
occupied. These loans are principally underwritten based on the cash flow coverage of the property, the Company’s loan to value
guidelines, and generally require either the limited or full guaranty of principal sponsors of the credit. The Company also maintains
standards for amortization and maturity terms. Commercial real estate loans also represent owner-occupied C&I loans for which the
primary source of repayment is dependent on sources other than the underlying collateral. In an effort to mitigate credit risk, the
Company routinely reviews its loan portfolio for various concentrations. Annually, management prepares an assessment of credit risk in
the various loan portfolios, with a significant portion of the commercial loan portfolio subject to review. These reviews consider the
Company’s collateral position as well as exposure to a given industry sector. The Company performs site visits as part of the
underwriting process, in addition to stress tests for vacancy, rental and interest rates on certain property types. The Company believes
that the loan portfolio is sufficiently diversified to provide protection from deterioration in any particular industry, geography or
devaluation of a specific collateral type.
•
Construction and land development loans relating primarily to residential and commercial properties, represent financing secured by real
estate under development for eventual sale or undeveloped ground. At December 31, 2024, $334.2 million of these loans include the use
of interest reserves and follow standard underwriting guidelines. Construction projects are monitored by the loan officer and a
centralized independent loan disbursement function.
•
Residential real estate loans include residential mortgages, which are loans that, due to size or other attributes, do not qualify for
conventional home mortgages available-for-sale in the secondary market, second mortgages, home equity lines and conventional
mortgages that are part of a broad banking relationship with the Company. Residential mortgage loans are usually limited to a maximum
of 80% of collateral value at origination.
Other loans represent loans to individuals, loans to state and political subdivisions, loans to nondepository financial institutions, and loans to
purchase or are fully secured by investment securities. Credit risk is managed by thoroughly reviewing the creditworthiness of the borrowers
prior to origination and thereafter.
39

The following table presents a breakdown of loans by NAICS code at the periods indicated:
December 31,
2024
2023
($ in thousands)
Outstanding Balance
%
Outstanding Balance
%
Accommodation and Food Services
$
1,052,105 
9 %
$
975,357 
9 %
Administrative and Support and Waste Management and Remediation Services
207,003 
2 %
215,733 
2 %
Agriculture, Forestry, Fishing and Hunting
141,339 
1 %
229,719 
2 %
Arts, Entertainment, and Recreation
139,256 
1 %
125,487 
1 %
Construction
584,421 
5 %
692,403 
6 %
Educational Services
49,942 
NM
54,044 
1 %
Finance and Insurance
2,252,420 
20 %
2,005,183 
18 %
Health Care and Social Assistance
612,767 
5 %
551,979 
5 %
Information
68,839 
1 %
97,052 
1 %
Management of Companies and Enterprises
91,890 
1 %
88,079 
1 %
Manufacturing
750,480 
7 %
704,750 
7 %
Mining, Quarrying, and Oil and Gas Extraction
5,494 
NM
32,024 
NM
Other Services (except Public Administration)
556,325 
5 %
588,449 
5 %
Professional, Scientific, and Technical Services
311,160 
3 %
326,176 
3 %
Public Administration
11,889 
NM
13,774 
NM
Real Estate and Rental and Leasing
2,904,153 
26 %
2,766,754 
25 %
Retail Trade
561,932 
5 %
513,763 
5 %
Transportation and Warehousing
286,906 
3 %
284,706 
3 %
Utilities
7,139 
NM
15,853 
NM
Wholesale Trade
517,761 
5 %
535,666 
5 %
Other
107,134 
1 %
67,167 
1 %
Total Loans
$
11,220,355 
100 %
$
10,884,118 
100 %
Includes $54.2 million and $95.0 million in animal production at December 31, 2024, and 2023, respectively and $69.4 million and $113.8 million in crop production at
December 31, 2024, and 2023, respectively.
At December 31, 2024 and 2023, the Company had an agricultural loan portfolio of $121.8 million and $229.7 million, respectively. The
Company continues to wind down this portfolio over time as the loans mature or pay down. The Company does not intend to enter into new
agricultural loans.
The following table presents a breakdown of commercial & industrial loans by size at the periods indicated:
December 31,
2024
2023
($ in thousands)
Number of
Loans
Outstanding
Balance
Average Balance
Number of
Loans
Outstanding
Balance
Average Balance
<$2 million
2,582  $
864,511  $
335 
2,466  $
850,849  $
345 
$2-5 million
343 
1,114,922 
3,251 
339 
1,114,522 
3,288 
$5-10 million
145 
1,001,137 
6,904 
139 
984,795 
7,085 
>$10 million
95 
1,736,119 
18,275 
97 
1,722,393 
17,757 
Total
3,165  $
4,716,689  $
1,490 
3,041  $
4,672,559  $
1,537 
1
1
40

The following table presents a breakdown of commercial real estate loans (investor owned and owner occupied) by size at the periods indicated:
December 31,
2024
2023
($ in thousands)
Number of
Loans
Outstanding
Balance
Average Balance
Number of
Loans
Outstanding
Balance
Average Balance
<$2 million
2,958  $
1,792,813  $
606 
3,133  $
1,867,452  $
596 
$2-5 million
443 
1,363,797 
3,079 
413 
1,265,659 
3,065 
$5-10 million
114 
765,059 
6,711 
118 
793,837 
6,727 
>$10 million
65 
1,053,118 
16,202 
57 
876,623 
15,379 
Total
3,580  $
4,974,787  $
1,390 
3,721  $
4,803,571  $
1,291 
The Company had $513.7 million and $482.0 million of investor owned office real estate loans as of December 31, 2024 and 2023, respectively.
The Company also had $322.5 million and $271.8 million of multifamily commercial real estate loans as of December 31, 2024 and 2023,
respectively.
The following table presents a breakdown of construction loans by size at the periods indicated:
December 31,
2024
2023
($ in thousands)
Number of
Loans
Outstanding
Balance
Average Balance
Number of
Loans
Outstanding
Balance
Average Balance
<$2 million
303 
$
128,236  $
423 
355 
$
143,461  $
404 
$2-5 million
52 
162,936 
3,133 
60 
190,857 
3,181 
$5-10 million
27 
201,108 
7,448 
23 
160,228 
6,966 
>$10 million
25 
398,779 
15,951 
17 
265,879 
15,640 
Total
407 
$
891,059  $
2,189 
455 
$
760,425  $
1,671 
The following table presents a breakdown of residential loans by size at the periods indicated:
December 31,
2024
2023
($ in thousands)
Number of
Loans
Outstanding
Balance
Average Balance
Number of
Loans
Outstanding
Balance
Average Balance
<$2 million
2,000  $
275,321  $
138 
2,130  $
284,594  $
134 
$2-5 million
19 
62,409 
3,285 
18 
58,337 
3,241 
$5-10 million
3 
21,533 
7,177 
4 
29,257 
7,314 
Total
2,022  $
359,263  $
178 
2,152  $
372,188  $
173 
41

The following table presents a breakdown of other loans by size at the periods indicated:
December 31,
2024
2023
($ in thousands)
Number of
Loans
Outstanding
Balance
Average Balance
Number of
Loans
Outstanding
Balance
Average Balance
<$2 million
1,023  $
92,471  $
90 
1,171  $
105,759  $
90 
$2-5 million
20 
65,074 
3,254 
18 
60,801 
3,378 
$5-10 million
6 
38,714 
6,453 
7 
44,593 
6,370 
>$10 million
4 
82,298 
20,574 
4 
64,222 
16,056 
Total
1,053  $
278,557  $
265 
1,200  $
275,375  $
229 
The following table presents a breakdown of total loans by geographic region at the periods indicated:
December 31,
($ in thousands)
2024
2023
Midwest
$
3,201,313 
$
3,338,308 
Southwest
1,784,824 
1,565,852 
West
1,855,380 
1,813,239 
Specialty and other loans
4,378,838 
4,166,719 
Total
$
11,220,355 
$
10,884,118 
The following table presents a breakdown of total loans by MSA, excluding specialty and other loans, at the periods indicated:
December 31,
($ in thousands)
2024
2023
St. Louis, MO-IL MSA
$
2,225,856 
$
2,382,192 
Los Angeles-Long Beach-Santa Ana, CA MSA
1,557,990 
1,561,720 
Phoenix-Mesa-Scottsdale, AZ MSA
993,239 
899,768 
Kansas City, MO-KS MSA
975,457 
953,557 
San Diego-Carlsbad-San Marcos, CA MSA
297,359 
234,808 
Dallas-Fort Worth-Arlington, TX MSA
185,242 
155,459 
Albuquerque, NM MSA
211,642 
183,813 
Santa Fe, NM MSA
151,883 
167,321 
Las Vegas-Paradise, NV MSA
165,485 
83,737 
All other MSAs
77,364 
95,024 
Specialty and other loans
4,378,838 
4,166,719 
Total
$
11,220,355 
$
10,884,118 
Loan guarantees, primarily on SBA 7(a) loans, totaled $947.7 million and $932.1 million at December 31, 2024 and 2023, respectively.
42

The following table sets forth additional information on certain categories of loans that are included in total loans above at the periods indicated:
($ in thousands)
December 31,
2024
December 31,
2023
Increase (decrease)
SBA loans
1,298,007 
1,281,632 
16,375 
1 %
Sponsor finance
782,722 
872,264 
(89,542)
(10)%
Life insurance premium finance
1,114,299 
956,162 
158,137 
17 %
Tax credits
760,229 
734,594 
25,635 
3 %
The sponsor finance portfolio is primarily comprised of loans in the manufacturing and wholesale trade sectors. It includes mid-market company
mergers and acquisitions, targeted private equity firms, principally SBICs, and senior debt financing to portfolio companies.
The life insurance premium finance category specializes in financing whole life insurance premiums utilized in high net worth estate planning,
through relationships with boutique estate planners throughout the United States.
The tax credit portfolio includes tax credit-related lending on affordable housing projects funded through the use of
federal and state low income housing tax credits. In addition, we provide leveraged and other loans on projects funded through the CDFI New
Markets Tax Credit Program. This portfolio also includes tax credit brokerage through 10-year streams of state tax credits from affordable
housing development funds. The tax credits are sold to clients and other individuals for tax planning purposes.
SBA loans are originated under the SBA 7(a) program and are primarily owner-occupied, commercial real estate loans secured by a 1st lien.
These loans predominantly have a 75% portion guaranteed by the SBA.
Significant loan concentrations are considered to exist for a financial institution when there are amounts loaned to numerous borrowers engaged
in similar activities that would cause them to be similarly impacted by economic or other conditions. At December 31, 2024, no significant
concentrations exceeding 10% of total loans existed in the Company’s loan portfolio, except as described above.
43

The following table presents the maturity distribution of loans at December  31, 2024 categorized by fixed or variable interest rates, net of
unearned loan fees:
($ in thousands)
Due in One
 Year or Less 
After One
Through Five
Years
After Five
Through
Fifteen Years
After
Fifteen Years
Total
Percent of
Total Loans
Fixed Rate Loans
Commercial and industrial
$
107,243 
$
592,690 
$
591,926 
$
12,247 
$
1,304,106 
12 %
Real estate:
Commercial
394,125 
1,823,671 
343,165 
180,183 
2,741,144 
24 %
Construction and land development
20,706 
129,788 
15,133 
2,925 
168,552 
2 %
Residential
28,007 
88,772 
13,384 
22,411 
152,574 
1 %
Other
928 
53,078 
77,201 
36,309 
167,516 
1 %
Total
$
551,009 
$
2,687,999 
$
1,040,809 
$
254,075 
$
4,533,892 
40 %
Variable Rate Loans
Commercial and industrial
$
1,258,702 
$
1,935,810 
$
211,279 
$
6,792 
$
3,412,583 
30 %
Real estate:
Commercial
229,130 
419,591 
386,634 
1,198,288 
2,233,643 
20 %
Construction and land development
372,803 
171,872 
97,920 
79,912 
722,507 
7 %
Residential
34,294 
23,049 
58,288 
91,058 
206,689 
2 %
Other
52,632 
13,054 
45,237 
118 
111,041 
1 %
Total
$
1,947,561 
$
2,563,376 
$
799,358 
$
1,376,168 
$
6,686,463 
60 %
Total Loans
Commercial and industrial
$
1,365,945 
$
2,528,500 
$
803,205 
$
19,039 
$
4,716,689 
42 %
Real estate:
Commercial
623,255 
2,243,262 
729,799 
1,378,471 
4,974,787 
44 %
Construction and land development
393,509 
301,660 
113,053 
82,837 
891,059 
9 %
Residential
62,301 
111,821 
71,672 
113,469 
359,263 
3 %
Other
53,560 
66,132 
122,438 
36,427 
278,557 
2 %
Total
$
2,498,570 
$
5,251,375 
$
1,840,167 
$
1,630,243 
$
11,220,355 
100 %
Includes loans with no stated maturity and overdraft lines of credit.
The majority of variable loans are based on the prime rate or SOFR. At December 31, 2024, $4.6 billion or 68% of variable rate loans were
subject to an interest rate floor. Most variable rate loan originations have one-to three-year maturities. Management monitors this mix as part of
its interest rate risk management. The Company has also entered into interest rate hedges to reduce the cash flow impact of changes in interest
rates on the variable rate loan portfolio. These hedges, which include interest rate swaps and collars, had a notional amount of $400.0 million and
$350.0 million at December 31, 2024 and 2023, respectively. See “Interest Rate Risk” of this MD&A section for additional information.
(1)
(1) 
44

Provision and Allowance for Credit Losses
The following table presents the components of the provision for credit losses for the periods indicated:
December 31,
($ in thousands)
2024
2023
Provision for credit losses on loans
$
20,629 
$
35,883 
Provision for available-for-sale securities
— 
4,281 
Benefit for off-balance sheet commitments
(586)
(5,450)
Provision / (Benefit) for held-to-maturity securities
(528)
50 
Charge-offs of accrued interest
1,993 
1,841 
Provision for credit losses
$
21,508 
$
36,605 
The provision for credit losses, which includes a provision for losses on unfunded commitments, is a charge to earnings to maintain the ACL at a
level consistent with management’s assessment of expected losses in the loan portfolio at the balance sheet date. The Company also records
reversals of interest on nonaccrual loans and interest recoveries directly through the provision of credit losses.
The CECL methodology requires economic forecasts to be factored into determining estimated losses. As a result, CECL is designed to typically
require a higher level of provision at the start of an economic downturn. The decrease in the provision for credit losses in 2024 was primarily due
to improved credit quality, including a reduction in net charge-offs. The higher provision for credit losses in the prior year was primarily due to
loan growth, net charge-offs and the increase in nonperforming loans. The provision for credit losses in 2023 also included the impact of the
impairment of an available-for-sale investment security, related to a subordinated debt security in a publicly-traded bank that failed in the first
quarter of 2023.
To the extent the Company does not recognize charge-offs and economic forecasts improve in future periods, the Company could recognize a
reversal of provision for credit losses. Conversely, if economic conditions and the Company’s forecast worsens, the Company could recognize
elevated levels of provision for credit losses. The provision is also reflective of charge-offs in the period.
The following table summarizes the allocation of the ACL on loans:
December 31,
($ in thousands)
2024
2023
Balance at End of Period Applicable to:
Amount
Percent of loans in
each category to total
loans
Amount
Percent of loans in
each category to total
loans
Commercial and industrial
$
63,231 
42.1 % $
58,886 
42.9 %
Real estate:
Commercial
54,617 
44.3 %
54,685 
44.1 %
Construction and land development
9,837 
8.0 %
10,198 
7.0 %
Residential
6,534 
3.2 %
6,142 
3.4 %
Other
3,731 
2.4 %
4,860 
2.6 %
Total allowance
$
137,950 
100.0 % $
134,771 
100.0 %
The allowance for credit losses was 1.23% of total loans at December 31, 2024, compared to 1.24%, and 1.41%, at December 31, 2023 and
2022, respectively. The decrease in the allowance to total loans ratio in 2024 compared to 2023 was primarily due to a shift in the mix of the loan
portfolio to categories with lower reserve requirements, improvement in the economic forecast and net loan charge-offs of $17.5 million.
45

The following table is a summary of net charge-offs (recoveries) to average loans for the periods indicated:
December 31,
2024
2023
($ in thousands)
Net Charge-offs
(Recoveries)
Average
Loans
Net Charge-offs
(Recoveries)/Average
Loans
Net Charge-offs
(Recoveries)
Average
Loans
Net Charge-offs
(Recoveries)/Average
Loans
Commercial and industrial
$
10,425  $
5,602,957 
0.19 % $
33,257  $
4,247,091 
0.78 %
Real estate:
Commercial
3,510 
3,934,764 
0.09 %
4,446 
4,712,037 
0.09 %
Construction and land
development
3,125 
792,854 
0.39 %
(54)
712,578 
(0.01)%
Residential
(264)
352,754 
(0.07)%
(323)
362,641 
(0.09)%
Other
654 
306,583 
0.21 %
718 
290,054 
0.25 %
Total
$
17,450  $
10,989,912 
0.16 % $
38,044  $
10,324,401 
0.37 %
Excludes loans held for sale.
See “Critical Accounting Policies and Estimates” of this MD&A section for more information on the allowance for credit losses methodology.
Nonperforming loans and assets
See “Item 8. Note 1 – Summary of Significant Accounting Policies” for more information on nonaccrual loans and other real estate. The
following table presents the categories of nonperforming assets and other ratios, excluding government guaranteed portions, as of the dates
indicated.
 
December 31,
($ in thousands)
2024
2023
Non-accrual loans
$
42,667 
$
43,181 
Loans past due 90 days or more and still accruing interest
20 
547 
Total nonperforming loans
42,687 
43,728 
Other real estate
3,955 
5,736 
Total nonperforming assets
$
46,642 
$
49,464 
Total assets
$
15,596,431 
$
14,518,590 
Total loans
11,220,355 
10,884,118 
Total allowance for credit losses
137,950 
134,771 
ACL to nonaccrual loans
323 %
312 %
ACL to nonperforming loans
323 %
308 %
ACL to total loans
1.23 %
1.24 %
Nonaccrual loans to total loans
0.38 %
0.40 %
Nonperforming loans to total loans
0.38 %
0.40 %
Nonperforming assets to total assets
0.30 %
0.34 %
(1)
(1)
(1) 
46

Nonperforming loans based on loan type were as follows:
 
($ in thousands)
December 31, 2024
Number of
loans
December 31, 2023
Number of
loans
Commercial and industrial
$
15,821 
37 %
23 
$
7,756 
18 %
15 
Commercial real estate
25,096 
59 %
33 
33,739 
77 %
27 
Construction and land development
1,503 
3 %
2 
1,269 
3 %
3 
Residential real estate
258 
1 %
1 
959 
2 %
1 
Other
9 
NM
4 
5 
— %
2 
Total
$
42,687 
100 %
63 
$
43,728 
100 %
48 
The following table summarizes the changes in nonperforming loans: 
 
Year ended December 31,
($ in thousands)
2024
2023
Nonperforming loans, beginning of period
$
43,728 
$
9,981 
Additions to nonaccrual loans
55,747 
109,766 
Charge-offs
(21,874)
(43,215)
Principal payments
(29,000)
(25,871)
Moved to other real estate
(5,914)
(6,933)
Nonperforming loans, end of period
$
42,687 
$
43,728 
Nonperforming loans at December  31, 2024 decreased $1.0 million, or 2%, when compared to December  31, 2023. The decrease in
nonperforming loans during 2024 was primarily from principal payments of $29.0 million and charge-offs of $21.9 million, partially offset by
additions to nonaccrual loans of $55.7 million.
Other real estate
The following table summarizes the changes in other real estate:
 
Year ended December 31,
($ in thousands)
2024
2023
Other real estate, beginning of period
$
5,736 
$
269 
Additions
6,559 
5,736 
Changes in valuation allowance
(156)
— 
Sales
(8,184)
(269)
Other real estate, end of period
$
3,955 
$
5,736 
47

Investments
At December 31, 2024, our portfolio of investment securities was $2.8 billion, or 18% of total assets, compared to $2.4 billion, or 16% of total
assets as of December 31, 2023. The portfolio is comprised of both available-for-sale and held-to-maturity securities.
The table below sets forth the carrying value of investment securities, excluding the allowance for credit losses:
December 31,
2024
2023
($ in thousands)
Amount
%
Amount
%
Obligations of U.S. Government sponsored enterprises
$
276,040 
9.9 %
$
296,446 
12.5 %
Obligations of states and political subdivisions
1,168,256 
41.9 %
1,007,870 
42.5 %
Agency mortgage-backed securities
1,075,306 
38.5 %
752,481 
31.8 %
U.S. Treasury Bills
128,893 
4.6 %
181,701 
7.7 %
Corporate debt securities
142,967 
5.1 %
130,994 
5.5 %
Total
$
2,791,462 
100.0 %
$
2,369,492 
100.0 %
The allowance for credit losses on held-to-maturity debt securities was $0.3 million and $0.8 million at December 31, 2024 and 2023,
respectively. The Company had no debt securities classified as trading at December 31, 2024, or 2023.
The following table summarizes contractual maturity and tax-equivalent yields on the investment portfolio at December 31, 2024:
 Within 1 year
 1 to 5 years
 5 to 10 years
 Over 10 years
 Total
($ in thousands)
Amount
Yield
Amount
Yield
Amount
Yield
Amount
Yield
Amount
Yield
Obligations of U.S. Government-sponsored
enterprises
$
28,053 
1.0 %
$
207,431 
1.8 %
$
30,048 
4.3 %
$
10,508 
2.1 %
$
276,040 
2.0 %
Obligations of states and political subdivisions
1,900 
3.6 %
23,914 
2.5 %
324,161 
3.4 %
818,281 
3.7 %
1,168,256 
3.6 %
Agency mortgage-backed securities
50,905 
3.0 %
24,719 
2.9 %
59,906 
3.6 %
939,776 
3.9 %
1,075,306 
3.8 %
U.S. Treasury Bills
80,060 
4.1 %
48,833 
2.9 %
— 
— %
— 
— %
128,893 
3.6 %
Corporate debt securities
5,008 
3.3 %
114,163 
3.3 %
23,796 
4.9 %
— 
— %
142,967 
3.6 %
Total
$
165,926 
3.2 %
$
419,060 
2.4 %
$
437,911 
3.6 %
$
1,768,565 
3.8 %
$
2,791,462 
3.5 %
Yields on tax-exempt securities are computed on a taxable equivalent basis using a tax rate of 24.8%. Actual maturities can differ from
contractual maturities, as borrowers may have the right to call or repay obligations with or without prepayment penalties.
Other investments primarily consist of the FHLB capital stock, common stock investments related to our trust preferred securities, community
development funds, and other investments in private equity funds, primarily SBICs. These investments do not have a stated maturity.
December 31,
2024
2023
($ in thousands)
Amount
%
Amount
%
FHLB capital stock
$
8,704 
12.0 %
$
7,824 
11.8 %
Other investments
64,080 
88.0 %
58,371 
88.2 %
Total
$
72,784 
100.0 %
$
66,195 
100.0 %
48

Deposits
The following table shows the breakdown of deposits by type:
Years ended December 31,
$ Increase
(decrease)
% Increase (decrease)
($ in thousands)
2024
2023
2024 vs. 2023
2024 vs. 2023
Noninterest-bearing demand accounts
$
4,484,072 
$
3,958,743 
$
525,329 
13.3 %
Interest-bearing demand accounts
3,175,292 
2,950,259 
225,033 
7.6 %
Money market accounts
3,564,063 
3,399,280 
164,783 
4.8 %
Savings accounts
553,461 
595,175 
(41,714)
(7.0)%
Certificates of deposit:
Brokered
484,588 
482,759 
1,829 
0.4 %
Customer
885,016 
790,155 
94,861 
12.0 %
Total deposits
$
13,146,492 
$
12,176,371 
$
970,121 
8.0 %
Noninterest-bearing deposits / Total deposits
34 %
33 %
Total deposits increased $970.1 million, primarily due to client deposit growth. Brokered certificates of deposit increased $1.8  million, to
$484.6 million at December 31, 2024. Brokered certificates of deposit are used for term liquidity purposes in place of FHLB borrowings. The
brokered certificates of deposit balance has a weighted average cost of 4.50% and a weighted average remaining term of 9 months at December
31, 2024. The Company has a deposit vertical portfolio focusing primarily on property management, community associations, and legal industry
and escrow services. These deposits totaled $3.4 billion and $2.8 billion at the end of 2024 and 2023, respectively.
The following table shows the average balance and average rate of the Company’s deposits by type:
Years ended December 31,
2024
2023
2022
($ in thousands)
Average
Balance
Average Rate
Paid
Average
Balance
Average Rate
Paid
Average
Balance
Average Rate
Paid
Noninterest-bearing deposit accounts
$
4,042,368 
— % $
4,131,163 
— % $
4,805,549 
— %
Interest-bearing demand accounts
3,033,616 
2.54 %
2,559,238 
1.84 %
2,318,363 
0.30 %
Money market accounts
3,494,497 
3.65 %
3,043,794 
3.05 %
2,781,579 
0.69 %
Savings accounts
567,147 
0.22 %
668,368 
0.15 %
819,043 
0.04 %
Certificates of deposit:
Brokered
519,279 
4.73 %
557,761 
4.44 %
128,120 
1.08 %
Customer
851,730 
4.01 %
640,790 
2.81 %
441,152 
0.48 %
Total interest-bearing deposits
$
8,466,269 
3.13 % $
7,469,951 
2.46 % $
6,488,257 
0.46 %
Total average deposits
$
12,508,637 
2.12 % $
11,601,114 
1.58 % $
11,293,806 
0.27 %
Average total deposits were $12.5 billion for the year ended December 31, 2024, an increase of $907.5 million, or 8%, from December 31, 2023.
The increase in 2024 was primarily due to organic growth in money market and interest-bearing demand accounts.
49

The following table sets forth the maturities of estimated uninsured certificates of deposit as of December 31, 2024. Uninsured deposits are
amounts estimated to exceed the FDIC deposit insurance limit and are not subject to any federal or state insurance program.
($ in thousands)
Total
Three months or less
$
142,678 
Over three through six months
52,082 
Over six through twelve months
51,355 
Over twelve months
22,102 
Total
$
268,217 
As of December 31, 2024, estimated uninsured deposits totaled $4.5 billion, including $268.2 million of certificates of deposit. At December 31,
2023 estimated uninsured deposits totaled $4.3 billion. Estimated uninsured deposits include $0.5 billion of balances that are collateralized or
secured with third party insurance at December 31, 2024 and 2023, respectively.
Shareholders’ equity
Shareholders’ equity totaled $1.8 billion at December 31, 2024, an increase of $107.9 million, or 6%, from December 31, 2023.
Significant activity during the year ended December 31, 2024 included the following:
•
Increase from net income of $185.3 million;
•
Net decrease in fair value of available-for-sale securities and cash flow hedges of $15.7 million;
•
Decrease from dividends paid on common stock of $39.6 million and preferred stock of $3.8 million
•
Decrease from share repurchases of $29.6 million, pursuant to the Company’s publicly-announced stock repurchase program.
Liquidity and Capital Resources
Liquidity
The objective of liquidity management is to ensure we have the ability to generate sufficient cash or cash equivalents in a timely and cost-
effective manner to meet our commitments as they become due. Typical demands on liquidity are changes in deposit levels, maturing time
deposits which are not renewed, and fundings under credit commitments to customers. Funds are available from a number of sources, such as the
core deposit base and loan and security repayments and maturities.
Liquidity is provided from lines of credit with the FHLB, the Federal Reserve, and correspondent banks; the ability to acquire large and brokered
deposits; sales of the securities portfolio; and the ability to sell loan participations to other banks and loans on the secondary market. These
alternatives are an important part of our liquidity plan and provide flexibility and efficient execution of the asset-liability management strategy.
The Company’s Asset-Liability Management Committee oversees our liquidity position, the parameters of which are approved by the Bank’s
Board of Directors. Our liquidity position is monitored daily. Our liquidity management framework includes measurement of several key
elements, such as a loan to deposit ratio, a liquidity ratio, and a dependency ratio. The Company’s liquidity framework also incorporates
contingency planning to assess the nature and volatility of funding sources and to determine alternatives to these sources. While core deposits
and loan and investment repayments are principal sources of liquidity, funding diversification is another key element of liquidity management
and is achieved by strategically varying depositor types, terms, funding markets, and instruments.
Liquidity from assets is available primarily from cash balances and the investment portfolio. Cash and interest-bearing deposits with other banks
totaled $764.2 million at December 31, 2024, compared to $433.0 million at December 31, 2023. The increase in cash balances during 2024 is
due to deposit growth exceeding loan growth. The
50

increase in market interest rates in 2022 - 2023 increased the competitive environment for deposits, as depositors had more alternatives to bank
deposit accounts. Successful marketing efforts increased total deposits in 2024. Investment securities are another important tool to the
Company’s liquidity objectives. Securities totaled $2.8 billion at December 31, 2024, and included $1.5 billion pledged as collateral for deposits
of public institutions, treasury, loan notes, and other requirements. The remaining $1.3 billion could be pledged or sold to enhance liquidity, if
necessary.
Available on- and off-balance sheet liquidity sources include the following items:
($ in thousands)
December 31, 2024
Federal Reserve Bank borrowing capacity
$
2,751,533 
FHLB borrowing capacity
1,304,235 
Unpledged securities
1,325,619 
Federal funds lines (7 correspondent banks)
140,000 
Cash and interest-bearing deposits
764,170 
Holding Company line of credit
25,000 
Total
$
6,310,557 
The Company also has a portfolio of SBA guaranteed loans, a portion of which could be sold in the secondary market to generate earnings and
liquidity. The guaranteed portion of SBA loans totaling $23.1 million and $42.1 million were sold during 2024 and 2023.
Liability liquidity funding sources are available to increase financial flexibility. In addition to amounts borrowed at December 31, 2024, the
Company could borrow an additional $1.3 billion from the FHLB of Des Moines under blanket loan pledges and has additional real estate loans
that could be pledged. The Company also has $2.8 billion available from the Federal Reserve Bank under a pledged loan agreement. The
Company also has unsecured federal funds lines with seven correspondent banks totaling $140 million.
In the normal course of business, the Company enters into certain forms of off-balance sheet transactions, including unfunded loan commitments
and letters of credit. These transactions are managed through the Company’s various risk management processes. Management considers both
on-balance sheet and off-balance sheet transactions in its evaluation of the Company’s liquidity. The Company has $3.1 billion in unused
commitments to extend credit as of December  31, 2024. While this commitment level would exhaust the majority the Company’s current
liquidity resources, the nature of these commitments is such that the likelihood of funding them in the aggregate at any one time is low.
At the holding company level, our primary funding sources are dividends and payments from the Bank and proceeds from the issuance of equity
(i.e. stock option exercises, stock offerings) and debt instruments. The main use of this liquidity is to provide the funds necessary to pay
dividends to shareholders, service debt, invest in subsidiaries as necessary, and satisfy other operating requirements. In 2024, the holding
company maintained a revolving line of credit for an aggregate amount up to $25 million, all of which was available at December 31, 2024. The
line of credit had a one-year term that matured in February 2025, the interest rate was one-month Term SOFR plus 185 basis points, and an
annual unused commitment fee of 0.40% was assessed. The proceeds could be used for general corporate purposes.
Strong capital ratios, credit quality and core earnings are essential to retaining cost-effective access to the wholesale funding markets.
Deterioration in any of these factors could have a negative impact on the Company’s ability to access these funding sources and, as a result, these
factors are monitored on an ongoing basis as part of the liquidity management process. The Bank is subject to regulations and, among other
things, may be limited in its ability to pay dividends or transfer funds to the parent company. Accordingly, consolidated cash flows as presented
in the consolidated statements of cash flows may not represent cash immediately available for the payment of cash dividends to the Company’s
shareholders or for other cash needs.
51

Through the normal course of operations, the Company has entered into certain contractual obligations and other commitments. Such obligations
relate to funding operations through deposits or debt issuances, as well as leases for premises and equipment. As a financial services provider,
the Company routinely enters into commitments to extend credit. While contractual obligations represent future cash requirements of the
Company, a significant portion of commitments to extend credit may expire without being drawn upon. Such commitments are subject to the
same credit policies and approval process accorded to loans made by the Company. The Company also enters into derivative contracts under
which the Company either receives cash from or pays cash to counterparties depending on changes in interest rates. Derivative contracts are
carried at fair value on the consolidated balance sheet with the fair value representing the net present value of expected future cash receipts or
payments based on market interest rates as of the balance sheet date. The fair value of these contracts changes daily as market interest rates
change. For additional information on the Company’s contractual obligations and commitments see the following footnotes in Item 8: “Note 5 –
Leases,” “Note 6 – Derivative Financial Instruments,” “Note 10 – Subordinated Debentures and Notes,” “Note 11 – Federal Home Loan Bank
Advances,” “Note 12 – Other Borrowings,” and “Note 17 – Commitments and Contingent Liabilities.”
Capital Resources
The Company and the Bank are subject to various regulatory capital requirements administered by the state and federal banking agencies. Failure
to meet minimum capital requirements can initiate certain mandatory and possible additional discretionary actions by regulators that, if
undertaken, could have a direct material effect on the financial statements and results of operations of the Company. Under capital adequacy
guidelines and the regulatory framework for prompt corrective action, the Company and its bank affiliate must meet specific capital guidelines
that involve quantitative measures of assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices.
The banking affiliate’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk
weightings and other factors.
 
Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts
and ratios (set forth in the following table) of total and tier 1 capital to risk-weighted assets, and of tier 1 capital to average assets. To be
categorized as “well-capitalized”, banks must maintain minimum total risk-based (10%), tier 1 risk-based (8%), common equity tier 1 risk-based
(6.5%), and tier 1 leverage ratios (5%). As of December 31, 2024, and December 31, 2023, the Company and the Bank met all capital adequacy
requirements to which they are subject.
 
The Bank met the definition of “well-capitalized” at each of December 31, 2024 and 2023. Refer to “Item 8. Note 14 – Regulatory Capital” for a
summary of our risk-based capital and leverage ratios. The following table summarizes the Company’s capital ratios:
December 31, 2024
December 31, 2023
($ in thousands)
EFSC
Bank
EFSC
Bank
To Be Well-
Capitalized
Minimum Ratio
with CCB
Common Equity Tier 1 Capital to Risk Weighted
Assets
11.8 %
12.4 %
11.3 %
12.2 %
6.5 %
7.0 %
Tier 1 Capital to Risk Weighted Assets
13.1 %
12.4 %
12.7 %
12.2 %
8.0 %
8.5 %
Total Capital to Risk Weighted Assets
14.6 %
13.4 %
14.2 %
13.2 %
10.0 %
10.5 %
Leverage Ratio (Tier 1 Capital to Average Assets)
11.1 %
10.5 %
11.0 %
10.6 %
5.0 %
N/A
Tangible common equity to tangible assets
9.05 %
8.96 %
Common equity tier 1 capital
$
1,505,162 
$
1,578,293 
$
1,387,802 
$
1,493,105 
Tier 1 capital
1,670,810 
1,578,353 
1,553,448 
1,493,163 
Total risk-based capital
1,864,334 
1,708,626 
1,732,501 
1,608,966 
Not a required regulatory capital ratio
1
1 
52

Total regulatory capital includes $63.3 million of subordinated debentures that were issued in 2020 at a fixed rate of 5.75%. The interest rate on
these debentures resets to a floating rate based on 3 month term SOFR plus a spread of 5.66% in June of 2025. When the interest rate resets, the
debentures become callable and the inclusion in regulatory capital begins to phase out over a five year period.
The Company believes the tangible common equity and regulatory capital ratios are important measures of capital strength. The tangible
common equity to tangible assets ratio is considered a non-GAAP measure. The tables included in this MD&A section under the caption “Use of
Non-GAAP Financial Measures” reconcile these ratios to U.S. GAAP. 
Risk Management
Market risk arises from exposure to changes in interest rates and other relevant market rate or price risk. The Company faces market risk in the
form of interest rate risk through transactions other than trading activities. Market risk from these activities, in the form of interest rate risk, is
measured and managed through a number of methods. The Company uses financial modeling techniques to measure interest rate risk. These
techniques measure the sensitivity of future earnings due to changing interest rate environments. Guidelines established by the Bank’s
Asset/Liability Management Committee and approved by the Bank’s Board of Directors are used to monitor exposure of earnings at risk.
General interest rate movements are used to develop sensitivity as management believes it has no primary exposure to a specific point on the
yield curve. These limits are based on the Company’s exposure to immediate and sustained parallel rate movements, either upward or downward.
The Company does not have any direct market risk from commodity exposures.
Interest Rate Risk 
Our interest rate risk management practices are aimed at optimizing net interest income, while guarding against deterioration that could be
caused by certain interest rate scenarios. Interest rate sensitivity varies with different types of interest-earning assets and interest-bearing
liabilities. We attempt to maintain interest-earning assets, comprised primarily of both loans and investments, and interest-bearing liabilities,
comprised primarily of deposits, maturing or repricing in similar time horizons in order to manage any impact from market interest rate changes
according to our risk tolerance. The Company uses an earnings simulation model to measure earnings sensitivity to changing rates.
The Company determines the sensitivity of its short-term future earnings to a hypothetical plus or minus 100 to 300 basis point parallel rate
shock through the use of simulation modeling. The simulation of earnings includes the modeling of the balance sheet as an ongoing entity. Future
business assumptions involving administered rate products, prepayments for future rate-sensitive balances, and the reinvestment of maturing
assets and liabilities are included. These items are then modeled to project net interest income based on a hypothetical change in interest rates.
The resulting net interest income for the next 12-month period is compared to the net interest income amount calculated using flat rates. This
difference represents the Company’s earnings sensitivity to a positive or negative parallel rate shock.
53

The following table summarizes the projected impact of interest rate shocks on net interest income:
Annual % change
in net interest income
At December 31,
Rate Shock
2024
2023
+ 300 bp
7.9%
9.8%
+ 200 bp
5.4%
6.6%
+ 100 bp
2.7%
3.3%
 - 100 bp
(3.0)%
(3.5)%
 - 200 bp
(6.0)%
(7.3)%
 - 300 bp
(8.5)%
(11.2)%
In addition to the rate shocks shown in the table above, the Company models net interest income under various dynamic interest rate scenarios.
In general, changes in interest rates are positively correlated with changes in net interest income.
The Company occasionally uses interest rate derivative instruments as an asset/liability management tool to hedge mismatches in interest rate
exposure indicated by the net interest income simulation described above. They are used to modify the Company’s exposures to interest rate
fluctuations and provide more stable spreads between loan yields and the rate on their funding sources. At December 31, 2024, the Company had
derivative contracts to manage interest rate risk, including $400.0 million in notional value on derivatives to hedge the cash flows on floating
rate loans and $32.1 million in notional value on derivatives on floating rate debt. Derivative financial instruments are discussed in “Item 8.
Financial Statements and Supplementary Data – Note 6 – Derivative Financial Instruments.”
The FCA ceased publishing the most common USD LIBOR settings (overnight, 1-month. 3-month, 6-month and 12-month) after September 30,
2024. LIBOR was the most liquid and common interest rate index in the world and was commonly referenced in financial instruments. With the
cessation of LIBOR, the Company has selected term SOFR as the replacement index for the majority of its variable rate loans and began
providing customer notifications in early 2023. The Company ceased using LIBOR and ICE swap rates in new contracts and began issuing
SOFR based loans in December 2021.
The Company had $6.7 billion in variable rate loans as of December 31, 2024. Of these loans, $4.6 billion have an interest rate floor and nearly
all of those loans were at or above the floor. Variable rate loans include $2.7 billion indexed to the prime rate, $3.2 billion are indexed to SOFR,
and $807.4 million indexed to other rates.
Changes in interest rates will also have an effect on noninterest expense. Certain deposit accounts receive an earnings credit that provides a
reimbursement for costs clients incur on the accounts. As interest rates increase, the amount available for reimbursement also increases, resulting
in an increase to noninterest expense. Conversely, a decrease in interest rates would reduce the amount available for reimbursement and decrease
noninterest expense.
Critical Accounting Policies and Estimates
The following accounting policies are considered most critical to the understanding of the Company’s financial condition and results of
operations. These critical accounting policies require management’s most difficult, subjective and complex judgments about matters that are
inherently uncertain. Because these estimates and judgments are based on current circumstances, they may change over time or prove to be
inaccurate based on experience. In the event different assumptions or conditions were to prevail, and depending upon the severity of such
changes, the possibility of a materially different financial condition and/or results of operations could reasonably be expected. The impact and
any associated risks related to our critical accounting policies on our business operations are described throughout “Management’s Discussion
and Analysis of Financial Condition and Results of Operations,” where such policies affect our reported and expected financial results. For a
detailed
54

discussion on the application of these and other accounting policies, see “Item 8. Note 1 – Summary of Significant Accounting Policies.”
The Company has prepared all of the consolidated financial information in this report in accordance with GAAP. The Company makes estimates
and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the
consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. These estimates and
assumptions are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis
using loss experience and other factors, including the current economic environment, which management believes to be reasonable under the
circumstances. We adjust such estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be
determined with precision, actual results could differ significantly from these estimates. Changes in estimates resulting from continuing changes
in the economic environment will be reflected in the financial statements in future periods. There can be no assurances that actual results will not
differ from those estimates.
Allowance for Credit Losses
The Company maintains separate allowances for funded loans, unfunded loans, and held-to-maturity securities, collectively referred to as the
ACL. The ACL is a valuation account to adjust the cost basis to the amount expected to be collected, based on management’s experience, current
conditions, and reasonable and supportable forecasts. For purposes of determining the allowance for funded and unfunded loans, the portfolios
are segregated into pools that share similar risk characteristics that are then further segregated by credit grades. Loans that do not share similar
risk characteristics are evaluated on an individual basis and are not included in the collective evaluation. The Company estimates the amount of
the allowance based on loan loss experience, adjusted for current and forecasted economic conditions, including unemployment, changes in
GDP, and commercial and residential real estate prices. The Company’s forecast of economic conditions uses internal and external information
and considers a weighted average of a baseline, upside, and downside scenarios. Because economic conditions can change and are difficult to
predict, the anticipated amount of estimated loan defaults and losses, and therefore the adequacy of the allowance, could change significantly and
have a direct impact on the Company’s credit costs. The Company’s allowance for credit losses on loans was $138.0 million at December 31,
2024 based on the weighting of the different economic scenarios. As a hypothetical example, if the Company had only used the upside scenario,
the allowance would have decreased $27.7 million. Conversely, the allowance would have increased $47.4 million using only the downside
scenario.
Income Taxes
Management uses certain assumptions and estimates in determining income taxes payable or refundable for the current year, deferred income tax
assets and liabilities and income tax expense. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets
and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are
expected to be recovered or settled. If current available information raises doubt as to the realization of the deferred tax assets, a valuation
allowance may be established. We consider the determination of this valuation allowance to be a critical accounting policy because of the need to
exercise significant judgment in evaluating the amount and timing of recognition of deferred tax liabilities and assets, including projections of
future taxable income. These judgments and estimates are reviewed on a continual basis as regulatory and business factors change. A valuation
allowance for deferred tax assets may be required in the future if the amounts of taxes recoverable through loss carry backs decline, if we project
lower levels of future taxable income, or we project lower levels of tax planning strategies. Such valuation allowance would be established
through a charge to income tax expense that would adversely affect our operating results.
Effects of New Accounting Pronouncements
See “Item 8. Note 1 – Summary of Significant Accounting Policies – Recent Accounting Pronouncements” for information on recent accounting
pronouncements and their impact, if any, on our consolidated financial statements.
55

Use of Non-GAAP Financial Measures
The Company’s accounting and reporting policies conform to U.S. GAAP and the prevailing practices in the banking industry. However, the
Company provides other financial measures, such as core efficiency ratio, tangible common equity ratio, return on average tangible common
equity, and tangible book value per common share, in this report 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 core efficiency ratio, tangible common equity ratio, return on average tangible common equity, and tangible book
value per common share, 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 core conversion expenses, FDIC special assessment, merger-related expenses, facilities
charges, and the gain or loss on sale of other real estate owned and investment securities, that 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 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. 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 measure for the periods indicated.
56

Reconciliations of Non-GAAP Financial Measures
Pre-Provision Net Revenue (PPNR) and Pre-Provision Net Revenue Return on Average Assets (PPNR ROAA)
For the years ended December 31,
($ in thousands)
2024
2023
2022
Net interest income
$
568,096 
$
562,592 
$
473,903 
Noninterest income
69,703 
68,725 
59,162 
FDIC special assessment
625 
2,412 
— 
Core conversion expense
4,868 
— 
— 
Less gain on sale of investment securities
— 
601 
— 
Less gain (loss) on sale of other real estate owned
3,089 
187 
(93)
Less noninterest expense
385,047 
348,186 
274,216 
PPNR (non-GAAP)
$
255,156 
$
284,755 
$
258,942 
Average assets
$
14,841,690 
$
13,805,236 
$
13,319,624 
PPNR ROAA (non-GAAP)
1.72 %
2.06 %
1.94 %
Tangible Common Equity, Tangible Book Value per Share, and Tangible Common Equity Ratio
At December 31,
($ and shares in thousands, except per share data)
2024
2023
2022
Shareholders' equity (GAAP)
$
1,824,002 
$
1,716,068 
$
1,522,263 
Less preferred stock
71,988 
71,988 
71,988 
Less goodwill
365,164 
365,164 
365,164 
Less intangible assets
8,484 
12,318 
16,919 
Tangible common equity (non-GAAP)
$
1,378,366 
$
1,266,598 
$
1,068,192 
Common shares outstanding
36,988 
37,416 
37,253 
Tangible book value per share (non-GAAP)
$
37.27 
$
33.85 
$
28.67 
Total assets (GAAP)
$
15,596,431 
$
14,518,590 
$
13,054,172 
Less goodwill
365,164 
365,164 
365,164 
Less intangible assets
8,484 
12,318 
16,919 
Tangible assets (non-GAAP)
$
15,222,783 
$
14,141,108 
$
12,672,089 
Tangible common equity to tangible assets (non-GAAP)
9.05 %
8.96 %
8.43 %
57

Return on Average Tangible Common Equity (ROATCE) and Return on Average Assets (ROAA)
At or for the years ended December 31,
($ in thousands)
2024
2023
2022
Average shareholder’s equity (GAAP)
$
1,784,175 
$
1,623,121 
$
1,498,759 
Less average preferred stock
71,988 
71,988 
71,988 
Less average goodwill
365,164 
365,164 
365,164 
Less average intangible assets
10,329 
14,531 
19,516 
Average tangible common equity (non-GAAP)
$
1,336,694 
$
1,171,438 
$
1,042,091 
Net income (GAAP)
$
185,266 
$
194,059 
$
203,043 
FDIC special assessment (after tax)
470 
1,814 
— 
Core conversion expense (after tax)
3,661 
— 
— 
Less gain on sale of investment securities (after tax)
— 
452 
— 
Less net gain (loss) on sale of other real estate owned (after tax)
2,323 
141 
(70)
Net income adjusted (non-GAAP)
$
187,074 
$
195,280 
$
203,113 
Less preferred stock dividends
3,750 
3,750 
4,041 
Net income available to common shareholders adjusted (non-GAAP)
$
183,324 
$
191,530 
$
199,072 
Return on average common equity (non-GAAP)
10.60 %
12.27 %
13.95 %
Adjusted return on average common equity (non-GAAP)
10.71 %
12.35 %
13.95 %
ROATCE (non-GAAP)
13.58 %
16.25 %
19.10 %
Adjusted ROATCE (non-GAAP)
13.71 %
16.35 %
19.10 %
Average assets
$
14,841,690 
$
13,805,236 
$
13,319,624 
Return on average assets (GAAP)
1.25 %
1.41 %
1.52 %
Adjusted return on average assets (non-GAAP)
1.26 %
1.41 %
1.52 %
Core Efficiency Ratio
For the years ended December 31,
($ in thousands)
2024
2023
2022
Net interest income (GAAP)
$
568,096 
$
562,592 
$
473,903 
Tax-equivalent adjustment
8,445 
8,079 
7,042 
Net interest income - FTE (non-GAAP)
576,541 
570,671 
480,945 
Noninterest income (GAAP)
69,703 
68,725 
59,162 
Less gain on sale of investment securities
— 
601 
— 
Less gain (loss) on sale of other real estate owned
3,089 
187 
(93)
Core revenue (non-GAAP)
$
643,155 
$
638,608 
$
540,200 
Noninterest expense (GAAP)
$
385,047 
$
348,186 
$
274,216 
Less amortization on intangibles
3,834 
4,601 
5,367 
Less core conversion expense
4,868 
— 
— 
Less FDIC special assessment
625 
2,412 
— 
Core noninterest expense (non-GAAP)
$
375,720 
$
341,173 
$
268,849 
Core efficiency ratio (non-GAAP)
58.42 %
53.42 %
49.77 %
58

ITEM 7A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Please refer to “Risk Factors” included in Item 1A and “Risk Management” and “Interest Rate Risk” included in Management’s Discussion and
Analysis under Item 7.
59

ITEM 8: FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Enterprise Financial Services Corp and Subsidiaries
Page Number
Report of Independent Registered Public Accounting Firm, PCAOB ID 34
61
Consolidated Balance Sheets at December 31, 2024 and 2023
64
Consolidated Statements of Income for the years ended December 31, 2024, 2023, and 2022
65
Consolidated Statements of Comprehensive Income for the years ended December 31, 2024, 2023, and 2022
66
Consolidated Statements of Shareholders’ Equity for the years ended December 31, 2024, 2023, and 2022
67
Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023, and 2022
68
Notes to Consolidated Financial Statements
70
60

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of Enterprise Financial Services Corp
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of Enterprise Financial Services Corp and subsidiaries (the “Company”) as of
December 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, shareholders’ equity, and cash flows, for
each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the "financial statements"). In
our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and
2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with
accounting principles generally accepted in the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the
Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated
Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 28, 2025,
expressed an unqualified opinion on the Company's internal control over financial reporting.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s
financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with
respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and
Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included
performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in
the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as
well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was
communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the
financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters
does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter
below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Allowance for Credit Losses on Loans — Refer to Note 1 to the financial statements
Critical Audit Matter Description
The Company utilizes a discounted cash flow (“DCF”) method to measure the Allowance for Credit Losses (“ACL”) on loans collectively
evaluated that are sub-segmented by credit risk levels. The DCF method incorporates assumptions for probability of default, loss given default,
prepayments and curtailments over the contractual term of the loans. In determining the probability of default, the Company utilized a regression
analysis to determine certain economic factors that are relevant loss drivers in the portfolio segments based on historical or peer evaluations.
Additionally, the Company applies qualitative adjustments to address risks not directly captured in the quantitative reserve; including to address
macroeconomic uncertainty by weighting the forecasted baseline, upside, and downside economic factors.
61

We identified the ACL on loans as a critical audit matter because of the complexity of the Company’s model and the significant assumptions
used by management. Auditing the ACL on loans required a high degree of auditor judgment and an increased extent of effort, including the need
to involve credit specialists when performing audit procedures to evaluate the reasonableness of management’s models and assumptions.
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to the Company’s ACL on loans included the following, among others:
•
We tested the design and operating effectiveness of management’s controls covering the key data, assumptions, and judgments impacting
the ACL on loans.
•
We evaluated the appropriateness of the Company’s accounting policies, methodologies, and elections involved in determining the ACL
on loans.
•
We involved credit specialists to assist us in evaluating the Company’s development of the ACL model, including the selection of and
calibration to economic factors.
•
We assessed the reasonableness of the Company’s qualitative methodology, tested key calculations utilized within the qualitative
estimate, and agreed underlying data within the calculation to source documents.
/s/ Deloitte & Touche LLP
St. Louis, Missouri
February 28, 2025
We have served as the Company’s auditor since 2010.
62

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of Enterprise Financial Services Corp
Opinion on Internal Control over Financial Reporting
We have audited the internal control over financial reporting of Enterprise Financial Services Corp and subsidiaries (the “Company”) as of
December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control
over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by
COSO.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the
consolidated financial statements as of and for the year ended December 31, 2024, of the Company and our report dated February 28, 2025,
expressed an unqualified opinion on those financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the
effectiveness of internal control over financial reporting, included in the accompanying Management’s Assessment of Internal Control over
Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.
We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with
the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included
obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating
the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A
company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance
that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and
directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any
evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate.
/s/ Deloitte & Touche LLP
St. Louis, Missouri
February 28, 2025
63

ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES
Consolidated Balance Sheets
As of December 31, 2024 and 2023
December 31,
($ in thousands, except share data)
2024
2023
Assets
 
 
Cash and due from banks
$
270,975 
$
193,275 
Federal funds sold
5,706 
2,880 
Interest-earning deposits
487,489 
236,874 
Total cash and cash equivalents
764,170 
433,029 
Interest-earning deposits greater than 90 days
1,881 
3,856 
Securities available-for-sale
1,862,270 
1,618,273 
Securities held-to-maturity, net
928,935 
750,434 
Loans held-for-sale
110 
359 
Loans
11,220,355 
10,884,118 
Allowance for credit losses on loans
(137,950)
(134,771)
Total loans, net
11,082,405 
10,749,347 
Other investments
72,784 
66,195 
Fixed assets, net
45,009 
42,681 
Goodwill
365,164 
365,164 
Intangible assets, net
8,484 
12,318 
Other assets
465,219 
476,934 
Total assets
$
15,596,431 
$
14,518,590 
Liabilities and Shareholders' equity
Noninterest-bearing demand accounts
$
4,484,072 
$
3,958,743 
Interest-bearing demand accounts
3,175,292 
2,950,259 
Money market accounts
3,564,063 
3,399,280 
Savings accounts
553,461 
595,175 
Certificates of deposit:
Brokered
484,588 
482,759 
Customer
885,016 
790,155 
Total deposits
13,146,492 
12,176,371 
Subordinated debentures and notes
156,551 
155,984 
Other borrowings
280,821 
297,829 
Other liabilities
188,565 
172,338 
Total liabilities
13,772,429 
12,802,522 
Commitments and contingent liabilities (Note 17)
Shareholders' equity:
Preferred stock, $0.01 par value; 5,000,000 shares authorized; 75,000 shares issued and outstanding,
respectively ($1,000 per share liquidation preference)
71,988 
71,988 
Common stock, $0.01 par value; 75,000,000 shares authorized; 36,987,728 and 37,416,028 shares issued and
outstanding, respectively
370 
374 
Additional paid-in capital
990,733 
995,208 
Retained earnings
877,629 
749,513 
Accumulated other comprehensive loss, net
(116,718)
(101,015)
Total shareholders' equity
1,824,002 
1,716,068 
Total liabilities and shareholders' equity
$
15,596,431 
$
14,518,590 
The accompanying notes are an integral part of these Consolidated Financial Statements.
64

ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES
Consolidated Statements of Income
Years ended December 31, 2024, 2023, and 2022
 
Year ended December 31,
($ in thousands, except per share data)
2024
2023
2022
Interest income:
Loans
$
754,930 
$
687,852 
$
456,007 
Debt securities:
Taxable
51,352 
39,510 
28,267 
Nontaxable
24,036 
22,717 
18,838 
Interest-earning deposits
18,918 
13,430 
10,599 
Dividends on equity securities
1,815 
1,410 
1,371 
Total interest income
851,051 
764,919 
515,082 
Interest expense:
Deposits
264,608 
183,723 
30,158 
Subordinated debentures and notes
10,497 
9,781 
9,166 
FHLB advances
1,691 
2,752 
599 
Other borrowings
6,159 
6,071 
1,256 
Total interest expense
282,955 
202,327 
41,179 
Net interest income
568,096 
562,592 
473,903 
Provision (benefit) for credit losses
21,508 
36,605 
(611)
Net interest income after provision (benefit) for credit losses
546,588 
525,987 
474,514 
Noninterest income:
Deposit service charges
18,344 
16,559 
18,326 
Wealth management revenue
10,452 
10,030 
10,010 
Card services revenue
9,966 
10,028 
11,551 
Tax credit income
8,954 
9,196 
2,558 
Other income
21,987 
22,912 
16,717 
Total noninterest income
69,703 
68,725 
59,162 
Noninterest expense:
Employee compensation and benefits
182,713 
164,566 
147,029 
Deposit costs
88,645 
72,293 
31,082 
Occupancy
17,231 
16,526 
17,640 
Data processing
19,671 
15,196 
13,513 
Professional fees
6,257 
5,719 
7,079 
Other expense
70,530 
73,886 
57,873 
Total noninterest expense
385,047 
348,186 
274,216 
Income before income tax expense
231,244 
246,526 
259,460 
Income tax expense
45,978 
52,467 
56,417 
Net income
$
185,266 
$
194,059 
$
203,043 
Preferred stock dividends
3,750 
3,750 
4,041 
Net income available to common shareholders
$
181,516 
$
190,309 
$
199,002 
Earnings per common share
Basic
$
4.86 
$
5.09 
$
5.32 
Diluted
4.83 
5.07 
5.31 
The accompanying notes are an integral part of these Consolidated Financial Statements.
65

ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES
Consolidated Statements of Comprehensive Income
Years ended December 31, 2024, 2023, and 2022
Year ended December 31,
($ in thousands)
2024
2023
2022
Net income
$
185,266 
$
194,059 
$
203,043 
Other comprehensive income (loss), net of tax:
Change in unrealized gain (loss) on available-for-sale securities
(9,288)
32,155 
(149,623)
Reclassification of gain on the sale of available-for-sale securities
— 
(450)
— 
Reclassification of gain on held-to-maturity securities
(2,492)
(2,605)
(2,696)
Change in unrealized gain (loss) on cash flow hedges
(5,226)
(491)
2,798 
Reclassification of loss on cash flow hedges
1,303 
708 
412 
Total other comprehensive income (loss), net
(15,703)
29,317 
(149,109)
Total comprehensive income
$
169,563 
$
223,376 
$
53,934 
The accompanying notes are an integral part of these Consolidated Financial Statements.
66

ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES
Consolidated Statements of Shareholders’ Equity
 Years ended December 31, 2024, 2023, and 2022
Preferred
Common
(in thousands, except per share data)
Shares
Amount
Shares
Amount
Treasury
Stock
Additional
Paid-in Capital
Retained
Earnings
Accumulated Other
Comprehensive
Income (Loss)
Total
Shareholders'
Equity
Balance December 31, 2021
75 
$
71,988 
37,819 
$
398 
$
(73,528)
$
1,018,799 
$
492,682 
$
18,777 
$
1,529,116 
Net income
— 
$
— 
— 
$
— 
$
— 
$
— 
$
203,043 
$
— 
$
203,043 
Other comprehensive loss
— 
— 
— 
— 
— 
— 
— 
(149,109)
(149,109)
Common stock dividends ($0.90 per
share)
— 
— 
— 
— 
— 
— 
(33,602)
— 
(33,602)
Preferred stock dividends ($53.89 per
share)
— 
— 
— 
— 
— 
— 
(4,041)
— 
(4,041)
Repurchase of common stock
— 
— 
(700)
(7)
— 
(18,867)
(14,049)
— 
(32,923)
Issuance under equity compensation
plans, net
— 
— 
134 
2 
— 
2,460 
(689)
— 
1,773 
Share-based compensation
— 
— 
— 
— 
— 
8,006 
— 
— 
8,006 
Retirement of treasury stock (1,980
shares)
— 
— 
— 
(20)
73,528 
(27,738)
(45,770)
— 
— 
Balance December 31, 2022
75 
$
71,988 
37,253 
$
373 
$
— 
$
982,660 
$
597,574 
$
(130,332)
$
1,522,263 
Net income
— 
$
— 
— 
$
— 
$
— 
$
— 
$
194,059 
$
— 
$
194,059 
Other comprehensive income
— 
— 
— 
— 
— 
— 
— 
29,317 
29,317 
Common stock dividends ($1.00 per
share)
— 
— 
— 
— 
— 
— 
(37,368)
— 
(37,368)
Preferred stock dividends ($50.00 per
share)
— 
— 
— 
— 
— 
— 
(3,750)
— 
(3,750)
Issuance under equity compensation
plans, net
— 
— 
163 
1 
— 
2,402 
(1,002)
— 
1,401 
Share-based compensation
— 
— 
— 
— 
— 
10,146 
— 
— 
10,146 
Balance December 31, 2023
75 
$
71,988 
37,416 
$
374 
$
— 
$
995,208 
$
749,513 
$
(101,015)
$
1,716,068 
Net income
— 
$
— 
— 
$
— 
$
— 
$
— 
$
185,266 
$
— 
$
185,266 
Other comprehensive loss
— 
— 
— 
— 
— 
— 
— 
(15,703)
(15,703)
Common stock dividends ($1.06 per
share)
— 
— 
— 
— 
— 
— 
(39,550)
— 
(39,550)
Preferred stock dividends ($50.00 per
share)
— 
— 
— 
— 
— 
— 
(3,750)
— 
(3,750)
Repurchase of common stock
— 
— 
(627)
(6)
— 
(16,800)
(12,835)
— 
(29,641)
Issuance under equity compensation
plans, net
— 
— 
199 
2 
— 
1,453 
(1,015)
— 
440 
Share-based compensation
— 
— 
— 
— 
— 
10,872 
— 
— 
10,872 
Balance December 31, 2024
75 
$
71,988 
36,988 
$
370 
$
— 
$
990,733 
$
877,629 
$
(116,718)
$
1,824,002 
The accompanying notes are an integral part of these Consolidated Financial Statements.
67

ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES
Consolidated Statements of Cash Flows
Years ended December 31, 2024, 2023, and 2022
 
Year ended December 31,
($ in thousands)
2024
2023
2022
Cash flows from operating activities:
 
 
Net income
$
185,266 
$
194,059 
$
203,043 
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation
5,149 
5,090 
5,573 
Provision (benefit) for credit losses
21,508 
36,605 
(611)
Deferred income taxes
(3,521)
2,380 
2,194 
Net amortization of discount/premiums on debt securities
4,090 
3,998 
5,639 
Net amortization on loans
1,858 
3,775 
266 
Amortization of intangible assets
3,834 
4,601 
5,367 
Amortization of servicing assets
1,091 
1,648 
3,066 
Mortgage loans originated-for-sale
(23,412)
(19,610)
(67,470)
Proceeds from mortgage loans sold
23,791 
20,585 
73,014 
Net loss (gain) on:
Sale of investment securities
— 
(601)
— 
Sale of SBA loans
(1,415)
(2,015)
— 
Sale of other real estate
(3,089)
(187)
93 
Sale of fixed assets
— 
(46)
(54)
Sale of state tax credits
(1,971)
(904)
(1,506)
Share-based compensation
10,872 
10,146 
8,006 
Net changes in other assets and liabilities
23,349 
8,714 
(19,980)
Net cash provided by operating activities
247,400 
268,238 
216,640 
Cash flows from investing activities:
 
 
Net increase in loans
(398,223)
(1,238,276)
(722,677)
Proceeds received from:
Sale of debt securities, available-for-sale
— 
40,393 
— 
Paydown or maturity of debt securities, available-for-sale
316,874 
233,105 
238,909 
Paydown or maturity of debt securities, held-to-maturity
6,794 
9,135 
11,913 
Redemption of other investments
68,678 
92,879 
12,989 
Sale of SBA loans
25,090 
44,975 
— 
Sale of state tax credits held for sale
10,405 
4,592 
20,645 
Sale of other real estate
11,485 
457 
2,517 
Sale of fixed assets
— 
357 
1,699 
Settlement of bank-owned life insurance policies
1,125 
1,155 
534 
Payments for the purchase of:
Available-for-sale debt securities
(563,600)
(318,797)
(728,247)
Held-to-maturity debt securities
(191,346)
(56,365)
(182,004)
Other investments
(73,871)
(114,746)
(19,286)
State tax credits held for sale
(2,807)
(90)
(18,846)
Fixed assets
(7,475)
(6,556)
(1,930)
Net cash used in investing activities
(796,871)
(1,307,782)
(1,383,784)
68

 
Year ended December 31,
($ in thousands)
2024
2023
2022
Cash flows from financing activities:
 
 
Net increase (decrease) in noninterest-bearing deposit accounts
$
525,329 
$
(683,989)
$
64,296 
Net increase (decrease) in interest-bearing deposit accounts
444,792 
2,031,210 
(578,945)
Net increase (decrease) in short term FHLB advances, net
— 
(100,000)
100,000 
Repayments of long-term FHLB advances
— 
— 
(50,000)
Repayments of notes payable
(11,429)
(5,714)
(5,714)
Net decrease in other borrowings
(5,579)
(20,576)
(24,030)
Cash dividends paid on common stock
(39,550)
(37,368)
(33,602)
Cash dividends paid on preferred stock
(3,750)
(3,750)
(4,041)
Common stock repurchased
(29,641)
— 
(32,923)
Other
440 
1,401 
1,773 
Net cash provided by (used in) financing activities
880,612 
1,181,214 
(563,186)
Net (decrease) increase in cash and cash equivalents
331,141 
141,670 
(1,730,330)
Cash and cash equivalents, beginning of period
433,029 
291,359 
2,021,689 
Cash and cash equivalents, end of period
$
764,170 
$
433,029 
$
291,359 
Supplemental disclosures of cash flow information:
 
 
Cash paid during the period for:
 
 
Interest
$
284,361 
$
195,392 
$
40,736 
Income taxes
28,143 
50,117 
46,009 
Noncash investing and financing transactions:
Transfer to other real estate owned in settlement of loans
$
6,559 
$
6,933 
$
— 
Right-of-use assets obtained in exchange for lease obligations
2,039 
15,640 
9,512 
Transfer of loans from fixed assets for building sale and leaseback
— 
1,460 
— 
Transfer of securities from available for sale to held to maturity
— 
— 
116,927 
Leasehold improvement allowance in other assets
— 
2,483 
— 
Transfer to investment securities in settlement of loans
10,448 
— 
— 
The accompanying notes are an integral part of these Consolidated Financial Statements.
69

ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
 
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies used by the Company in the preparation of the consolidated financial statements are summarized below.
Business and Consolidation
Enterprise is a financial holding company that provides a full range of banking and wealth management services to individuals and corporate
customers primarily located in Arizona, California, Florida, Kansas, Missouri, Nevada, and New Mexico, and SBA loan and deposit productions
offices throughout the country through its banking subsidiary, Enterprise Bank & Trust. All intercompany accounts and transactions have been
eliminated.
The Company and its banking subsidiary are subject to the regulations of various federal and state agencies and undergo periodic examinations
by those regulatory agencies. The Company has one operating segment.
Use of Estimates
The consolidated financial statements of the Company have been prepared in conformity with GAAP. In preparing the consolidated financial
statements, management is required to make estimates and assumptions, which significantly affect the reported amounts in the consolidated
financial statements. Such estimates include the valuation of loans, goodwill, intangible assets, and other long-lived assets, along with
assumptions used in the calculation of income taxes, among others. These estimates and assumptions are based on management’s best estimates
and judgment. Management evaluates its estimates and assumptions on an ongoing basis using experience and other factors, including the
current economic environment, which management believes to be reasonable under the circumstances. Management adjusts such estimates and
assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could
differ significantly from these estimates. Changes in those estimates resulting from continuing changes in the economic environment will be
reflected in the financial statements in future periods.
Cash Flow Information
For purposes of reporting cash flows, the Company considers cash and due from banks, interest-bearing deposits and federal funds sold that
mature within 90 days to be cash and cash equivalents. Cash balances include deposits in transit and drafts in the process of collection. The
Federal Reserve is authorized to establish reserve requirements on depository institutions. In 2020, the Federal Reserve reduced the reserve
requirement to zero percent. As such, cash balances at the Federal Reserve at December 31, 2024 and 2023 were not subject to a reserve
requirement.
Recent Accounting Pronouncements
FASB ASU 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions. ASU 2022-03 was issued in June
2022 to (1) clarify the guidance in Topic 820, Fair Value Measurement, when measuring the fair value of an equity security subject to contractual
restrictions that prohibit the sale of an equity security, (2) amend a related illustrative example, and (3) introduce new disclosure requirements for
equity securities subject to contractual sale restrictions that are measured at fair value in accordance with Topic 820. The amendments in this
update are effective for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. The adoption of ASU
2022-03 did not have a material effect on the consolidated financial statements.
FASB ASU 2023-02, Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method. ASU 2023-02 was
issued in March 2023 to allow reporting entities to consistently account for equity investments made primarily for the purpose of receiving
income tax credits and other income tax benefits. If certain conditions are met, a reporting entity may elect to account for its tax equity
investments by using the proportional amortization method regardless of the program from which it receives income tax credits, instead of only
low-
70

income-housing tax credit (“LIHTC”) structures. This amendment also eliminates certain LIHTC-specific guidance aligning the accounting with
other equity investments in tax credit structures. The amendments in this update are effective for fiscal years beginning after December 15, 2023,
and interim periods within those fiscal years. The adoption of ASU 2023-02 did not have a material effect on the consolidated financial
statements.
FASB ASU 2023-07, Improvements to Reportable Segment Disclosures. ASU 2023-07 was issued in November 2023 to improve reportable
segment disclosure requirements, primarily through enhanced disclosures about significant segment disclosures. The amendments in this update
require annual and interim disclosures on significant segment expenses that are regularly provided to the chief operating decision maker and
require annual and interim disclosures on “other segment items” that comprise the difference between segment revenue less segment expense
compared to the reported measure of segment profit or loss. In addition, the amendments will require all annual disclosures that are currently
required to be reported on an interim basis and requires disclosure of the title and position of the chief operating decision maker and how that
position uses the information to assess segment performance and the allocation of resources. ASU 2023-07 also requires entities that have a
single reportable segment, such as the Company, to provide all disclosures required in this update and the existing segment disclosures in Topic
280. The amendments in this update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years
beginning after December 15, 2024. The adoption of ASU 2023-07 did not have a material effect on the consolidated financial statements.
FASB ASU 2023-09, Income Tax Disclosures. ASU 2023-09 was issued in December 2023 to require annual disclosures on specific categories
in the income tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. Annual
disclosures are required on income taxes paid, including the amounts paid for federal, state and foreign taxes and the amount paid in individual
jurisdictions if the amount is equal to or greater than 5% of total income taxes paid (net of refunds received). Additional annual disclosures are
required on pre-tax income from continuing operations and income tax expense, disaggregated by domestic and foreign amounts. The
amendments in this update are effective for fiscal years beginning after December 15, 2024. The Company is evaluating the accounting and
disclosure requirements of ASU 2023-09 and does not expect them to have a material effect on the consolidated financial statements.
Investments
The Company has classified all investments in debt securities as either available-for-sale or held-to-maturity.
Securities classified as available-for-sale are carried at fair value. Unrealized holding gains and losses for available-for-sale securities are
excluded from earnings and reported as a net amount as a separate component of shareholders’ equity until realized. All previous fair value
adjustments included in the separate component of shareholders’ equity are reversed upon sale.
Securities classified as held-to-maturity are carried at amortized cost and adjusted for amortization of premiums and accretion of discounts.
An ACL on held-to-maturity securities is deducted from the amortized cost basis of the securities to reflect the expected amount to be collected.
When it is determined a security will not be collected, the balance is written-off through the allowance. In evaluating the need for an ACL,
securities with similar risk characteristics are grouped and an estimate of expected cash flows is determined using loss experience, adjusted for
current and reasonable and supportable forecasts of economic conditions.
For available-for-sale securities in a loss position, the Company evaluates whether the decline in fair value below amortized cost resulted from a
credit loss or other factors. Losses attributed to credit are recognized through an ACL on available-for-sale securities, limited to the amount that
the fair value of securities is less than the amortized cost basis. In assessing credit loss, the Company considers, among other things, (1) the
extent to which fair value is less than the amortized cost basis, (2) adverse conditions specific to the security or industry, (3) historical payment
patterns, (4) the likelihood of future payments, and (5) changes to the rating of a security by a rating agency.
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The Company has elected to exclude accrued interest receivable balances from the estimate of the ACL as these amounts are timely written off as
a credit loss expense. Adjustments to the ACL on held-to-maturity and available-for-sale securities are recognized as a component of the
provision for credit losses in the Consolidated Statements of Income.
Premiums and discounts are amortized or accreted over the expected lives of the respective securities as an adjustment to yield using the interest
method. Dividend and interest income is recognized when earned. Realized gains and losses are included in earnings and are derived using the
specific identification method for determining the cost of securities sold.
Loans Held-for-Sale and Servicing Assets
The Company provides long-term financing of 1-4 family residential real estate by originating fixed and variable rate loans. Long-term fixed and
variable rate loans are usually sold into the secondary market with limited recourse. Upon receipt of an application for a real estate loan, the
Company determines whether the loan will be sold into the secondary market or retained in the Company’s loan portfolio. The interest rates on
the loans sold are locked with the buyer and the Company bears no interest rate risk related to these loans. Mortgage loans held-for-sale are
carried at the lower of cost or fair value, which is determined on a specific identification method. The Company does not retain servicing on
these loans.
The Company also originates SBA 7(a) loans that generally provide for a guarantee of 75% of the loan, up to a maximum amount. The
guaranteed portion of the loan can be sold in an active secondary market. For the years ended December 31, 2024 and 2023, all SBA7(a) loans
are considered held-for-investment; however, as the Company makes the determination to sell the loans, they will be moved into the held-for-
sale category. Sales of SBA guaranteed loans are executed on a servicing retained basis, and the Company retains the rights and obligations to
service the loans. At December 31, 2024, the Company was servicing SBA loans that had been sold and has recorded a related servicing asset of
$2.3 million. The servicing asset is accounted for under the amortization method and is evaluated for impairment. Amortization of the servicing
asset is recorded as a reduction to servicing income.
Gains on the sale of held-for-sale loans are reported net of direct origination fees and costs in the Company’s Consolidated Statements of
Income.
Loans
Loans are reported at the principal balance outstanding, net of unearned fees, costs, and premiums or discounts on acquired loans. Loan
origination fees, direct origination costs, and premiums or discounts resulting from acquired loans are deferred and recognized over the lives of
the related loans as a yield adjustment using the interest method.
Interest on loans is accrued to income based on the principal balance outstanding. The recognition of interest income is typically discontinued
when a loan becomes 90 days past due or a significant deterioration in the borrower’s credit has occurred which, in management’s judgment,
negatively impacts the collectibility of the loan. Unpaid interest on such loans is reversed at the time the loan becomes uncollectible and
subsequent interest payments received are generally applied to principal if any doubt exists as to the collectibility of such principal. Loans that
have not been restructured are returned to accrual status when management believes full collectibility of principal and interest is expected. Non-
accrual loans that have been restructured will remain in a non-accrual status until the borrower has made at least six months of consecutive
contractual payments.
The Company has elected to present the accrued interest receivable balance separate from amortized cost basis, to exclude accrued interest
receivable balances from the tabular disclosures, and not to estimate an ACL on accrued interest receivable as these amounts are timely written
off as a credit loss expense.
Accrued interest receivable totaled $52.4 million and $66.7 million at December 31, 2024 and 2023, respectively, and were reported in Other
Assets on the consolidated balance sheets.
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Acquired Loans
Acquired loans are separated into two categories based on the credit risk characteristics of the underlying borrowers as either PCD, for loans
which have experienced more than insignificant credit deterioration since origination, or loans with no credit deterioration (non-PCD). At the
date of acquisition, an ACL on PCD loans is determined and added to the amortized cost basis of the individual loans. The difference between
the initial amortized cost basis and the par value of the loan is a noncredit discount or premium, which is amortized into interest income over the
life of the loan. The ACL on PCD loans is recorded in the acquisition accounting and no provision for credit losses is recognized at the
acquisition date. Subsequent changes to the ACL are recorded through provision expense. For non-PCD loans, an ACL is established
immediately after the acquisition through a charge to the provision for credit losses.
The ACL for both PCD and non-PCD is determined by pooling loans with similar risk characteristics and using the approach described below
under “Allowance for Credit Losses on Loans.”
Non-accrual Loans
Loans are generally placed on non-accrual status when contractually past due 90 days or more as to interest or principal payments. Additionally,
whenever management becomes aware of facts or circumstances that may adversely impact the collectability of principal or interest on loans, it
is management’s practice to place such loans on non-accrual status immediately, rather than delaying such action until the loans become 90 days
past due. Previously accrued and uncollected interest on such loans is reversed. Income is recorded only to the extent a determination has been
made that the principal balance of the loan is collectible and the interest payments are subsequently received in cash, or for a restructured loan,
the borrower has made six consecutive contractual payments. If collectibility of the principal is in doubt, payments received are applied to loan
principal.
Loans past due 90 days or more but still accruing interest are also generally included in nonperforming loans. Loans past due 90 days or more
but still accruing are classified as such where the underlying loans are both well secured (the collateral value covers principal and accrued
interest) and in the process of collection.
Allowance for Credit Losses on Loans
The ACL on loans is a valuation account that is deducted from the amortized cost basis to present the net amount expected to be collected. Loans
are charged-off against the allowance when management deems the loan uncollectible.
Management estimates the allowance using relevant available information, from internal and external sources, relating to past events, current
conditions, and reasonable and supportable forecasts. Credit loss experience provides the basis for the estimation of expected credit losses.
Adjustments to historical loss information are made for differences in current loan-specific risk characteristics such as differences in
underwriting standards, portfolio mix, delinquency level, or term as well as for changes in environmental conditions, such as changes in
unemployment rates, property values, or other relevant factors.
The ACL on loans is measured on a collective basis when similar risk characteristics exist. The Company has identified the following portfolio
segments:
C&I – C&I loans consist of loans to small and medium-sized businesses in a wide variety of industries. These loans are generally collateralized
by inventory, accounts receivable, equipment, real estate and other commercial assets, and may be supported by other credit enhancements such
as personal guarantees. Risk arises primarily due to a difference between expected and actual cash flows of the borrower. However, the
recoverability of these loans is also dependent on other factors primarily dictated by the type of collateral securing these loans. The fair value of
the collateral securing these loans may fluctuate as market conditions change. Included within C&I are revolving loans supported by borrowing
bases that fluctuate depending on the amount of underlying collateral. A portion of C&I loans consists of sponsor finance, which are loans with
senior debt exposure to private equity backed companies.
CRE – CRE loans include various types of loans for which the Company holds real property as collateral. Commercial real estate lending activity
is typically restricted to owner-occupied properties or to investor properties
73

that are owned by customers with a current banking relationship. The primary risks of CRE loans include the borrower’s inability to pay,
material decreases in the value of the real estate being held as collateral and significant increases in interest rates, which may make the real estate
mortgage loan unprofitable. Real estate loans may be more adversely affected by conditions in the real estate markets and in the general
economy.
Construction and Land Development – The Company originates loans to finance construction projects including 1-4 family residences,
multifamily residences, commercial office, and industrial projects. Construction loans are generally collateralized by first liens on the real estate
and have floating interest rates. Construction loans are considered to have higher risks due to construction completion and timing risk, and the
ultimate repayment being sensitive to interest rate changes, governmental regulation of real property and the availability of long-term financing.
Additionally, economic conditions may impact the Company’s ability to recover its investment in construction loans. Adverse economic
conditions may negatively impact the real estate market which could affect the borrowers’ ability to complete and sell the project. Additionally,
the fair value of the underlying collateral may fluctuate as market conditions change.
Residential Real Estate – The Company originates loans to finance one- to four-family residences, secured by both first and second liens.
Repayment of these loans is dependent on the borrowers’ ability to pay and the fair value of the underlying collateral. Residential loans with a
second lien are inherently riskier due to the junior lien position.
Agricultural – Agricultural loans are generally secured with equipment, livestock, crops or other non-real property and at times the underlying
real property. Agricultural loans are primarily included as a component of CRE and C&I loans. As of December 31, 2023, the Company has
ceased originating new agricultural credit relationships.
Consumer – The Company provides a broad range of consumer loans to customers, including personal lines of credit, credit cards, recreational
vehicles, yachts and automobile loans. Repayment of these loans is dependent on the borrowers’ ability to pay and the fair value of the
underlying collateral. Consumer loans are included as a component of Other loans.
The Company utilizes a DCF method to measure the ACL on loans collectively evaluated that are sub-segmented by credit risk levels. The DCF
method incorporates assumptions for probability of default, loss given default, prepayments and curtailments over the contractual term of the
loans. In determining the probability of default, the Company utilized regression analysis to determine certain economic factors that are relevant
loss drivers in the portfolio segments based on historical or peer evaluations. National unemployment is a loss driver used in all portfolios. The
annual percentage change in gross domestic product is used in Construction, Agricultural, and Consumer portfolios. The annual percentage
change in a commercial real estate index, national house price index and national retail sales are used in the CRE, Residential Real Estate and
C&I portfolios, respectively. The contractual term excludes expected extensions, renewals, and modifications unless the extension or renewal
options are included in the original or modified contract at the reporting date and are not unconditionally cancellable by the Company.
The Company uses a one-year reasonable and supportable forecast that considers baseline, upside and downside economic scenarios. For periods
beyond the forecast period, the Company reverts to historical loss rates on a straight-line basis over a one-year period.
Loans that do not share risk characteristics are evaluated on an individual basis. Loans evaluated individually are not also included in the
collective evaluation. When management determines foreclosure is probable, expected credit losses are based on the fair value of the collateral at
the reporting date, adjusted for selling costs. Other individually-evaluated loans may be remeasured using a discounted cash flow method if
appropriate. Non-accrual loans, loans past due greater than 90 days and still accruing, unless adequately secured and in the process of collection,
and restructured loans are evaluated individually.
74

Loan Charge-Offs
Loans are charged-off when the primary and secondary sources of repayment (cash flow, collateral, guarantors, etc.) are less than their carrying
value and the amounts are deemed uncollectible.
Other Real Estate and Repossessed Assets
Other real estate represents property acquired through foreclosure or deeded to the Company in lieu of foreclosure on loans on which the
borrowers have defaulted on the payment of principal or interest. Other real estate is initially recorded at fair value less cost to sell and
subsequently at the lower of cost or fair value less estimated costs to sell. The fair value of other real estate is based upon estimates of future cash
flows, market value of similar assets, if available, or independent appraisals. These estimates involve significant uncertainties and judgments. As
a result, fair value estimates may not be realizable in a current sale or settlement of the other real estate. Gains, losses and writedowns resulting
from the writedown or sale of other real estate are credited or charged to earnings.
Gains and losses resulting from the sale of other real estate are credited or charged to current period earnings. Costs of maintaining and operating
other real estate are expensed as incurred, and expenditures to complete or improve other real estate properties are capitalized if the expenditures
are expected to be recovered upon ultimate sale of the property.
Repossessed assets represent property, other than real estate, that is acquired through repossession and is initially recorded at estimated fair value
on the date of acquisition, less costs to sell. Subsequent to repossession, the assets are carried at the lower of cost or fair value, less estimated
costs to sell.
Fixed Assets
Buildings, leasehold improvements, furniture, fixtures, and equipment are stated at cost less accumulated depreciation. All categories are
computed using the straight-line method over their respective estimated useful lives. Furniture, fixtures and equipment is depreciated over three
to ten years and buildings and leasehold improvements over ten to forty years, based upon estimated lives or lease obligation periods.
State Tax Credits
The Company has purchased the rights to receive 10-year streams of state tax credits at agreed upon discount rates and sells such tax credits to
its clients and others. State tax credits are accounted for at cost. The Company is also a minority partner in a joint venture, accounted for as an
equity method investment, that purchases state income tax credits for resale to customers. Income from both the sale of state tax credits and
earnings from the joint venture are reported as tax credit income in the Consolidated Statements of Income.
Cash Surrender Value of Life Insurance
The Company has purchased bank-owned life insurance policies on certain bank officers. Bank-owned life insurance is recorded at its cash
surrender value. Changes in the cash surrender values, including death benefits in excess of the carrying amount, are included in noninterest
income.
Federal Home Loan Bank Stock
The Bank, as a member of the FHLB, is required to maintain an investment in the capital stock of the FHLB. The stock is redeemable at par by
the FHLB, and is, therefore, carried at cost and periodically evaluated for impairment. The Company records FHLB dividends in interest income.
Goodwill and Other Intangible Assets
The Company tests goodwill for impairment on an annual basis and whenever events or changes in circumstances indicate the Company may not
be able to recover the respective asset’s carrying amount. The Company’s annual test for impairment was performed as of December 31, 2024.
Such tests involve the use of estimates and assumptions.
Potential impairments to goodwill must first be identified by performing a qualitative assessment which evaluates relevant events or
circumstances to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If this test
indicates it is more likely than not that goodwill has been impaired, then
75

a quantitative impairment test is completed. The quantitative impairment test calculates the fair value of the reporting unit and compares it with
its carrying amount, including goodwill. If the carrying amount of goodwill exceeds its implied fair market value, an impairment loss is
recognized. That loss is equal to the carrying amount of goodwill that is in excess of its implied fair market value.
Core deposit intangibles are amortized using an accelerated method over an estimated useful life of approximately 10 years.
Impairment of Long-Lived Assets
Long-lived assets, such as fixed assets and purchased intangibles subject to amortization, are reviewed for impairment whenever events or
changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is
measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset.
If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the
carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are separately presented in the balance sheet and
reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated. The assets and liabilities of a disposal
group classified as held-for-sale are presented separately in the appropriate asset and liability sections of the balance sheet.
Derivative Financial Instruments and Hedging Activities
The Company uses derivative financial instruments to assist in managing interest rate sensitivity and to modify the repricing, maturity and option
characteristics of certain assets and liabilities. In addition, the Company also offers an interest rate hedge program that includes interest rate
swaps to assist its customers in managing their interest rate risk profile. In order to eliminate the interest rate risk associated with offering these
products, the Company enters into derivative contracts with third parties to offset the customer contracts. The Company does not enter into
derivative financial instruments for trading purposes.
Derivative instruments are required to be measured at fair value and recognized as either assets or liabilities in the consolidated financial
statements. Fair value represents the payment the Company would receive or pay if the item were sold or bought in a current transaction. The
accounting for changes in fair value (gains or losses) of a hedged item is dependent on whether the related derivative is designated and qualifies
for “hedge accounting.” The Company assigns derivatives to one of these categories at the purchase date: cash flow hedge, fair value hedge, or
non-designated hedges as part of a customer interest-rate swap product. An assessment of the expected and ongoing hedge effectiveness of any
derivative designated a fair value hedge or cash flow hedge is performed as required by the applicable accounting standards. Derivatives are
included in other assets and other liabilities in the consolidated balance sheets. The fair value amounts recognized for derivative instruments and
the fair value amounts recognized for the right to reclaim or obligation to return cash collateral are not offset when represented under a master
netting arrangement. Generally, the only derivative instruments used by the Company have been interest rate swaps, collars, forward currency
contracts, and interest rate caps.
Certain derivative financial instruments are not designated as cash flow or as fair value hedges for accounting purposes. These non-designated
derivatives are intended to provide interest rate protection on net interest income or noninterest income but do not meet hedge accounting
treatment. Customer accommodation interest rate swap contracts are not designated as hedging instruments. Changes in the fair value of these
instruments are recorded in interest income or noninterest income in the consolidated statements of income depending on the underlying hedged
item.
Income Taxes
The Company and its subsidiaries file a consolidated federal income tax return. Deferred tax assets and liabilities are recognized for the
estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities
and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those
temporary differences are expected to be recovered or settled. The need for deferred tax asset valuation allowances is based on a more-likely-
than-not
76

standard. The ability to realize deferred tax assets depends on the ability to generate sufficient positive taxable income within the carryback or
carryforward periods provided for in the laws for each applicable taxing jurisdiction. The following possible sources of taxable income are
considered: future reversal patterns of existing taxable temporary differences, future taxable income exclusive of reversing temporary
differences, taxable income in prior carryback years and the availability of qualified tax planning strategies. The assessment regarding whether a
valuation allowance is required or should be adjusted depends on all available positive and negative factors including, but not limited to, nature,
frequency, and severity of recent losses, duration of available carryforward periods, experience with tax attributes expiring unused and near and
medium term financial outlook. Because of the complexity of tax laws and regulations, interpretation can be difficult and subject to legal
judgment given specific facts and circumstances. It is possible that others, given the same information, may at any point in time reach different
reasonable conclusions regarding the estimated amounts of accrued taxes.
Share-Based Compensation
Share-based compensation is recognized as an expense for stock options, restricted stock awards, performance stock units, and restricted stock
units granted to employees and directors in return for service. Equity classified awards are measured at the grant date fair value using either an
observable market value or a valuation methodology, and are recognized over the requisite service period on a straight-line basis. Forfeitures are
recorded as they occur. A description of the Company’s share-based employee compensation plan is included in “Note 15 - Shareholders’ Equity
and Compensation Plans.”
Deposit Verticals
The Company offers a deposit vertical platform to customers in certain industries, primarily community associations, property management, and
legal industry and escrow services. These customers will typically receive an earnings credit rate on average collected balances that is used to
offset their cost of maintaining the deposit accounts. Earnings credits, otherwise referred to as Deposit costs, are reflected as a component of
non-interest expense in the Consolidated Statement of Income.
Acquisitions and Divestitures
Acquisitions and business combinations are accounted for using the acquisition method of accounting. The assets and liabilities of the acquired
entities have been recorded at their estimated fair values at the date of acquisition. Goodwill represents the excess of the purchase price over the
fair value of net assets acquired, including the amount assigned to identifiable intangible assets.
The purchase price allocation process requires an estimation of the fair values of the assets acquired and the liabilities assumed. When a business
combination agreement provides for an adjustment to the cost of the combination contingent on future events, the Company includes an estimate
of the acquisition-date fair value as part of the cost of the combination.  To determine the fair values, the Company relies on third party
valuations, such as appraisals, or internal valuations based on discounted cash flow analyses or other valuation techniques.  The results of
operations of the acquired business are included in the Company’s consolidated financial statements from the date of acquisition. Merger-related
expenses include costs directly related to merger or acquisition activity and include legal and professional fees, system consolidation and
conversion costs, and compensation costs such as severance and retention incentives for employees impacted by acquisition activity. The
Company accounts for merger-related expenses in the periods in which the costs are incurred and the services are received.
For divestitures, the Company measures an asset (disposal group) classified as held-for-sale at the lower of its carrying value at the date the asset
is initially classified as held-for-sale or its fair value less costs to sell. The Company reports the results of operations of an entity or group of
components that either has been disposed of or held-for-sale as discontinued operations only if the disposal of that component represents a
strategic shift that has or will have a major effect on an entity’s operations and financial results.
Any incremental direct costs incurred to transact the sale are allocated against the gain or loss on the sale. These costs include items such as legal
fees, title transfer fees, broker fees, etc. Any goodwill and intangible assets
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associated with the portion of the reporting unit to be disposed of is included in the carrying amount of the business in determining the gain or
loss on the sale.
Basic and Diluted Earnings Per Common Share
Basic earnings per common share data is calculated by dividing net income available to common shareholders by the weighted average number
of common shares outstanding during the period. Common shares outstanding include common stock and restricted stock awards where
recipients have satisfied the vesting terms. Diluted earnings per common share gives effect to all potential dilutive common shares outstanding
during the period using the treasury stock method.
Consolidated Statement of Comprehensive Income
The Consolidated Statement of Comprehensive Income includes the amount and the related tax impact that have been reclassified from
accumulated other comprehensive income to net income. The classification adjustment for unrealized loss/gain on sale of securities included in
net income has been recorded through the gain on sale of investment securities line item, within noninterest income, in the Company’s
Consolidated Statements of Income. 
Share Repurchases
The Company periodically adopts share repurchase plans that authorize open market repurchases of common stock. Shares acquired through the
repurchase plan are classified as treasury stock or the shares are immediately retired upon settlement, depending on plan authorization. When
shares are retired, the excess of repurchase price over par is allocated between additional paid in capital and retained earnings. The amount
allocated to additional paid in capital is limited to the pro rata portion of additional paid in capital at the time of repurchase.
Reclassifications
Certain amounts, including deposit costs and other noninterest expense, reported in prior periods in the “Consolidated Statements of Income,”
and “Note 20 – Supplemental Financial Information,” have been reclassified to conform to the current presentation. The reclassifications had no
effect on net income or shareholders’ equity.
NOTE 2 - EARNINGS PER SHARE
Basic earnings per common share data is calculated by dividing net income available to common shareholders by the weighted average number
of common shares outstanding during the period. Diluted earnings per common share gives effect to all dilutive potential common shares
outstanding during the period using the treasury stock method.
The following table presents a summary of per common share data and amounts for the periods indicated.
 
Year ended December 31,
(in thousands, except per share data)
2024
2023
2022
Net income available to common shareholders
$
181,516 
$
190,309 
$
199,002 
Weighted average common shares outstanding
37,357 
37,370 
37,381 
Additional dilutive common stock equivalents
210 
137 
119 
Weighted average diluted common shares outstanding
37,567 
37,507 
37,500 
Basic earnings per common share
$
4.86 
$
5.09 
$
5.32 
Diluted earnings per common share
$
4.83 
$
5.07 
$
5.31 
For 2024, 2023, and 2022, common stock equivalents of approximately 434,000, 419,000 and 224,000, respectively, were excluded from the
earnings per share calculation because their effect would have been anti-dilutive.
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NOTE 3 - INVESTMENTS
The following table presents the amortized cost, gross unrealized gains and losses, allowance for credit losses and fair value of securities
available-for-sale and held-to-maturity: 
 
December 31, 2024
($ in thousands)
Amortized Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Fair Value
Available-for-sale securities:
 
 
 
 
    Obligations of U.S. Government-sponsored enterprises
$
290,329 
$
69 
$
(14,358)
$
276,040 
    Obligations of states and political subdivisions
492,896 
12 
(83,711)
409,197 
    Agency mortgage-backed securities
1,090,495 
1,072 
(64,173)
1,027,394 
    Corporate debt securities
21,198 
— 
(452)
20,746 
    U.S. Treasury Bills
130,565 
34 
(1,706)
128,893 
          Total securities available-for-sale
$
2,025,483 
$
1,187 
$
(164,400)
$
1,862,270 
Held-to-maturity securities:
    Obligations of states and political subdivisions
$
759,059 
$
2,366 
$
(60,351)
$
701,074 
    Agency mortgage-backed securities
47,912 
— 
(5,004)
42,908 
    Corporate debt securities
122,221 
269 
(7,601)
114,889 
          Total securities held-to-maturity
$
929,192 
$
2,635 
$
(72,956)
$
858,871 
Allowance for credit losses
(257)
Total securities held-to-maturity, net
$
928,935 
 
December 31, 2023
($ in thousands)
Amortized Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Fair Value
Available-for-sale securities:
 
 
 
 
    Obligations of U.S. Government-sponsored enterprises
$
316,511 
$
303 
$
(20,368)
$
296,446 
    Obligations of states and political subdivisions
500,881 
57 
(68,767)
432,171 
    Agency mortgage-backed securities
758,283 
1,181 
(59,083)
700,381 
    Corporate debt securities
8,750 
— 
(1,176)
7,574 
    U.S. Treasury Bills
184,709 
62 
(3,070)
181,701 
Total securities available-for-sale
$
1,769,134 
$
1,603 
$
(152,464)
$
1,618,273 
Held-to-maturity securities:
    Obligations of states and political subdivisions
$
575,699 
$
7,078 
$
(47,461)
$
535,316 
    Agency mortgage-backed securities
52,100 
— 
(5,424)
46,676 
    Corporate debt securities
123,420 
216 
(8,981)
114,655 
Total securities held-to-maturity
$
751,219 
$
7,294 
$
(61,866)
$
696,647 
Allowance for credit losses
(785)
Total securities held-to-maturity, net
$
750,434 
The Company believes the held-to-maturity category is consistent with the Company’s intent for these securities. The Company did not transfer
any securities from available-for-sale to held-to-maturity in 2024 or 2023. The balance of held-to-maturity securities in the “Amortized Cost”
column in the table above includes a cumulative net unamortized, unrealized gain of $10.8 million and $14.1 million at December 31, 2024 and
2023, respectively. Such amounts are amortized over the remaining life of the securities.
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At December 31, 2024 and 2023, there were no holdings of securities of any one issuer in an amount greater than 10% of shareholders’ equity,
other than the U.S. Government agencies and sponsored enterprises. The agency mortgage-backed securities are all issued by U.S. Government
agencies and sponsored enterprises. Securities of $1.5 billion and $1.6 billion at December 31, 2024 and December 31, 2023, respectively, were
pledged as collateral to secure deposits of public institutions and for other purposes as required by law or contract provisions, in addition to
collateral securing borrowing bases with the FHLB and the Federal Reserve Bank.
The amortized cost and estimated fair value of debt securities at December  31, 2024, by contractual maturity, are shown below. Expected
maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or
prepayment penalties. The weighted average life of the mortgage-backed securities is approximately five years.
Available-for-sale
Held-to-maturity
($ in thousands)
Amortized Cost
Estimated
Fair Value
Amortized Cost
Estimated
Fair Value
Due in one year or less
$
109,113 
$
108,614 
$
6,408 
$
6,374 
Due after one year through five years
283,377 
271,322 
123,019 
115,700 
Due after five years through ten years
211,912 
183,490 
194,514 
189,364 
Due after ten years
330,586 
271,450 
557,339 
504,525 
Agency mortgage-backed securities
1,090,495 
1,027,394 
47,912 
42,908 
 
$
2,025,483 
$
1,862,270 
$
929,192 
$
858,871 
There were 830 and 753 available-for-sale securities in an unrealized loss position as of December 31, 2024 and 2023, respectively, included in
the following tables:
 
 
December 31, 2024
Less than 12 months
12 months or more
Total
($ in thousands)
Fair Value
Unrealized
Losses
Fair Value
Unrealized
Losses
Fair Value
Unrealized
Losses
Obligations of U.S. Government-sponsored enterprises
$
21,044 
$
132 
$
234,191 
$
14,226 
$
255,235 
$
14,358 
Obligations of states and political subdivisions
3,117 
143 
403,767 
83,568 
406,884 
83,711 
Agency mortgage-backed securities
423,600 
6,763 
478,790 
57,410 
902,390 
64,173 
Corporate debt securities
1,956 
44 
8,342 
408 
10,298 
452 
U.S. Treasury Bills
11,708 
23 
54,177 
1,683 
65,885 
1,706 
 
$
461,425 
$
7,105 
$
1,179,267 
$
157,295 
$
1,640,692 
$
164,400 
 
December 31, 2023
Less than 12 months
12 months or more
Total
($ in thousands)
Fair Value
Unrealized
Losses
Fair Value
Unrealized
Losses
Fair Value
Unrealized
Losses
Obligations of U.S. Government-sponsored enterprises
$
25,886 
$
85 
$
247,027 
$
20,283 
$
272,913 
$
20,368 
Obligations of states and political subdivisions
1,168 
163 
428,171 
68,604 
429,339 
68,767 
Agency mortgage-backed securities
58,249 
417 
540,032 
58,666 
598,281 
59,083 
Corporate debt securities
— 
— 
7,574 
1,176 
7,574 
1,176 
U.S. Treasury Bills
41,857 
49 
103,588 
3,021 
145,445 
3,070 
 
$
127,160 
$
714 
$
1,326,392 
$
151,750 
$
1,453,552 
$
152,464 
80

The unrealized losses at both December 31, 2024 and 2023, were primarily attributable to changes in market interest rates since the securities
were purchased. In 2023, an allowance for credit losses on available-for-sale investment securities was established through a provision for credit
losses of $4.2 million. A debt security of $4.2 million was subsequently charged-off against that allowance. At both December 31, 2024 and
2023, there was no ACL on available-for-sale securities outstanding.
Accrued interest receivable on held-to-maturity debt securities totaled $8.6  million and $6.5  million at December  31, 2024 and 2023,
respectively, and is excluded from the estimate of expected credit losses. The estimate of expected credit losses considers historical credit loss
information adjusted for current conditions and reasonable and supportable forecasts. At December 31, 2024 and 2023, the ACL on held-to-
maturity securities was $0.3 million and $0.8 million, respectively.
The proceeds, gross gains and losses realized from sales of available-for-sale investment securities were as follows:
 
Twelve months ended
($ in thousands)
December 31, 2024
December 31, 2023
December 31, 2022
Gross gains realized
$
— 
$
601 
$
— 
Proceeds from sales
— 
40,393 
— 
Other Investments
At December 31, 2024 and 2023, other investments totaled $72.8 million and $66.2 million, respectively. As a member of the FHLB, the Bank is
required to maintain a minimum investment in capital stock with the FHLB consisting of membership stock and activity-based stock. The FHLB
capital stock of $8.7 million, and $7.8 million at December 31, 2024 and 2023, respectively, is recorded at cost, which represents redemption
value, and is included in other investments in the consolidated balance sheets. The remaining amounts in other investments primarily include
various investments in SBICs, CDFIs, and the Company’s investment in unconsolidated trusts used to issue preferred securities to third parties,
see “Note 10 – Subordinated Debentures and Notes.”
81

NOTE 4 - LOANS
The following table presents a summary of loans by category:
($ in thousands)
December 31, 2024
December 31, 2023
Commercial and industrial
$
4,720,428 
$
4,674,056 
Real estate loans:
Commercial - investor owned
2,607,755 
2,452,402 
Commercial - owner occupied
2,359,956 
2,344,117 
Construction and land development
892,563 
760,122 
Residential
358,923 
371,995 
Total real estate loans
6,219,197 
5,928,636 
Other
281,193 
285,653 
Loans, before unearned loan fees
11,220,818 
10,888,345 
Unearned loan fees, net
(463)
(4,227)
    Loans, including unearned loan fees
$
11,220,355 
$
10,884,118 
The loan balance includes a net premium on acquired loans of $7.8 million and $9.6 million at December 31, 2024 and 2023, respectively. At
December 31, 2024 and 2023, loans of $5.7 billion and $4.8 billion, respectively, were pledged to the FHLB and the Federal Reserve.
The Company had no consumer mortgage loans secured by residential real estate in process of foreclosure as of December 31, 2024. Consumer
mortgage loans secured by residential real estate in process of foreclosure totaled $1.0 million at December 31, 2023.
Loans to executive officers and directors, or to entities in which such individuals had beneficial interests as a shareholder, officer, or director
were immaterial and $0.1 million for the years ended December 31, 2024 and 2023, respectively. Such loans were made in the normal course of
business on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with
other customers and did not involve more than the normal risk of collectibility.
82

A summary of the activity, by loan category, in the allowance for credit losses on loans for 2022, 2023, and 2024 is as follows:
($ in thousands)
Commercial and
industrial
CRE - investor
owned
CRE - owner
occupied
Construction and
land development
Residential real
estate
Other
Total
2022
Allowance for credit losses on loans:
 
 
 
 
 
 
 
Balance, beginning of year
$
63,825 
$
35,877 
$
17,560 
$
14,536 
$
7,927 
$
5,316 
$
145,041 
Provision (benefit) for credit losses
(6,121)
46 
4,867 
(3,145)
540 
(397)
(4,210)
Charge-offs
(6,082)
(478)
(395)
— 
(2,068)
(370)
(9,393)
Recoveries
2,213 
746 
720 
53 
1,529 
233 
5,494 
Balance, end of year
$
53,835 
$
36,191 
$
22,752 
$
11,444 
$
7,928 
$
4,782 
$
136,932 
2023
Allowance for credit losses on loans:
 
 
 
 
 
 
 
Balance, beginning of year
$
53,835 
$
36,191 
$
22,752 
$
11,444 
$
7,928 
$
4,782 
$
136,932 
Provision (benefit) for credit losses
38,308 
(335)
523 
(1,300)
(2,109)
796 
35,883 
Charge-offs
(36,302)
(4,869)
— 
(9)
(656)
(1,379)
(43,215)
Recoveries
3,045 
293 
130 
63 
979 
661 
5,171 
Balance, end of year
$
58,886 
$
31,280 
$
23,405 
$
10,198 
$
6,142 
$
4,860 
$
134,771 
2024
Allowance for credit losses on loans:
 
 
 
 
 
 
 
Balance, beginning of year
$
58,886 
$
31,280 
$
23,405 
$
10,198 
$
6,142 
$
4,860 
$
134,771 
Provision (benefit) for credit losses
14,770 
3,502 
(60)
2,764 
128 
(475)
20,629 
Charge-offs
(13,073)
(700)
(3,074)
(3,224)
(878)
(925)
(21,874)
Recoveries
2,648 
135 
129 
99 
1,142 
271 
4,424 
Balance, end of year
$
63,231 
$
34,217 
$
20,400 
$
9,837 
$
6,534 
$
3,731 
$
137,950 
The Company recorded a provision for credit losses on loans of $20.6 million and $35.9 million for the years ended December 31, 2024 and
2023, respectively. An additional provision for credit losses of $0.9 million and $0.7 million was recorded in 2024 and 2023, respectively, for
securities, unfunded commitments and accrued interest on nonaccrual loans.
The CECL methodology incorporates various economic scenarios. The Company utilizes three forecasts in the model; Moody’s baseline, a
stronger near-term growth upside and a moderate downside forecast. The Company weights these scenarios at 40%, 30%, and 30%, respectively,
which added approximately $14.8  million  to the ACL over the baseline model at December  31, 2024. The forecasts at the end of 2024
incorporate an expectation that the federal funds rate will continue to fall in 2025. The Company has also recognized various risks posed by
loans in certain segments, including the commercial office sector, by allocating additional reserves to those segments. Some of the key risks to
the forecasts that could result in future provision for credit losses are market reactions to the Federal Reserve policy actions that could push the
economy into a recession, persistently higher inflation (including the impact of tariffs), tightening in the credit markets, and further weakness in
the financial system.
In addition to the CECL methodology, the Company incorporates qualitative adjustments into the ACL on loans to capture credit risks inherent
within the loan portfolio that are not captured in the DCF model. Included in these risks are 1) changes in lending policies and procedures, 2)
actual and expected changes in business and economic conditions, 3) changes in the nature and volume of the portfolio, 4) changes in lending
management, 5) changes in volume and the severity of past due loans, 6) changes in the quality of the loan review system, 7) changes in the
value of underlying collateral, 8) the existence and effect of concentrations of credit and 9) other factors such as the regulatory, legal and
competitive environments and events such as natural disasters and pandemics. At December 31, 2024, the ACL on loans included a qualitative
adjustment of $44.3 million. Of this amount, $14.5 million was allocated to Sponsor Finance loans due to their unsecured nature.
83

Gross charge-offs by loan class and year of origination is presented in the following table:
December 31, 2024
Term Loans by Origination Year
($ in thousands)
2024
2023
2022
2021
2020
Prior
Revolving
Loans
Converted to
Term Loans
Revolving
Loans
Total
Commercial and industrial
$
312 
$
2,646 
$
3,043 
$
35 
$
166 
$
772 
$
2,205 
$
3,589 
$
12,768 
Real estate:
Commercial - investor
owned
— 
— 
— 
252 
— 
448 
— 
— 
700 
Commercial - owner
occupied
— 
— 
41 
475 
10 
2,548 
— 
— 
3,074 
Construction and land
development
— 
— 
— 
— 
3,224 
— 
— 
— 
3,224 
Residential
— 
— 
166 
15 
— 
471 
202 
24 
878 
Other
4 
17 
— 
58 
— 
79 
103 
1 
262 
Total charge-offs by
origination year
$
316 
$
2,663 
$
3,250 
$
835 
$
3,400 
$
4,318 
$
2,510 
$
3,614 
$
20,906 
Total gross charge-offs by
performing status
968 
Total gross charge-offs
$
21,874 
December 31, 2023
Term Loans by Origination Year
($ in thousands)
2023
2022
2021
2020
2019
Prior
Revolving
Loans
Converted to
Term Loans
Revolving
Loans
Total
Commercial and industrial
$
600 
$
2,999 
$
1,940 
$
2,539 
$
— 
$
— 
$
12,533 
$
15,178 
$
35,789 
Real estate:
Commercial - investor
owned
— 
— 
170 
— 
4,692 
7 
— 
— 
4,869 
Construction and land
development
— 
— 
— 
— 
— 
9 
— 
— 
9 
Residential
— 
— 
— 
— 
— 
480 
176 
— 
656 
Other
— 
3 
459 
— 
— 
319 
12 
— 
793 
Total charge-offs by
origination year
$
600 
$
3,002 
$
2,569 
$
2,539 
$
4,692 
$
815 
$
12,721 
$
15,178 
$
42,116 
Total gross charge-offs by
performing status
1,099 
Total gross charge-offs
$
43,215 
The following tables present the recorded investment in nonperforming loans by category, excluding government guaranteed balances: 
 
84

December 31, 2024
($ in thousands)
Non-accrual
Loans over 90
days past due and
still accruing
interest
Total nonperforming
loans
Nonaccrual loans
with no allowance
Commercial and industrial
$
15,810 
$
11 
$
15,821 
$
4,279 
Real estate:
    Commercial - investor owned
14,186 
— 
14,186 
2,106 
    Commercial - owner occupied
10,910 
— 
10,910 
8,235 
    Construction and land development
1,503 
— 
1,503 
1,503 
    Residential
258 
— 
258 
— 
Other
— 
9 
9 
— 
       Total
$
42,667 
$
20 
$
42,687 
$
16,123 
December 31, 2023
($ in thousands)
Non-accrual
Loans over 90
days past due and
still accruing
interest
Total
nonperforming
loans
Nonaccrual loans
with no allowance
Commercial and industrial
$
7,641 
$
115 
$
7,756 
$
6,179 
Real estate:
 
    Commercial - investor owned
20,404 
— 
20,404 
19,466 
    Commercial - owner occupied
12,972 
363 
13,335 
9,010 
    Construction and land development
1,205 
64 
1,269 
464 
    Residential
959 
— 
959 
959 
Other
— 
5 
5 
— 
       Total
$
43,181 
$
547 
$
43,728 
$
36,078 
The nonperforming loan balances at December 31, 2024 and December 31, 2023 exclude government guaranteed balances of $22.0 million and
$10.7 million, respectively. Interest income recognized on nonaccrual loans was immaterial in the years ending December 31, 2024, 2023, and
2022.
Collateral-dependent nonperforming loans by class of loan is presented as of the dates indicated:
December 31, 2024
Type of Collateral
($ in thousands)
Commercial Real Estate
Residential Real Estate
Blanket Lien
Other
Commercial and industrial
$
— 
$
— 
$
4,279  $
3,495 
Real estate:
Commercial - investor owned
14,136 
— 
— 
— 
Commercial - owner occupied
7,521 
482 
486 
— 
Total
$
21,657 
$
482 
$
4,765  $
3,495 
85

December 31, 2023
Type of Collateral
($ in thousands)
Commercial Real Estate
Residential Real Estate
Blanket Lien
Other
Commercial and industrial
$
527 
$
1,864 
$
344  $
3,445 
Real estate:
Commercial - investor owned
19,467 
— 
— 
— 
Commercial - owner occupied
5,904 
1,638 
1,831 
— 
Construction and land development
528 
741 
— 
— 
Residential
— 
959 
— 
— 
Total
$
26,426 
$
5,202 
$
2,175  $
3,445 
The aging of the recorded investment in past due loans by class and category is presented as of the dates indicated.
December 31, 2024
($ in thousands)
30-89 Days
 Past Due
90 or More
Days
Past Due
Total
Past Due
Current
Total
Commercial and industrial
$
1,948 
$
12,228 
$
14,176 
$
4,706,252 
$
4,720,428 
Real estate:
Commercial - investor owned
1,377 
14,333 
15,710 
2,592,045 
2,607,755 
Commercial - owner occupied
10,542 
18,591 
29,133 
2,330,823 
2,359,956 
Construction and land development
101 
5,620 
5,721 
886,842 
892,563 
Residential
2,833 
258 
3,091 
355,832 
358,923 
Other
34 
9 
43 
281,150 
281,193 
Loans, before unearned loan fees
$
16,835 
$
51,039 
$
67,874 
$
11,152,944 
11,220,818 
Unearned loan fees, net
(463)
Total
$
11,220,355 
December 31, 2023
($ in thousands)
30-89 Days
 Past Due
90 or More
Days
Past Due
Total
Past Due
Current
Total
Commercial and industrial
$
3,445 
$
9,037 
$
12,482 
$
4,661,574 
$
4,674,056 
Real estate:
 
Commercial - investor owned
1,905 
18,395 
20,300 
2,432,102 
2,452,402 
Commercial - owner occupied
8,409 
14,142 
22,551 
2,321,566 
2,344,117 
Construction and land development
770 
1,908 
2,678 
757,444 
760,122 
Residential
1,620 
959 
2,579 
369,416 
371,995 
Other
82 
4 
86 
285,567 
285,653 
Loans, before unearned loan fees
$
16,231 
$
44,445 
$
60,676 
$
10,827,669 
10,888,345 
Unearned loan fees, net
(4,227)
Total
$
10,884,118 
The allowance for credit losses incorporates an estimate of lifetime expected credit losses and is recorded on each asset upon origination or
acquisition. The starting point for the estimate of the allowance for credit losses is historical loss information, which includes losses from
modifications of receivables to borrowers experiencing financial difficulty. The Company uses a probability of default and loss given default
model to determine the allowance for credit losses.
86

An assessment of whether a borrower is experiencing financial difficulty is made on the date of a modification. The effect of most modifications
made to borrowers experiencing financial difficulty is already included in the allowance for credit losses because of the measurement
methodologies used to estimate the allowance.
The most common concession the Company provides to borrowers experiencing financial difficulty is a term extension. In limited
circumstances, the Company may modify loans by providing principal forgiveness or an interest rate reduction. When principal forgiveness is
provided, the amortized cost basis of the asset is written off against the allowance for credit losses. The amount of the principal forgiveness is
deemed to be uncollectible; therefore, that portion of the loan is written off, resulting in a reduction of the amortized cost basis and a
corresponding adjustment to the allowance for credit losses.
In some cases, the Company will modify a loan by providing multiple types of concessions. Typically, one type of concession, such as a term
extension, is granted initially. If the borrower continues to experience financial difficulty, another concession, such as an interest rate reduction
or principal forgiveness, may be granted.
The following tables show the recorded investment at the end of the dates listed for loans modified to borrowers experiencing financial difficulty,
disaggregated by loan class and type of concession granted:
Term Extension
Payment Delay
Total
Twelve months ended
Twelve months ended
Twelve months ended
($ in thousands)
December 31,
2024
Percent of Total
Loan Class
December 31,
2024
Percent of Total
Loan Class
December 31,
2024
Percent of Total
Loan Class
Commercial and industrial
$
43,094 
0.91 % $
567 
0.01 % $
43,661 
0.92 %
Real estate:
Commercial - investor owned
256 
0.01 %
— 
— %
256 
0.01 %
Commercial - owner occupied
12,890 
0.54 %
— 
— %
12,890 
0.54 %
Residential
69 
0.02 %
— 
— %
69 
0.02 %
Total
$
56,309 
0.50 % $
567 
0.01 % $
56,876 
0.51 %
Term Extension
Twelve months ended
($ in thousands)
December 31, 2023
Percent of Total Loan
Class
Commercial and industrial
$
39,437 
0.84 %
Real estate:
Commercial - investor owned
9,411 
0.38 %
Commercial - owner occupied
94 
— %
Construction and land development
1,137 
0.15 %
Residential
7,601 
2.04 %
Other
4 
— %
Total
$
57,684 
The Company had $3.3 million in commitments to lend additional funds to borrowers experiencing financial difficulty included in the previous
table at December 31, 2024. There were $6.6 million and $0.7 million of loans modified to borrowers experiencing financial difficulty that were
also included in nonperforming loans, excluding government guaranteed balances, as of December  31, 2024 and December  31, 2023,
respectively.
87

The following tables summarize the financial impacts of loan modifications made to borrowers experiencing financial difficulty and outstanding
at the date indicated:
Weighted Average Term Extension (in
months)
Amount of Payment Delay
Twelve months ended
Twelve months ended
($ in thousands)
December 31, 2024
December 31, 2024
Commercial and industrial
6 $
85 
Real estate:
Commercial - investor owned
12
— 
Commercial - owner occupied
22
— 
Residential
24
— 
Weighted Average Term Extension (in
months)
Twelve months ended
December 31, 2023
Commercial and industrial
5
Real estate:
Commercial - investor owned
4
Commercial - owner occupied
3
Construction and land development
7
Residential
3
Other
48
The following tables show the aging of the recorded investment in modified loans in the last 12 months by class at the date indicated:
December 31, 2024
($ in thousands)
Current
30-89 Days
 Past Due
90 or More
Days
Past Due
Total
Commercial and industrial
$
42,243 
$
567 
$
851 
$
43,661 
Real estate:
Commercial - investor owned
256 
— 
— 
256 
Commercial - owner occupied
11,972 
— 
918 
12,890 
Residential
69 
— 
— 
69 
Total
$
54,540 
$
567 
$
1,769 
$
56,876 
88

December 31, 2023
($ in thousands)
Current
30-89 Days
 Past Due
90 or More
Days
Past Due
Total
Commercial and industrial
$
39,187 
$
250 
$
— 
$
39,437 
Real estate:
Commercial - investor owned
9,411 
— 
— 
9,411 
Commercial - owner occupied
— 
94 
— 
94 
Construction and land development
1,137 
— 
— 
1,137 
Residential
7,527 
74 
— 
7,601 
Other
— 
4 
— 
4 
Total
$
57,262 
$
422 
$
— 
$
57,684 
The following table summarizes loans that experienced a default during the twelve months ended December 31, 2024, subsequent to being
granted a modification in the preceding twelve months. All of these loans were charged-off during the preceding period. Default is defined as
movement to nonperforming status, foreclosure or charge-off.
Term Extension
Twelve months ended
($ in thousands)
December 31,
2024
Percent of Total Loan
Class
Commercial and industrial
$
1,000 
0.02 %
Other
4 
NM
Total
$
1,004 
There were no loans that experienced a default during the twelve months ended December 31, 2023 subsequent to being granted a modification
in the preceding twelve months. As of December 31, 2024 and December 31, 2023, the Company allocated an immaterial amount in specific
reserves to loans that have been restructured.
The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt, such as
current financial information, payment experience, credit documentation, and current economic factors among other factors. This analysis is
performed on a quarterly basis. The Company uses the following definitions for risk ratings:
•
Grades 1, 2, and 3 – Includes loans to borrowers with a continuous record of strong earnings, sound balance sheet condition and
capitalization, ample liquidity with solid cash flow, and whose management team has experience and depth within their industry.
•
Grade 4 – Includes loans to borrowers with positive trends in profitability, satisfactory capitalization and balance sheet condition, and
sufficient liquidity and cash flow.
•
Grade 5 – Includes loans to borrowers that may display fluctuating trends in sales, profitability, capitalization, liquidity, and cash flow.
•
Grade 6 – Includes loans to borrowers where an adverse change or perceived weakness has occurred, but may be correctable in the near
future. Alternatively, this rating category may also include circumstances where the borrower is starting to reverse a negative trend or
condition, or has recently been upgraded from a 7, 8, or 9 rating.
•
Grade 7 – Special Mention credits are borrowers that have experienced financial setback of a nature that is not determined to be severe
or influence ‘ongoing concern’ expectations. Although possible, no loss is anticipated, due to strong collateral and/or guarantor support.
89

•
Grade 8 – Substandard credits include those borrowers characterized by significant losses and sustained downward trends in balance
sheet condition, liquidity, and cash flow. Repayment reliance may have shifted to secondary sources. Collateral exposure may exist and
additional reserves may be warranted.
•
Grade 9 – Doubtful credits include borrowers that may show deteriorating trends that are unlikely to be corrected. Collateral values may
appear insufficient for full recovery, therefore requiring a partial charge-off, or debt renegotiation with the borrower. The borrower may
have declared bankruptcy or bankruptcy is likely in the near term. All doubtful rated credits will be on non-accrual.
90

The recorded investment by risk category of the loans by class and year of origination is presented in the following tables as of the dates
indicated:
December 31, 2024
Term Loans by Origination Year
($ in thousands)
2024
2023
2022
2021
2020
Prior
Revolving
Loans
Converted to
Term Loans
Revolving
Loans
Total
Commercial and
industrial
Pass (1-6)
$ 1,477,552 
$
958,327 
$
607,626 
$
172,201 
$
117,845 
$
69,236 
$
87,059 
$
942,991 
$
4,432,837 
Special Mention (7)
32,479 
40,804 
4,982 
2,373 
796 
64 
14,783 
55,100 
151,381 
Classified (8-9)
29,999 
868 
9,271 
— 
142 
809 
9,681 
20,791 
71,561 
Total Commercial and
industrial
$ 1,540,030 
$
999,999 
$
621,879 
$
174,574 
$
118,783 
$
70,109 
$
111,523 
$ 1,018,882 
$
4,655,779 
Commercial real estate-
investor owned
Pass (1-6)
$
587,403 
$
402,899 
$
479,131 
$
374,155 
$
266,044 
$
281,232 
$
4,566 
$
48,808 
$
2,444,238 
Special Mention (7)
12,195 
4,901 
— 
43,506 
2,389 
9,623 
31,321 
1,999 
105,934 
Classified (8-9)
256 
— 
821 
20,274 
13,564 
4,702 
— 
— 
39,617 
Total Commercial real
estate-investor owned
$
599,854 
$
407,800 
$
479,952 
$
437,935 
$
281,997 
$
295,557 
$
35,887 
$
50,807 
$
2,589,789 
Commercial real estate-
owner occupied
Pass (1-6)
$
420,774 
$
329,001 
$
437,731 
$
408,210 
$
246,024 
$
352,095 
$
890 
$
29,239 
$
2,223,964 
Special Mention (7)
6,914 
10,764 
5,323 
12,324 
8,426 
18,389 
— 
— 
62,140 
Classified (8-9)
13,794 
3,727 
4,063 
6,452 
3,765 
22,319 
— 
250 
54,370 
Total Commercial real
estate-owner occupied
$
441,482 
$
343,492 
$
447,117 
$
426,986 
$
258,215 
$
392,803 
$
890 
$
29,489 
$
2,340,474 
Construction real estate
Pass (1-6)
$
404,286 
$
211,573 
$
198,278 
$
38,131 
$
6,110 
$
3,823 
$
9,513 
$
5,338 
$
877,052 
Special Mention (7)
11,250 
33 
49 
294 
— 
223 
— 
— 
11,849 
Classified (8-9)
— 
— 
1,573 
— 
— 
585 
— 
— 
2,158 
Total Construction real
estate
$
415,536 
$
211,606 
$
199,900 
$
38,425 
$
6,110 
$
4,631 
$
9,513 
$
5,338 
$
891,059 
Residential real estate
Pass (1-6)
$
46,454 
$
37,371 
$
35,082 
$
27,784 
$
22,350 
$
78,113 
$
5,880 
$
79,284 
$
332,318 
Special Mention (7)
1,539 
26 
239 
— 
— 
1,435 
— 
887 
4,126 
Classified (8-9)
— 
2,979 
107 
11,976 
5,538 
1,572 
— 
— 
22,172 
Total residential real
estate
$
47,993 
$
40,376 
$
35,428 
$
39,760 
$
27,888 
$
81,120 
$
5,880 
$
80,171 
$
358,616 
Other
Pass (1-6)
$
31,286 
$
6,058 
$
50,351 
$
55,844 
$
49,519 
$
31,061 
$
44 
$
40,578 
$
264,741 
Special Mention (7)
— 
2,326 
— 
— 
— 
1,780 
— 
7,660 
11,766 
Classified (8-9)
— 
— 
— 
— 
— 
5 
— 
— 
5 
Total Other
$
31,286 
$
8,384 
$
50,351 
$
55,844 
$
49,519 
$
32,846 
$
44 
$
48,238 
$
276,512 
Total loans classified by
risk category
$ 3,076,181 
$ 2,011,657 
$ 1,834,627 
$ 1,173,524 
$
742,512 
$
877,066 
$
163,737 
$ 1,232,925 
$
11,112,229 
Total loans classified by
performing status
108,126 
Total loans
$
11,220,355 
91

December 31, 2023
Term Loans by Origination Year
($ in thousands)
2023
2022
2021
2020
2019
Prior
Revolving
Loans
Converted to
Term Loans
Revolving
Loans
Total
Commercial and industrial
Pass (1-6)
$
1,567,738 
$
1,052,462 
$
345,292 
$
194,972 
$
123,425 
$
71,205 
$
12,163 
$
1,108,233 
$
4,475,490 
Special Mention (7)
52,523 
6,845 
8,597 
544 
453 
242 
272 
19,590 
89,066 
Classified (8-9)
12,824 
19,306 
1,833 
812 
339 
363 
508 
45,830 
81,815 
Total Commercial and
industrial
$
1,633,085 
$
1,078,613 
$
355,722 
$
196,328 
$
124,217 
$
71,810 
$
12,943 
$
1,173,653 
$
4,646,371 
Commercial real estate-
investor owned
Pass (1-6)
$
495,131 
$
544,223 
$
492,974 
$
323,175 
$
165,343 
$
236,914 
$
5,222 
$
51,413 
$
2,314,395 
Special Mention (7)
3,626 
22,725 
51,851 
1,657 
164 
5,526 
— 
— 
85,549 
Classified (8-9)
9,411 
1,034 
43 
15,838 
2,831 
4,919 
48 
— 
34,124 
Total Commercial real
estate-investor owned
$
508,168 
$
567,982 
$
544,868 
$
340,670 
$
168,338 
$
247,359 
$
5,270 
$
51,413 
$
2,434,068 
Commercial real estate-
owner occupied
Pass (1-6)
$
407,901 
$
486,701 
$
489,589 
$
301,399 
$
183,872 
$
313,474 
$
5,083 
$
30,036 
$
2,218,055 
Special Mention (7)
13,739 
2,521 
4,652 
10,492 
5,439 
15,833 
— 
1,493 
54,169 
Classified (8-9)
3,389 
3,413 
2,247 
3,181 
8,878 
24,857 
5,056 
— 
51,021 
Total Commercial real
estate-owner occupied
$
425,029 
$
492,635 
$
496,488 
$
315,072 
$
198,189 
$
354,164 
$
10,139 
$
31,529 
$
2,323,245 
Construction real estate
Pass (1-6)
$
292,689 
$
325,010 
$
96,426 
$
30,956 
$
1,413 
$
3,408 
$
10 
$
3,700 
$
753,612 
Special Mention (7)
42 
2,958 
1,046 
210 
123 
114 
— 
— 
4,493 
Classified (8-9)
1,137 
704 
— 
— 
13 
466 
— 
— 
2,320 
Total Construction real
estate
$
293,868 
$
328,672 
$
97,472 
$
31,166 
$
1,549 
$
3,988 
$
10 
$
3,700 
$
760,425 
Residential real estate
Pass (1-6)
$
59,259 
$
41,956 
$
51,436 
$
30,713 
$
17,793 
$
77,327 
$
1,464 
$
78,351 
$
358,299 
Special Mention (7)
322 
— 
— 
— 
75 
1,801 
— 
614 
2,812 
Classified (8-9)
127 
1,073 
69 
— 
30 
1,492 
74 
7,500 
10,365 
Total residential real estate
$
59,708 
$
43,029 
$
51,505 
$
30,713 
$
17,898 
$
80,620 
$
1,538 
$
86,465 
$
371,476 
Other
Pass (1-6)
$
10,071 
$
55,923 
$
67,766 
$
53,569 
$
9,382 
$
19,657 
$
7 
$
28,464 
$
244,839 
Special Mention (7)
— 
— 
14,472 
— 
— 
— 
— 
11,645 
26,117 
Classified (8-9)
— 
— 
— 
— 
— 
8 
— 
— 
8 
Total Other
$
10,071 
$
55,923 
$
82,238 
$
53,569 
$
9,382 
$
19,665 
$
7 
$
40,109 
$
270,964 
Total loans classified by
risk category
$
2,929,929 
$
2,566,854 
$
1,628,293 
$
967,518 
$
519,573 
$
777,606 
$
29,907 
$
1,386,869 
$
10,806,549 
Total loans classified by
performing status
77,569 
Total loans
$
10,884,118 
92

In the tables above, loan originations in 2024 and 2023 with a classification of “special mention” or “classified” primarily represent renewals or
modifications initially underwritten and originated in prior years. For certain loans the Company evaluates credit quality based on the aging
status. The following tables present the recorded investment in loans based on payment activity as of the dates indicated:
December 31, 2024
($ in thousands)
Performing
Non Performing
Total
Commercial and industrial
$
60,899 
$
11 
$
60,910 
Real estate:
Commercial - investor owned
17,175 
— 
17,175 
Commercial - owner occupied
27,349 
— 
27,349 
Residential
647 
— 
647 
Other
2,036 
9 
2,045 
Total
$
108,106 
$
20 
$
108,126 
December 31, 2023
($ in thousands)
Performing
Non Performing
Total
Commercial and industrial
$
26,076 
$
112 
$
26,188 
Real estate:
Commercial - investor owned
17,885 
— 
17,885 
Commercial - owner occupied
28,373 
— 
28,373 
Residential
712 
— 
712 
Other
4,406 
5 
4,411 
Total
$
77,452 
$
117 
$
77,569 
93

NOTE 5 - LEASES
Lessee Arrangements
The Company has banking and limited-service facilities, data centers, and certain equipment under lease agreements. Most of the leases expire
between 2025 and 2029 and include one or more renewal options for up to 5 years. Six leases expire between 2030 and 2034. All leases are
classified as operating leases.
For the year ended December 31,
($ in thousands)
2024
2023
Operating lease cost
$
5,757  $
5,628 
Short-term lease cost
402 
491 
Total lease cost
$
6,159  $
6,119 
Payments on operating leases included in the measurement of lease liabilities during the twelve months ended December 31, 2024 and 2023
totaled $5.6  million and $5.5  million, respectively. Right-of-use assets obtained in exchange for lease obligations totaled $2.0  million and
$15.6 million during the twelve months ended December 31, 2024 and 2023, respectively. The additions in 2024 and 2023 were primarily from
lease renewals.
Supplemental balance sheet information related to leases is as follows:
($ in thousands)
December 31, 2024
December 31, 2023
Operating lease right-of-use assets, included in other assets
$
22,759 
$
25,406 
Operating lease liabilities, included in other liabilities
26,150 
28,635 
Operating leases
Weighted average remaining lease term
6 years
7 years
Weighted average discount rate
4.0 %
3.9 %
Maturities of operating lease liabilities are as follows:
($ in thousands)
Year
Amount
2025
$
6,158 
2026
6,104 
2027
4,850 
2028
3,420 
2029
2,267 
Thereafter
7,061 
Total operating lease liabilities, payments
29,860 
Less: present value adjustment
3,710 
Operating lease liabilities
$
26,150 
Lessor Arrangements
The Company leases office space to a third party through an operating lease. This lease has remaining lease terms of 18 months. Lessor income
was $1.9 million and $1.8 million for the twelve months ended December 31, 2024, and 2023, respectively.
94

NOTE 6 - DERIVATIVE FINANCIAL INSTRUMENTS
Risk Management Objective of Using Derivatives
The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages
its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages
economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and
liabilities and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage
exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which
are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and
duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s loans
and borrowings. The Company does not enter into derivative financial instruments for trading purposes.
Cash Flow Hedges of Interest Rate Risk
The Company’s objectives in using interest rate derivatives are to add stability to interest income and expense and to manage its exposure to
interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management
strategy.
For hedges of the Company’s variable-rate loans, interest rate swaps designated as cash flow hedges involve the receipt of fixed amounts and the
Company making variable rate payments. The Company has executed cash flow hedges to reduce a portion of variability in cash flows on the
Company’s prime based loan portfolio. Select terms of the hedges are as follows:
($ in thousands)
Notional
Fixed Rate
Effective Date
Maturity Date
$
50,000 
6.56 %
January 25, 2023
February 1, 2027
$
100,000 
6.63 %
December 20, 2022
January 1, 2028
$
100,000 
6.66 %
April 1, 2025
April 1, 2030
The Company executed a prime based interest rate collar in the fourth quarter of 2022 with a notional amount of $100.0 million. The collar
includes a cap of 8.14% and a floor of 5.25%. The collar matures on October 1, 2029. The Company also executed a 1-month SOFR based
interest rate collar in the fourth quarter of 2024 with a notional amount of $50.0 million. The collar includes a cap of 4.21% and a floor of
3.23%. The collar matures on November 1, 2029. These transactions are commonly referred to as zero cost collars, which involves the Company
selling an interest rate cap where payments will be made when the index exceeds the cap rate, and the purchase of a floor where payments will
be received if the index falls below the floor.
For hedges of the variable-rate liabilities, interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a
counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying
notional amount. The Company has executed a series of cash flow hedges to fix the effective interest rate for payments due on $32.1 million of
junior subordinated debentures to a weighted-average-fixed rate of 2.64%.
Select terms of the hedges are as follows:
($ in thousands)
Notional
Fixed Rate
Maturity Date
$18,558
2.64%
March 15, 2026
$13,506
2.64%
March 17, 2026
95

The gain or loss on derivatives designated and qualified as cash flow hedges of interest rate risk are recorded in accumulated other
comprehensive income and subsequently reclassified into interest income or expense in the same period(s) during which the hedged transaction
affects earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest income or
expense as interest payments are paid on the Company’s variable-rate loans and debt. During the next twelve months, the Company estimates
$0.6 million will be reclassified as a decrease to interest expense and $1.2 million will be reclassified as a decrease to interest income.
Non-designated Hedges
Derivatives not designated as hedges are not considered speculative and result from a service the Company provides to certain customers. The
Company executes interest rate swaps with commercial banking customers to facilitate their respective risk management strategies. Those
interest rate swaps are simultaneously hedged by offsetting derivatives the Company executes with a third party, such that the Company
minimizes its net risk exposure resulting from such transactions. As the interest rate derivatives associated with this program do not meet the
strict hedge accounting requirements, changes in the fair value of both the customer derivatives and the offsetting derivatives are recognized
directly in earnings as a component of other noninterest income.
The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Balance Sheet as
of December 31st of the year presented.
Notional Amount
Derivative Assets
Derivative Liabilities
($ in thousands)
2024
2023
2024
2023
2024
2023
Derivatives designated as hedging instruments
Interest rate swaps
$
282,064 
$
211,962 
$
649 
$
1,389 
$
3,139 
$
233 
Interest rate collars
150,000 
100,000 
— 
514 
1,056 
— 
Total
$
432,064 
$
311,962 
$
649 
$
1,903 
$
4,195 
$
233 
Derivatives not designated as hedging instruments
Interest rate swaps
$
854,171 
$
779,152 
$
14,495 
$
15,886 
$
14,497 
$
15,951 
Derivative assets are classified on the Balance Sheet in other assets. Derivative liabilities are classified on the Balance Sheet in other liabilities.
The tables below present a gross presentation, the effects of offsetting, and a net presentation of the Company’s financial instruments subject to
offsetting. The gross amounts of assets or liabilities can be reconciled to the tabular disclosure of fair value. The fair value table above provides
the location that financial assets and liabilities are presented on the Balance Sheet.
96

As of December 31, 2024
Gross Amounts Not Offset in the
Statement of Financial Position
($ in thousands)
Gross Amounts
Recognized
Gross Amounts
Offset in the
Statement of
Financial Position
Net Amounts of
Assets presented in
the Statement of
Financial Position
Financial
Instruments
Fair Value
Collateral Posted
Net Amount
Assets:
Interest rate swaps
$
15,144 
$
— 
$
15,144 
$
4,975 
$
9,710 
$
459 
Liabilities:
Interest rate swaps
$
17,636 
$
— 
$
17,636 
$
4,975 
$
— 
$
12,661 
Interest rate collars
1,056 
— 
1,056 
— 
— 
1,056 
Securities sold under agreements to
repurchase
244,618 
— 
244,618 
— 
244,618 
— 
As of December 31, 2023
Gross Amounts Not Offset in the
Statement of Financial Position
($ in thousands)
Gross Amounts
Recognized
Gross Amounts
Offset in the
Statement of
Financial Position
Net Amounts of
Assets presented in
the Statement of
Financial Position
Financial
Instruments
Fair Value
Collateral Posted
Net Amount
Assets:
Interest rate swaps
$
17,275 
$
— 
$
17,275 
$
1,105 
$
16,170 
$
— 
Interest rate collar
514 
— 
514 
— 
— 
514 
Liabilities:
Interest rate swaps
$
16,184 
$
— 
$
16,184 
$
1,105 
$
— 
$
15,079 
Securities sold under agreements to
repurchase
250,197 
— 
250,197 
— 
250,197 
— 
As of December 31, 2024, the fair value of counterparty derivatives in a net liability position, which includes accrued interest, related to these
agreements was $14.0  million. The company has minimum collateral posting thresholds with certain derivative counterparties and posts
collateral related to derivatives in a net liability position. The Company has received cash collateral from counterparties on derivatives that were
in a net asset position as noted in the tables above.
NOTE 7 - FIXED ASSETS
A summary of fixed assets is as follows:
December 31,
($ in thousands)
2024
2023
Land
$
11,716 
$
11,716 
Buildings and leasehold improvements
54,552 
50,720 
Furniture, fixtures and equipment
23,634 
21,526 
89,902 
83,962 
Less accumulated depreciation and amortization
44,893 
41,281 
    Total fixed assets
$
45,009 
$
42,681 
97

Depreciation and amortization of fixed assets included in noninterest expense amounted to $5.1 million, $5.1 million, $5.6 million in 2024, 2023,
and 2022, respectively.
In 2023, the Company completed an asset sale-leaseback on a branch location in the Kansas City market and recorded a gain of $0.1 million.
NOTE 8 - GOODWILL AND INTANGIBLE ASSETS
The Company’s goodwill was $365.2 million for the years ending December 31, 2024 and 2023, respectively.
The table below presents a summary of intangible assets:
($ in thousands)
Years ended December 31,
2024
2023
Core deposit intangible, net, beginning of year
$
12,318 
$
16,919 
Amortization
(3,834)
(4,601)
Core deposit intangible, net, end of year
$
8,484 
$
12,318 
Amortization expense on the core deposit intangibles was $3.8 million, $4.6 million, and $5.4 million for the years ended December 31, 2024,
2023, and 2022, respectively. The core deposit intangibles are being amortized over a 10-year period.
The following table reflects the amortization schedule for the core deposit intangible at December 31, 2024.
Year
Core Deposit Intangible ($ in
thousands)
2025
$
3,068 
2026
2,301 
2027
1,535 
2028
953 
2029
396 
After 2029
231 
 
$
8,484 
NOTE 9 - DEPOSITS
Following is a summary of certificates of deposit maturities at December 31, 2024:
($ in thousands)
Brokered
Customer
Total
Less than 1 year
$
379,370 
$
843,232 
$
1,222,602 
Greater than 1 year and less than 2 years
105,218 
30,478 
135,696 
Greater than 2 years and less than 3 years
— 
3,587 
3,587 
Greater than 3 years and less than 4 years
— 
2,445 
2,445 
Greater than 4 years and less than 5 years
— 
1,225 
1,225 
Greater than 5 years
— 
4,049 
4,049 
$
484,588 
$
885,016 
$
1,369,604 
Certificates of deposit balances over the FDIC insurance limit of $250,000 were $268.2 million and $234.6 million as of December 31, 2024 and
2023, respectively.
98

At December 31, 2024 and 2023, deposit accounts of executive officers and directors, or to entities in which such individuals had beneficial
interests as a shareholder, officer, or director totaled $0.9 million and $2.6 million, respectively.
The Company is a participant in certain networks that offer deposit placement services on a reciprocal basis that qualify large deposits for FDIC
insurance. The Company had $96.6 million and $91.7 million of certificates of deposits, and $1.2 billion and $1.1 billion of demand deposits in
these reciprocal accounts at December 31, 2024 and 2023, respectively.
At December 31, 2024 and 2023, overdraft deposits of $17.2 million and $1.6 million, respectively, were reclassified to loans.
99

NOTE 10 - SUBORDINATED DEBENTURES AND NOTES
The following table summarizes the Company’s subordinated debentures at December 31:
Amount
Maturity Date
Initial Call Date 
Interest Rate
($ in thousands)
2024
2023
EFSC Clayco Statutory Trust I
$
3,196 
$
3,196 
December 17, 2033
December 17, 2008
Floats @ 3 month term SOFR + 3.11%
EFSC Capital Trust II
5,155 
5,155 
June 17, 2034
June 17, 2009
Floats @ 3 month term SOFR + 2.91%
EFSC Statutory Trust III
11,341 
11,341 
December 15, 2034
December 15, 2009
Floats @ 3 month term SOFR + 2.23%
EFSC Clayco Statutory Trust II
4,124 
4,124 
September 15, 2035
September 15, 2010
Floats @ 3 month term SOFR + 2.09%
EFSC Statutory Trust IV
10,310 
10,310 
December 15, 2035
December 15, 2010
Floats @ 3 month term SOFR + 1.70%
EFSC Statutory Trust V
4,124 
4,124 
September 15, 2036
September 15, 2011
Floats @ 3 month term SOFR + 1.86%
EFSC Capital Trust VI
14,433 
14,433 
March 30, 2037
March 30, 2012
Floats @ 3 month term SOFR + 1.86%
EFSC Capital Trust VII
4,124 
4,124 
December 15, 2037
December 15, 2012
Floats @ 3 month term SOFR + 2.51%
JEFFCO Stat Trust I
7,732 
7,732 
February 22, 2031
February 22, 2011
Fixed @ 10.20%
JEFFCO Stat Trust II 
4,658 
4,604 
March 17, 2034
March 17, 2009
Floats @ 3 month term SOFR + 3.01%
Trinity Capital Trust III 
5,539 
5,473 
September 8, 2034
September 8, 2009
Floats @ 3 month term SOFR + 2.96%
Trinity Capital Trust IV
10,310 
10,310 
November 23, 2035
August 23, 2010
Fixed @ 6.88%
Trinity Capital Trust V
8,358 
8,195 
December 15, 2036
September 15, 2011
Floats @ 3 month term SOFR + 1.91%
Total junior subordinated debentures
93,404 
93,121 
5.75% Fixed-to-floating rate subordinated
notes
63,250 
63,250 
June 1, 2030
June 1, 2025
Fixed @ 5.75% until
June 1, 2025, then floats @ Benchmark
rate (3 month term SOFR) + 5.66%
Debt issuance costs
(103)
(387)
Total fixed-to-floating rate subordinated
notes
63,147 
62,863 
Total subordinated debentures and notes
$
156,551 
$
155,984 
(1) Callable each quarter after initial call date.
(2) Purchase accounting adjustments are reflected in the balance and also impact the effective interest rate.
The Company has 13 unconsolidated statutory business trusts. These trusts issued preferred securities that were sold to third parties. The sole
purpose of the trusts was to invest the proceeds in junior subordinated debentures of the Company that have terms identical to the trust preferred
securities. The subordinated debentures, which are the sole assets of the trusts, are subordinate and junior in right of payment to all present and
future senior and subordinated indebtedness and certain other financial conditions of the Company. The Company fully and unconditionally
guarantees each trust’s securities obligations. Under current regulations, the trust preferred securities are included in tier 1 capital for regulatory
capital purposes, subject to certain limitations.
The trust preferred securities are redeemable in whole or in part on or after their respective call dates. Mandatory redemption dates may be
shortened if certain conditions are met. The securities are classified as subordinated debentures in the Company’s consolidated balance sheets.
Interest on the subordinated debentures held by the trusts is recorded as interest expense in the Company’s Consolidated Statements of Income.
The Company’s investment in these trusts of $2.9 million at December 31, 2024 and 2023 is included in other investments in the consolidated
balance sheets. The Company has fixed the interest rate on a portion of its junior subordinated debentures through a
(1)
(2)
(2)
 (2)
100

series of interest rate swaps. For further discussion of the interest rate swaps and the corresponding terms, see “Note 6 – Derivative Financial
Instruments.”
On May 21, 2020, EFSC issued $63.3 million of 5.75% fixed-to-floating rate subordinated notes due in 2030 in a public offering (the “2030
Notes”). From and including the date of issuance to, but excluding, June 1, 2025, the 2030 Notes will bear interest at a rate equal to 5.75% per
annum, payable semiannually in arrears on each June 1 and December 1. From and including June 1, 2025 to, but excluding, the maturity date or
the date of earlier redemption, the 2030 Notes will bear interest at a floating rate per annum equal to a benchmark rate (which is expected to be
three-month term SOFR (as defined in the Indenture, dated May 21, 2020, between EFSC and U.S. Bank National Association, as trustee, and
subsequent First Supplemental Indenture)), plus 566.0 basis points, payable quarterly in arrears on March 1, June 1, September 1 and December
1 of each year, commencing on September 1, 2025. Notwithstanding the foregoing, in event that the benchmark rate is less than zero, then the
benchmark rate shall be deemed to be zero. The Company’s obligation to make payments of principal and interest on the notes is subordinate and
junior in right of payment to all of its senior debt. Current regulatory guidance allows for this subordinated debt to be treated as tier 2 regulatory
capital for the first five years of its term, subject to certain limitations, and then phased out of tier 2 capital pro rata over the next five years.
NOTE 11 - FEDERAL HOME LOAN BANK ADVANCES
FHLB advances are collateralized by 1-4 family residential real estate loans, business loans, and certain commercial real estate loans. At
December  31, 2024 and 2023, the unpaid principal of the loans pledged to the FHLB of Des Moines was $2.6 billion and $1.9 billion,
respectively. The loans are pledged to the secured line of credit to maintain the borrowing base, which had availability of approximately $1.3
billion and $1.0 billion at December 31, 2024 and 2023, respectively.
The Company did not have any FHLB advances at December 31, 2024 or 2023.
NOTE 12 - OTHER BORROWINGS
Securities Sold Under Agreement to Repurchase
The Company enters into sales of securities under agreements to repurchase. The agreements are transacted with deposit customers and are
utilized as an overnight investment product. The amounts received under these agreements represent short-term borrowings and are reflected as a
liability in the Consolidated Balance Sheets. The securities underlying these agreements are included in investment securities in the Consolidated
Balance Sheets. The Company has no control over the market value of the securities, which fluctuates due to market conditions. However, the
Company is obligated to promptly transfer additional securities if the market value of the securities falls below the repurchase agreement price.
The Company manages this risk by maintaining an unpledged securities portfolio that it believes is sufficient to cover a decline in the market
value of the securities sold under agreements to repurchase.
A summary of securities sold under agreements to repurchase is as follows:
December 31,
($ in thousands)
2024
2023
Securities sold under agreement to repurchase
$
244,618 
$
250,197 
Average balance during the year
164,959 
168,745 
Maximum balance outstanding at any month-end during the year
244,618 
250,197 
Average interest rate during the year
3.44 %
2.16 %
Average interest rate at the year ended
3.09 %
3.56 %
101

Federal Reserve Line
The Bank also has a line with the Federal Reserve Bank of St. Louis which provides additional liquidity. As of December 31, 2024 and 2023,
$2.8 billion and $2.5 billion, respectively, was available under this line. This line was secured by a pledge of certain eligible loans and securities
aggregating $3.2 billion and $2.9 billion, at December 31, 2024 and 2023, respectively. Included in the line at December 31, 2023 was $215.0
million related to the Bank Term Funding program that ended on March 11, 2024. There were no amounts drawn on the Federal Reserve line of
credit as of December 31, 2024 or 2023.
Other Borrowings
The Company had $36.2 million of borrowings from various entities related to New Market Tax Credit investments at December 31, 2024 and
2023. These notes have remaining terms that range from 24-29 years. These notes have an interest rate of 1.0% and are generally interest only
for the first 7 years.
Revolving Credit Line
In February 2016, the Company entered into a senior unsecured revolving credit agreement (the “Revolving Agreement”) with another bank. The
Revolving Agreement had a one-year term that matured on February 22, 2025, allowed for borrowings up to $25 million, and had an interest rate
of one-month Term SOFR plus 185 basis points until February 2025. A fee of 0.40% annually was assessed against the unused commitment. The
proceeds could be used for general corporate purposes.  The Revolving Agreement was subject to ongoing compliance with a number of
customary affirmative and negative covenants as well as specified financial covenants. The revolving credit line was not accessed in 2024 or
2023.
Term Loan
In February 2019, the Company entered into a five year, $40.0 million unsecured term loan agreement (the “Term Loan”) with another bank with
the proceeds primarily used to fund the company’s cash portion of an acquisition in 2019. The interest rate was one-month LIBOR plus 125 basis
points until February 2022. In February 2022, the interest rate on the Term Loan was amended to one-month Term SOFR plus 136 basis points.
The term loan agreement matured in February 2024 and was not renewed.
A summary of the Term Loan is as follows:
December 31,
($ in thousands)
2024
2023
Term Loan
$
— 
$
11,429 
Average balance during the year
1,624 
14,959 
Maximum balance outstanding at any month-end
11,429 
17,143 
Weighted average interest rate during the year
6.78 %
6.44 %
Average interest rate at December 31
— %
6.70 %
NOTE 13 - LITIGATION AND OTHER CONTINGENCIES
The Company, from time to time, is a party to various legal proceedings arising out of its businesses. Management believes there are no such
legal proceedings pending or threatened against the Company in the ordinary course of business, directly, indirectly, or in the aggregate that, if
determined adversely, would have a material adverse effect on the business, consolidated financial condition, results of operations or cash flows
of the Company.
NOTE 14 - REGULATORY CAPITAL
Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum ratios (set forth in the
following table) of total, tier 1, and common equity tier 1 capital to risk-weighted assets, and of tier 1 capital to average assets. Management
believes, as of December 31, 2024 and 2023, that the Company met all capital adequacy requirements to which it is subject.
102

As of December 31, 2024 and 2023, the Bank was categorized as “well-capitalized” under the regulatory framework for prompt corrective
action. To be categorized as “well-capitalized” the Bank must maintain minimum total risk-based capital, tier 1 risk-based capital, common
equity tier 1 risk-based capital, and tier 1 leverage ratios as set forth in the following table. In addition, the Company must maintain an additional
CCB above the regulatory minimum ratio requirements. The CCB is designed to insulate banks from periods of stress and impose constraints on
dividends, share repurchases and discretionary bonus payments when capital levels fall below prescribed levels.
The capital ratios are presented in the following table:
December 31,
2024
2023
EFSC
Bank
EFSC
Bank
To Be Well-
Capitalized
Minimum Ratio
with CCB
Common Equity Tier 1 Capital to Risk Weighted Assets
11.8 %
12.4 %
11.3 %
12.2 %
6.5 %
7.0 %
Tier 1 Capital to Risk Weighted Assets
13.1 %
12.4 %
12.7 %
12.2 %
8.0 %
8.5 %
Total Capital to Risk Weighted Assets
14.6 %
13.4 %
14.2 %
13.2 %
10.0 %
10.5 %
Leverage Ratio (Tier 1 Capital to Average Assets)
11.1 %
10.5 %
11.0 %
10.6 %
5.0 %
N/A
103

NOTE 15 - SHAREHOLDERS’ EQUITY AND COMPENSATION PLANS
 
Shareholders’ Equity
Common Stock
At December 31, 2024 and 2023, the Company has reserved the following shares of its authorized but unissued common stock for possible
future issuance in connection with the following:
December 31,
2024
2023
Outstanding performance units (maximum issuance)
363,070 
273,202 
Outstanding RSU’s
297,122 
290,141 
Outstanding options
510,812 
333,608 
2018 Stock Incentive Plan
290,841 
732,427 
Non-Management Director Plan
104,145 
130,162 
2018 Employee Stock Purchase Plan
399,289 
447,655 
Total
1,965,279 
2,207,195 
Common Stock Repurchase Plan
In May 2022, the Company’s board of directors authorized the repurchase of up to two million shares of the Company’s common stock. The
repurchases may be made in open market or privately negotiated transactions and the stock repurchase program will remain in effect until fully
utilized or until modified, superseded or terminated. At December 31, 2024, there were 1,373,222 shares available for repurchase under the plan.
Preferred Stock
The Company has 5,000,000 shares of authorized preferred stock with a par value of $0.01 with 75,000 shares issued and outstanding at the end
of 2024 and 2023. The Board of Directors has the right to set for each series of preferred stock, subject to the laws of the State of Delaware, the
dividend rate, conversion and redemption terms, voting rights and liquidation preferences, among others. In the fourth quarter 2021, the
Company issued and sold 3,000,000 depositary shares, each representing 1/40th interest in a share of the Company’s 5% Noncumulative,
Perpetual Preferred Stock, Series A (“Series A Preferred Stock”), totaling $72.0 million, net of issuance costs. The depositary shares trade under
the ticker “EFSCP”. The Series A Preferred Stock may be redeemed at the Company’s option, subject to prior regulatory approval, in whole or in
part on any dividend payment date on or after December 15, 2026 or within 90 days following a regulatory capital event, as defined in the
offering documents. If any Series A Preferred Stock are redeemed, a proportionate number of depositary shares will also be redeemed.
Dividends
The Company’s ability to pay dividends to its shareholders is generally dependent upon the payment of dividends by the Bank to the parent
company. The Bank cannot pay dividends to the extent it would be deemed undercapitalized by the FDIC after making such dividend.
Preferred stock dividends, when and if declared by the board of directors, are payable, quarterly in arrears, on March 15, June 15, September 15
and December 15 of each year. If dividends on the Series A Preferred stock have not been declared or paid in six quarterly periods, whether or
not consecutive, the number of directors on the board will automatically be increased by two and the holders of the Series A preferred stock will
be entitled to vote for the additional directors. Quarterly dividends have been declared and paid in all periods since the preferred stock was
issued.
104

Dividends on the Company’s capital stock are prohibited under the terms of the junior subordinated debenture agreements, see “Note 10 –
Subordinated Debentures and Notes,” if the Company is in continuous default on its payment obligations to the capital trusts, has elected to defer
interest payments on the debentures or extends the interest payment period. Furthermore, unless dividends on all outstanding shares of the Series
A Preferred Stock for the most recently completed dividend period have been paid or declared, dividends on, and repurchases of, common stock
is prohibited. At December 31, 2024, the Company was not in default on any of the junior subordinated debenture issuances or preferred stock.
Accumulated Other Comprehensive Income (Loss)
The following table presents the changes in accumulated other comprehensive income (loss) after-tax by component:
($ in thousands)
Net Unrealized Gain
(Loss) on Available-
for-Sale Debt
Securities
Unamortized Gain
(Loss) on Held-to-
Maturity Securities
Net Unrealized Gain
(Loss) on Cash Flow
Hedges
Total
Balance, December 31, 2021
$
5,271 
$
15,684 
$
(2,178)
$
18,777 
Net change
(149,623)
(2,696)
3,210 
(149,109)
Transfer from available-for-sale to held-to-maturity
(197)
197 
— 
— 
Balance, December 31, 2022
$
(144,549)
$
13,185 
$
1,032 
$
(130,332)
Net change
31,705 
(2,605)
217 
29,317 
Balance, December 31, 2023
$
(112,844)
$
10,580 
$
1,249 
$
(101,015)
Net change
(9,288)
(2,492)
(3,923)
(15,703)
Balance, December 31, 2024
$
(122,132)
$
8,088 
$
(2,674)
$
(116,718)
The following table presents the pre-tax and after-tax changes in the components of other comprehensive income:
2024
2023
2022
($ in thousands)
Pre-tax
Tax effect
After-tax
Pre-tax
Tax effect
After-tax
Pre-tax
Tax effect
After-tax
Change in unrealized
gain (loss) on
available-for-sale
securities
$
(12,351)
$
(3,063)
$
(9,288)
$
42,988 
$
10,833 
$
32,155 
$
(200,030) $
(50,407) $
(149,623)
Reclassification of
gain on sale of
available-for-sale
securities
— 
— 
— 
(601)
(151)
(450)
— 
— 
— 
Reclassification of
gain on held-to-
maturity securities
(3,314)
(822)
(2,492)
(3,483)
(878)
(2,605)
(3,605)
(909)
(2,696)
Change in unrealized
gain (loss) on cash
flow hedges
(6,949)
(1,723)
(5,226)
(656)
(165)
(491)
3,741 
943 
2,798 
Reclassification of loss
on cash flow hedges
1,731 
428 
1,303 
945 
237 
708 
551 
139 
412 
Total other
comprehensive income
(loss)
$
(20,883)
$
(5,180)
$
(15,703)
$
39,193 
$
9,876 
$
29,317 
$
(199,343) $
(50,234) $
(149,109)
The pre-tax amount is reported in noninterest income/expense in the Consolidated Statements of Income.
The pre-tax amount is reported in interest income/expense in the Consolidated Statements of Income.
(a)
(a)
(b)
(a)
(b)
105

Compensation Plans
The Company has adopted share-based compensation plans to reward and provide long-term incentive for directors and key employees of the
Company. These plans provide for the granting of stock, stock options, stock-settled stock appreciation rights, and restricted stock units
(“RSUs”), and may contain performance terms for key employees as designated by the Company’s Board of Directors upon the recommendation
of the Compensation Committee of the Board. The Company uses authorized and unissued shares to satisfy share award exercises.
The total excess income tax benefit for share-based compensation arrangements was immaterial for the year ended December 31, 2024, and $0.3
million and $0.1 million for the years ended December 31, 2023, and 2022, respectively. At December 31, 2024, there was $14.0 million of total
unrecognized compensation cost related to unvested share-based compensation awards. The cost is expected to be recognized over a weighted-
average term of approximately one year.
The following table summarizes share-based compensation expense:
For the year ended December 31,
($ in thousands)
2024
2023
2022
Performance stock units
$
2,898 
$
2,879 
$
2,391 
Restricted stock units
5,341 
5,014 
4,156 
Stock options
2,110 
1,609 
916 
Employee stock purchase plan
523 
644 
543 
Total share-based compensation expense
$
10,872 
$
10,146 
$
8,006 
Performance Stock Units
The Company has entered into long-term incentive agreements with certain key employees. These awards are conditioned on certain
performance criteria and market criteria measured against a group of peer banks over a three-year period for each grant. The awards contain
minimum (threshold), target, and maximum (exceptional) performance levels. In the event of a change in control, as defined in the plan, the
awards will vest at least at the target level. The amount of the awards is determined at the end of the three-year vesting and performance period.
The fair value of performance units issued upon vesting in 2024, 2023, and 2022 were $2.6 million, $1.6 million, and $0.5 million, respectively.
Information related to the outstanding grants at December 31, 2024 is shown below:
($ in thousands, except per share data)
2022 - 2024 Cycle
2023 - 2025 Cycle
2024 - 2026 Cycle
Shares issuable at target
41,765 
56,424 
83,346 
Maximum shares issuable
83,530 
112,848 
166,692 
Unrecognized compensation cost
$
92  $
767 
$
2,156 
Weighted average grant date fair value (per share)
$
51.91  $
62.19 
$
38.84 
Maximum Shares Issuable
Weighted Average Grant Date
Fair Value
Outstanding at December 31, 2023
273,202  $
54.82 
Granted
166,692 
38.84 
Vested (issued 64,582 shares)
(76,824)
47.16 
Outstanding at December 31, 2024
363,070  $
49.10 
106

Restricted Stock Units
The Company awards nonvested stock, in the form of RSUs to employees. RSUs generally are subject to continued employment and generally
vest ratably over three to five years. Vesting is accelerated upon a change in control or the employee meeting certain retirement criteria. RSUs do
not carry voting or dividend rights until vested. Sales of the units are restricted prior to vesting.
Various information related to the RSUs is shown below.
At or for the year ended December 31,
($ in thousands except per unit data)
2024
2023
2022
Total fair value of awards vesting during the year
$
4,919 
$
3,894 
$
3,888 
Unrecognized compensation cost
8,328 
8,438 
8,507 
Expected years to recognize unearned compensation
1.5 years
1.7 years
2.0 years
Weighted average grant date fair value per unit
$
41.52 
$
50.46 
$
47.96 
A summary of the status of the Company’s RSU awards as of December 31, 2024 and changes during the year then ended is presented below.
Shares
Weighted Average Grant Date
Fair Value
Outstanding at December 31, 2023
290,141 
$
48.69 
Granted
140,359 
41.52 
Vested
(116,886)
47.22 
Forfeited
(16,492)
45.22 
Outstanding at December 31, 2024
297,122 
$
46.07 
Stock Options
In determining compensation cost for stock options, the Black-Scholes option-pricing model is used to estimate the fair value on date of grant.
The model utilizes several assumptions in its calculations. The risk-free rate for periods within the contractual life of the option is based on the
U.S. Treasury yield in effect at the time of the grant. The expected term of options granted is based on the option's vesting schedule and expected
exercise patterns and represent the period of time options granted are expected to be outstanding. The expected volatility is based on the
historical volatility of the Company's stock and expected term of the option. The dividend yield is determined by annualizing the dividend rate as
a percentage of the Company's stock price.
The following weighted average assumptions were used for grants issued during the years ended December 31, 2024, 2023, and 2022.
Weighted Average
For the year ended December 31,
2024
2023
2022
Risk Free Interest Rate
4.27%
4.09%
1.95%
Expected Dividend Yield
2.53%
1.84%
1.74%
Expected Volatility
35.79%
34.74%
34.54%
Expected Term (years)
6.2
6.3
6.2
Non-qualified stock options have been granted to key employees with exercise prices equal to the market price of the Company’s common stock
at the date of grant and 10-year contractual terms. Stock options have a vesting schedule of three to five years.
107

Following is a summary of stock option activity for 2024.
Shares
Weighted
Average
Exercise Price
Weighted
Average
Remaining
Contractual Term
Outstanding at December 31, 2023
333,608 
$
49.11 
Granted
204,853 
39.50 
Exercised
(12,433)
45.58 
Forfeited
(15,216)
45.84 
Outstanding at December 31, 2024
510,812 
$
45.43 
8.0 years
Exercisable at December 31, 2024
140,375 
$
46.02 
6.6 years
The intrinsic value of options exercised totaled $0.7 million and $0.1 million in 2024 and 2023, respectively. The intrinsic value of options
outstanding, expected to vest, and exercisable totaled $5.6 million, $5.6 million, and $1.5 million, respectively, in 2024. In 2023, the intrinsic
value of options outstanding and expected to vest totaled $1.5 million, and the intrinsic value of options exercisable was immaterial.
Employee Stock Purchase Plan
The Company’s Employee Stock Purchase Plan (“ESPP”) provides its eligible employees with an opportunity to purchase common stock
through accumulated payroll contributions.  The ESPP provides for shares to be purchased at 85% of the lesser of the stock price at the
enrollment date or the exercise date. The maximum number of shares of common stock available for sale under the ESPP is 750,000. In 2024,
2023, and 2022, employees purchased 48,366, 68,286, and 55,123 shares, respectively, and there are 399,289 remaining shares available under
the ESPP at December 31, 2024.
Stock Plan for Non-Management Directors
The Company has adopted a Stock Plan for Non-Management Directors, which provides for issuing up to 400,000 shares of common stock to
non-management directors as compensation. At December 31, 2024, there were 79,900 shares of stock available for grant under the Stock Plan
for Non-Management Directors, exclusive of 24,245 shares to be issued upon deferral release.
Various information related to the Director Plan is shown below.
At or for the year ended December 31,
2024
2023
2022
Shares granted
28,993 
27,016 
23,343 
Weighted average grant date fair value
$
41.10 
$
41.31 
$
42.17 
401(k) Plan
The Company has a 401(k) savings plan which covers substantially all full-time employees over the age of 21 and matches 100% of the first 6%
of employee contributions. The amount charged to expense for the Company’s contributions to the plan was $7.1 million, $6.5 million and $5.8
million for 2024, 2023, and 2022, respectively.
Deferred Compensation Plan
The Company has a nonqualified deferred compensation plan that permits certain executives to participate and defer up to 25% of their base
salary and/or up to 100% of their eligible bonus for a plan year. Participants make an irrevocable election when they elect to participate for a
plan year to receive the vested account balance following their retirement date, or at a future date not less than five years after the beginning of
the plan year. At December 31, 2024, the Company had a liability of $4.2 million related to the deferred compensation plan.
108

NOTE 16 - INCOME TAXES
The components of income tax expense (benefit) for the years ended December 31, are as follows:
Year ended December 31,
($ in thousands)
2024
2023
2022
Current:
Federal
$
41,477 
$
40,471 
$
42,718 
State and local
8,022 
9,616 
11,505 
Total current
49,499 
50,087 
54,223 
Deferred:
Federal
(2,535)
283 
1,853 
State and local
(986)
2,097 
341 
Total deferred
(3,521)
2,380 
2,194 
Total income tax expense
$
45,978 
$
52,467 
$
56,417 
A reconciliation of expected income tax expense, computed by applying the statutory federal income tax rate to income before income taxes
reflected in the Consolidated Statements of Income is as follows:
Year ended December 31,
($ in thousands)
2024
2023
2022
Income tax expense at statutory rate
$
48,561 
$
51,770 
$
54,487 
Increase (reduction) in income tax resulting from:
Tax-exempt interest income, net
(5,124)
(4,942)
(4,351)
State and local income taxes, net
7,334 
9,445 
9,767 
Bank-owned life insurance
(892)
(888)
(545)
Non-deductible expenses
1,524 
2,059 
926 
Tax benefit of low-income housing tax credit ("LIHTC") investments, net
285 
(56)
(195)
Excess tax benefits
28 
(251)
(68)
Federal tax credits
(5,619)
(4,364)
(3,661)
Other, net
(119)
(306)
57 
       Total income tax expense
$
45,978 
$
52,467 
$
56,417 
The net amount recognized as a component of tax expense for tax credits, other tax benefits, and amortization from LIHTC investments
recognized per the table above was immaterial for the years ended December 31, 2024 and December 31, 2023, and $0.2 million for the year
ended December 31, 2022. As of December 31, 2024 and 2023, the carrying value of the investments related to low-income housing tax credits
was $16.7 million and $17.2 million, respectively. No impairment losses have been recognized from forfeiture or ineligibility of tax credits or
other circumstances during the life of any of the investments.
109

A net deferred income tax asset of $85.4 million and $76.7 million is included in other assets in the consolidated balance sheets at December 31,
2024 and 2023, respectively. The tax effect of temporary differences that gave rise to significant portions of the deferred tax assets and deferred
tax liabilities is as follows:
Year ended December 31,
($ in thousands)
2024
2023
Deferred tax assets:
Allowance for loan losses
$
34,212 
$
33,423 
Loans held-for-sale
3,304 
4,463 
Other real estate
39 
— 
Deferred compensation
5,209 
4,746 
Accrued compensation
6,265 
6,047 
Unrealized losses on securities, net
38,734 
33,687 
Net operating losses and tax credits
5,299 
5,544 
Lease liability accrual
6,485 
7,101 
Other investments
5,587 
5,341 
Research and experimental expenses
1,473 
1,944 
Fixed assets
2,802 
2,341 
Deferred expenses
3,021 
1,158 
Other deferred tax assets
3,248 
3,665 
Total deferred tax assets
115,678 
109,460 
Deferred tax liabilities:
Acquired loans
1,922 
2,388 
Intangible assets
8,756 
8,576 
Right of use asset
5,644 
6,301 
Other investments
10,233 
11,834 
Other deferred tax liabilities
951 
841 
Total deferred tax liabilities
27,506 
29,940 
Net deferred tax asset before valuation allowance
88,172 
79,520 
Less: valuation allowance
2,812 
2,812 
Net deferred tax asset
$
85,360 
$
76,708 
As part of an acquisition in 2019, the company acquired net operating loss, tax credit, and capital loss deferred tax assets. Net operating losses
originated in the years 2012, 2014-2017, and 2019 and will expire in the years between 2032-2037. Tax credit carryforwards originated in years
2010-2015 and will expire in the years between 2030-2035.
A valuation allowance is provided on deferred tax assets when it is more likely than not that some portion of the assets will not be realized. The
company determined it was more likely than not that some of the acquired net operating loss and tax credit assets would not be realized and has
recognized a valuation allowance of $2.8 million at December 31, 2024 and 2023, respectively.
The Company and its subsidiaries file income tax returns in the federal jurisdiction and in thirty-one states and localities. The Company is no
longer subject to federal, state or local income tax audits by tax authorities for years before 2019, with the exception of 2016 and 2017 being
open years by state taxing authorities. Net operating losses generated prior to 2016 that are utilized going forward would still be subject to
examination.
As of December 31, 2024, the gross amount of unrecognized tax benefits was $5.0 million and the total amount of net unrecognized tax benefits
that would impact the effective tax rate, if recognized, was $4.0 million compared to $2.4 million and $2.2 million as of December 31, 2023 and
2022, respectively. The Company believes it is
110

reasonably possible the gross amount of unrecognized benefits will be reduced by approximately $0.3 million as a result of a lapse of statute of
limitations in the next 12 months. The Company is under audit by the state of California, Missouri, and Texas, and while the Company has
concluded it has adequately provided for uncertain tax positions, the outcome of such audits are always uncertain and could result in additional
tax expense, though immaterial.
The Company recognizes interest and penalties related to uncertain tax positions in income tax expense and classifies such interest and penalties
in the liability for unrecognized tax benefits. The amount accrued for interest and penalties was $2.1 million as of 2024, $1.0 million as of 2023,
and $0.6 million as of 2022.
The activity in the gross liability for unrecognized tax benefits was as follows:
($ in thousands)
2024
2023
2022
Balance at beginning of year
$
3,077 
$
2,724 
$
2,697 
Additions based on tax positions related to the current year
1,212 
727 
683 
Additions for tax positions of prior years
1,128 
24 
47 
Settlements for tax positions of prior years
— 
— 
(82)
Settlements or lapse of statute of limitations
(401)
(398)
(621)
Balance at end of year
$
5,016 
$
3,077 
$
2,724 
NOTE 17 - COMMITMENTS AND CONTINGENT LIABILITIES
Long-term Lease Commitments
See “Note 5 – Leases” in this report for information regarding the Company’s long-term lease commitments.
Off-balance-Sheet Commitments
The Company issues financial instruments in the normal course of the business of meeting the financing needs of its customers. These financial
instruments include commitments to extend credit and standby letters of credit. These instruments may involve, to varying degrees, elements of
credit and interest rate risk in excess of the amounts recognized in the consolidated balance sheets. The Company’s extent of involvement and
maximum potential exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to
extend credit and standby letters of credit is not more than the contractual amount of these instruments. The Company uses the same credit
policies in making commitments and conditional obligations as it does for financial instruments included on its consolidated balance sheets.
The contractual amounts of off-balance-sheet financial instruments are as follows: 
($ in thousands)
December 31, 2024
December 31, 2023
Commitments to extend credit
$
3,001,565 
$
2,937,760 
Letters of credit
137,926 
107,082 
Tax credits
1,801 
3,514 
Limited partnership commitments
39,278 
32,548 
There was an insignificant amount of unadvanced commitments on impaired loans at December  31, 2024 and December  31, 2023. Other
liabilities include an allowance for credit losses on unadvanced commitments of $6.1 million and $6.6 million at December 31, 2024 and 2023,
respectively.
Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract.
Commitments usually have fixed expiration dates or other termination clauses, may have significant usage restrictions, and may require payment
of a fee. Of the total commitments to extend credit at December  31, 2024, and December  31, 2023, $156.5 million and $191.6 million,
respectively, represent fixed rate loan commitments. Since certain of the commitments may expire without being drawn upon or may be revoked,
the
111

total commitment amounts do not necessarily represent future cash obligations. The Company evaluates each customer’s credit worthiness on a
case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management’s
credit evaluation of the borrower. Collateral held varies, but may include accounts receivable, inventory, premises and equipment, and real estate.
Letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. These letters
of credit are issued to support contractual obligations of the Company’s customers. The credit risk involved in issuing letters of credit is
essentially the same as the risk involved in extending loans to customers. The approximate remaining term of letters of credit range from one
month to 3 years at December 31, 2024.
The Company also has off-balance sheet commitments for purchases of tax credits and commitments for various capital raises for limited
partnership investments.
NOTE 18 - FAIR VALUE MEASUREMENTS
The fair value of an asset or liability is the exchange price that would be received to sell that asset or paid to transfer that liability in an orderly
transaction occurring in the principal market (or most advantageous market in the absence of a principal market) for such asset or liability. Inputs
to valuation techniques include the assumptions that market participants would use in pricing an asset or liability. ASC Topic 820, Fair Value
Measurements and Disclosures, establishes a fair value hierarchy for valuation inputs that gives the highest priority to quoted prices in active
markets for identical assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows:
•
Level 1 Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access
at the measurement date.
•
Level 2 Inputs - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly.
These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities
in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities,
prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other
means.
•
Level 3 Inputs - Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the
assumptions that market participants would use in pricing the assets or liabilities.
 
112

Fair value on a recurring basis
The following table summarizes financial instruments measured at fair value on a recurring basis, segregated by the level of the valuation inputs
within the fair value hierarchy utilized to measure fair value.
 
December 31, 2024
($ in thousands)
Quoted Prices in
Active Markets for
Identical Assets (Level
1)
Significant Other
Observable Inputs
(Level 2)
Significant
Unobservable Inputs
 (Level 3)
Total Fair Value
Assets
Securities available-for-sale
Obligations of U.S. Government-sponsored enterprises
$
— 
$
276,040 
$
— 
$
276,040 
Obligations of states and political subdivisions
— 
409,197 
— 
409,197 
Agency mortgage-backed securities
— 
1,027,394 
— 
1,027,394 
Corporate debt securities
— 
20,746 
— 
20,746 
U.S. Treasury Bills
— 
128,893 
— 
128,893 
Total securities available-for-sale
— 
1,862,270 
— 
1,862,270 
Other investments
— 
2,983 
— 
2,983 
Derivatives
— 
15,144 
— 
15,144 
Total assets
$
— 
$
1,880,397 
$
— 
$
1,880,397 
Liabilities
Derivatives
$
— 
$
18,692 
$
— 
$
18,692 
Total liabilities
$
— 
$
18,692 
$
— 
$
18,692 
 
December 31, 2023
($ in thousands)
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Total Fair
Value
Assets
Securities available-for-sale
Obligations of U.S. Government-sponsored enterprises
$
— 
$
296,446 
$
— 
$
296,446 
Obligations of states and political subdivisions
— 
432,171 
— 
432,171 
Agency mortgage-backed securities
— 
700,381 
— 
700,381 
Corporate debt securities
— 
181,701 
— 
181,701 
U.S. Treasury Bills
— 
7,574 
— 
7,574 
Total securities available-for-sale
— 
1,618,273 
— 
1,618,273 
Other investments
— 
2,941 
— 
2,941 
Derivative financial instruments
— 
17,789 
— 
17,789 
Total assets
$
— 
$
1,639,003 
$
— 
$
1,639,003 
Liabilities
Derivative financial instruments
$
— 
$
16,184 
$
— 
$
16,184 
Total liabilities
$
— 
$
16,184 
$
— 
$
16,184 
•
Securities available-for-sale. Fair values for available-for-sale securities are based upon dealer quotes, market spreads, the U.S. Treasury
yield curve, trade execution data, market consensus prepayment speeds, credit information and the bond’s terms and conditions at the
security level. Changes in fair value are recognized through accumulated other comprehensive income.
113

•
Derivatives. Derivatives are reported at fair value utilizing Level 2 inputs. The Company obtains counterparty quotations to value its
interest rate swaps and caps. In addition, the Company validates the counterparty quotations with third-party valuation sources.
Derivatives with negative fair values are included in Other liabilities in the consolidated balance sheets. Derivatives with positive fair
value are included in Other assets in the consolidated balance sheets. Changes in the fair value of client-related derivative instruments
are recognized through net income. For the years ended December 31, 2024 and 2023, the gains and losses substantially offset each other
due to the Company’s hedging of the client swaps with other bank counterparties.
Fair value on a non-recurring basis
Certain financial assets and financial liabilities are measured at fair value on a non-recurring basis; that is, the instruments are not measured at
fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of
impairment).
•
Individually-evaluated loans. On a quarterly basis, fair value adjustments are recorded as necessary on loans that no longer exhibit risk
characteristics similar to other loans to account for (1) partial write-downs based on the current appraised or market-quoted value of the
underlying collateral or (2) the full charge-off of the loan carrying value. In some cases, the properties for which market quotes or appraised
values have been obtained are located in areas where comparable sales data is limited, outdated, or unavailable. In addition, the Company
may adjust the valuations based on other relevant market conditions or information. Accordingly, fair value estimates, including those
obtained from real estate brokers or other third-party consultants, for collateral-dependent loans are classified in Level 3 of the valuation
hierarchy. Fair value estimates on individually-evaluated loans utilizing a discounted cash flow approach are also classified as Level 3.
•
Other real estate. These assets are initially reported at fair value, less cost to sell, and subsequently at the lower of cost or fair value, less cost
to sell. Fair value is based on third party appraisals of each property and the Company’s judgment of other relevant market conditions. These
are considered Level 3 inputs.
The following tables present financial instruments and non-financial assets still held as of the reporting date measured at fair value on a non-
recurring basis. 
December 31, 2024
(1)
(1)
(1)
(1)
($ in thousands)
Total Fair Value
Quoted Prices in Active
Markets for
Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Individually-evaluated loans
$
15,370 
$
— 
$
— 
$
15,370 
Other real estate
3,955 
— 
— 
3,955 
Total
$
19,325 
$
— 
$
— 
$
19,325 
114

December 31, 2023
(1)
(1)
(1)
(1)
($ in thousands)
Total Fair Value
Quoted Prices in Active
Markets for
Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Individually-evaluated loans
$
5,138 
$
— 
$
— 
$
5,138 
Other real estate
5,736 
— 
— 
5,736 
Total
$
10,874 
$
— 
$
— 
$
10,874 
(1) The amounts represent balances measured at fair value during the period and still held as of the reporting date. 
Carrying amount and fair value
Following is a summary of the carrying amounts and fair values of the Company’s financial instruments on the consolidated balance sheets at
December 31, 2024 and 2023. This summary excludes certain financial assets and liabilities for which carrying value approximates fair value
and financial instruments that are recorded at fair value on a recurring basis disclosed above. Financial instruments for which carrying values
approximate fair value include cash and due from banks, federal funds sold, interest bearing deposits, accrued interest receivable/payable,
demand, savings and money market deposits.
 
December 31, 2024
December 31, 2023
($ in thousands)
Carrying
Amount
Estimated fair
value
Level
Carrying
Amount
Estimated fair
value
Level
Balance sheet assets
 
 
 
 
Securities held-to-maturity, net
$
928,935 
$
858,871 
Level 2
$
750,434 
$
696,647 
Level 2
Other investments
69,801 
69,801 
Level 2
63,255 
63,255 
Level 2
Loans held-for-sale
110 
110 
Level 2
359 
359 
Level 2
Loans, net
11,082,405 
10,983,459 
Level 3
10,749,347 
10,392,551 
Level 3
State tax credits, held-for-sale
14,663 
15,518 
Level 3
22,115 
23,897 
Level 3
Servicing asset
2,256 
3,570 
Level 2
2,861 
3,799 
Level 2
Balance sheet liabilities
 
 
Certificates of deposit
$
1,369,604 
$
1,364,377 
Level 3
$
1,272,914 
$
1,265,905 
Level 3
Subordinated debentures and notes
156,551 
155,102 
Level 2
155,984 
154,354 
Level 2
Other borrowings
280,821 
258,461 
Level 2
297,829 
274,658 
Level 2
Limitations
Fair value estimates are made at a specific point in time based on relevant market information and information about the financial instrument.
These estimates are subjective in nature and involve uncertainties and matters of significant judgment, and therefore, cannot be determined with
precision. Such estimates include the valuation of loans, goodwill, intangible assets, and other long-lived assets, along with assumptions used in
the calculation of income taxes, among others. These estimates and assumptions are based on management’s best estimates and judgment.
Management evaluates its estimates and assumptions on an ongoing basis using experience and other factors, including the current economic
environment. Such estimates and assumptions are adjusted when facts and circumstances dictate. Changing real estate values, illiquid credit
markets, volatile equity markets, and changes in consumer spending have combined to increase the uncertainty inherent in such estimates and
assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates.
Changes in estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future
periods. In addition, these estimates do not reflect any premium or discount that could result from offering for sale the Company’s entire
holdings of a particular financial instrument at one time. Fair value estimates are based on existing on-balance and off-balance-sheet financial
instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered
financial instruments. In addition, the tax ramifications related to the realization of the unrealized gains
115

and losses can have a significant effect on fair value estimates and have not been considered in many of the estimates.
NOTE 19 - PARENT COMPANY ONLY CONDENSED FINANCIAL STATEMENTS
Condensed Balance Sheets
December 31,
($ in thousands)
2024
2023
Assets
Cash
$
123,956 
$
100,418 
Investment in Bank
1,824,550 
1,748,260 
Investment in nonbank subsidiaries
8,717 
11,267 
Other assets
26,664 
27,701 
   Total assets
$
1,983,887 
$
1,887,646 
Liabilities and Shareholders’ Equity
Subordinated debentures and notes
$
156,551 
$
155,984 
Notes payable
— 
11,429 
Accounts payable and other liabilities
3,334 
4,165 
Shareholders' equity
1,824,002 
1,716,068 
   Total liabilities and shareholders' equity
$
1,983,887 
$
1,887,646 
Condensed Statements of Income
Year ended December 31,
($ in thousands)
2024
2023
2022
Income:
Dividends from Bank
$
115,000 
$
45,000 
$
75,000 
Dividends from nonbank subsidiaries
720 
4,875 
1,700 
Other
3,959 
7,736 
1,086 
Total income
119,679 
57,611 
77,786 
Expenses:
Interest expense
10,671 
10,856 
9,825 
Other expenses
9,246 
8,774 
8,580 
Total expenses
19,917 
19,630 
18,405 
Income before taxes and equity in undistributed earnings of subsidiaries
99,762 
37,981 
59,381 
Income tax benefit
3,530 
2,520 
3,585 
Net income before equity in undistributed earnings of subsidiaries
103,292 
40,501 
62,966 
Equity in undistributed earnings of subsidiaries
81,974 
153,558 
140,077 
Net income
$
185,266 
$
194,059 
$
203,043 
116

Condensed Statements of Cash Flows
Year ended December 31,
($ in thousands)
2024
2023
2022
Cash flows from operating activities:
Net income
$
185,266 
$
194,059 
$
203,043 
Adjustments to reconcile net income to net cash provided by operating activities:
Share-based compensation
1,675 
4,439 
8,006 
Net income of subsidiaries
(197,694)
(203,433)
(216,777)
Dividends from subsidiaries
115,720 
49,875 
76,700 
Other, net
(1,020)
(421)
6,102 
Net cash provided by operating activities
103,947 
44,519 
77,074 
Cash flows from investing activities:
Cash proceeds from subsidiaries
2,188 
— 
— 
Purchases of other investments
(1,216)
(1,002)
(2,187)
Proceeds from distributions on other investments
2,549 
3,314 
3,878 
Net cash provided by investing activities
3,521 
2,312 
1,691 
Cash flows from financing activities:
Repayment of long-term debt
(11,429)
(5,714)
(5,714)
Dividends paid on common stock
(39,550)
(37,368)
(33,602)
Repurchase of common stock
(29,641)
— 
(32,923)
Dividends paid on preferred stock
(3,750)
(3,750)
(4,041)
Other
440 
1,401 
1,773 
Net cash used in financing activities
(83,930)
(45,431)
(74,507)
Net increase in cash and cash equivalents
23,538 
1,400 
4,258 
Cash and cash equivalents, beginning of year
100,418 
99,018 
94,760 
Cash and cash equivalents, end of year
$
123,956 
$
100,418 
$
99,018 
117

NOTE 20 - SUPPLEMENTAL FINANCIAL INFORMATION
The following table presents other income and other expense components, including items that exceed one percent of the aggregate of total
interest income and noninterest income in one or more of the periods indicated:
Year ended December 31,
($ in thousands)
2024
2023
2022
Other income:
Bank-owned life insurance
$
3,737 
$
3,688 
$
3,324 
Community development fees
2,440 
4,037 
5,304 
Net gain (loss) on sales of other real estate owned
3,089 
187 
(93)
Other income
12,721 
15,000 
8,182 
Total other noninterest income
$
21,987 
$
22,912 
$
16,717 
Other expense:
Amortization of intangibles
$
3,834 
$
4,601 
$
5,367 
Banking expenses
8,409 
8,110 
7,212 
FDIC and other insurance
13,161 
13,164 
7,098 
Loan, legal expenses
8,749 
8,639 
6,943 
Other professional services
6,671 
7,040 
5,399 
Other expenses
29,706 
32,332 
25,854 
Total other noninterest expenses
$
70,530 
$
73,886 
$
57,873 
NOTE 21 - SEGMENT REPORTING
The Company has determined it has one operating and reportable segment. The economic characteristics, including the nature, the type or class
of customer, and the nature of the regulatory environment of the products, services and business lines of the Company are all similar. The
Company provides a full range of banking services, including mortgage, tax credit brokerage, wealth management and traditional banking
services, to individuals and corporate customers. Refer to “Item 8. Note 1 – Summary of Significant Accounting Policies” for the accounting
policies of the Company.
The Company’s chief operating decision maker (“CODM”) is the chief executive officer. The operating results that are regularly reviewed by the
CODM are the consolidated results of the Company. The CODM uses the consolidated results of the Company in deciding whether to reinvest
profits into the segment or into other parts of the entity, such as for acquisitions or to pay dividends. The CODM assesses performance for the
segment and decides how to allocate resources based on net income, reported on the income statement as consolidated net income. The CODM
is provided with the consolidated financial statement package on a monthly basis.
The Company considered the following factors, among others, in determining significant segment expenses: the magnitude of the expense item
and its relevance to the segment’s performance, the variability and volatility of the expense item, and whether the expenses are used by the
CODM. The Company’s significant segment revenues and expenses that are regularly provided to the CODM, including the Company’s profit or
loss, have been included within the primary financial statements and notes thereto. Refer to “Item 8. Consolidated Financial Statements” and
“Item 8. Note 20 - Supplemental Financial Information” for these figures.
118

ITEM 9: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A: CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the Company’s disclosure
controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, the “Act”) as of
December  31, 2024. Based upon this evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that as of
December 31, 2024, such disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company
in the reports it files or submits under the Act is accumulated and communicated to the Company’s management (including the Chief Executive
Officer and Chief Financial Officer) to allow timely decisions regarding required disclosure, and is recorded, processed, summarized and
reported within the time periods specified in the SEC’s rules and forms.
Management’s Assessment of Internal Control Over Financial Reporting
Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in
Rule 13a-15(f) and 15(d)-15(f) under the Act). The Company’s internal control system is a process designed to provide reasonable assurance to
the Company’s management and Board of Directors regarding the preparation and fair presentation of published financial statements.
The Company’s internal control over financial reporting includes policies and procedures that pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect transactions and dispositions of assets; provide reasonable assurances that transactions are
recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United
States of America, and that receipts and expenditures are being made only in accordance with authorizations of management and the directors of
the Company; and provide reasonable assurance regarding prevention or untimely detection of unauthorized acquisition, use or disposition of the
Company’s assets that could have a material effect on the Company’s financial statements.
All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective
can provide only reasonable assurance with respect to financial reporting. Further, because of changes in conditions, the effectiveness of any
system of internal control may vary over time. The design of any internal control system also factors in resource constraints and consideration
for the benefit of the control relative to the cost of implementing the control. Because of these inherent limitations in any system of internal
control, management cannot provide absolute assurance that all control issues and instances of fraud within the Company have been detected.
Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024. In making this
assessment, management used the criteria set forth by the Internal Control - Integrated Framework (2013) issued by the Committee of
Sponsoring Organizations of the Treadway Commission. Management has concluded that the Company maintained an effective system of
internal control over financial reporting based on these criteria as of December 31, 2024.
The Company’s independent registered public accounting firm, Deloitte & Touche LLP, who audited the consolidated financial statements, has
issued an audit report on the Company’s internal control over financial reporting as of December 31, 2024, and it is included herein. See "Item 8.
Financial Statements and Supplementary Data - Report of Independent Registered Public Accounting Firm."
119

Changes in Internal Control Over Financial Reporting
The Company completed the conversion of its legacy core system into a new core banking platform. This upgrade included enhancements to the
loan and deposit areas, as well as digital banking and the general ledger, among others. The conversion was completed October 11, 2024 and, as
a result, there were certain changes to the Company’s internal control over financial reporting to align with the new system functionality and
updated processes.
There have been no other changes in the Company’s internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under
the Act) that occurred during the Company’s quarter ended December  31, 2024 that have materially affected, or are reasonably likely to
materially affect, the Company’s internal control over financial reporting.
ITEM 9B: OTHER INFORMATION
On December 17, 2024, James B. Lally, Chief Executive Officer and Director, entered into a trading plan intended to satisfy the affirmative
defense conditions of Rule 10b5-1(c) under the Exchange Act. The plan provides for the sale, subject to certain price limits, of up to 10,778
shares of common stock. Mr. Lally’s plan will expire on September 18, 2025, subject to early termination in accordance with the terms of the
plan.
No other officer or director of the Company adopted or terminated any contract, instruction, or written plan for the purchase or sale of securities
of the Company’s common stock that is intended to satisfy the affirmative defense conditions of Securities Exchange Act Rule 10b5-1(c) or any
non-Rule 10b5-1 trading arrangement as defined in 17 CFR § 229.408(c) during the year ended December 31, 2024.
ITEM 9C: DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
PART III
ITEM 10: DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information required by this item is incorporated herein by reference to the Board and Committee Information and Executive Officer
sections of the Company’s Proxy Statement for its 2025 Annual Meeting of Shareholders, which will be filed pursuant to Regulation 14A under
the Securities Exchange Act of 1934, as amended, not later than 120 days after December 31, 2024.
The Company has adopted an Insider Trading Policy which governs the purchase, sale and/or other disposition of the Company’s securities by its
directors, officers and employees. This policy is reasonably designed to promote compliance with applicable insider trading laws, rules and
regulations and Nasdaq listing standards. A copy of the Insider Trading Policy is filed as Exhibit 19 to this Report.
Governance:
The Company has adopted a Code of Ethics applicable to all of its directors and employees, including the principal executive officer, principal
financial officer and principal accounting officer. A copy of the Code of Ethics is available on the Company’s website at
www.enterprisebank.com.
ITEM 11: EXECUTIVE COMPENSATION
The information required by this item is incorporated herein by reference to the Executive Compensation section of the Company’s Proxy
Statement for its 2025 Annual Meeting of Shareholders, which will be filed pursuant to Regulation 14A under the Securities Exchange Act of
1934, as amended, not later than 120 days after December 31, 2024.
120

ITEM 12: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
Securities Authorized for Issuance Under Equity Compensation Plans
The following table provides information regarding the securities authorized for issuance under our equity compensation plans as of
December 31, 2024.
EQUITY COMPENSATION PLAN INFORMATION
Plan Category
Number of securities to
be issued upon exercise
of outstanding options,
warrants and rights (a)
Weighted-average
exercise price of
outstanding options,
warrants and rights (b)
Number of securities
remaining available for
future issuance under
equity compensation
plans (excluding
securities reflected in
column (a)) (c)
Equity compensation plans approved by security holders
1,195,249 
$
45.43 
770,030 
Equity compensation plans not approved by security holders
— 
— 
— 
Total
1,195,249 
$
45.43 
770,030 
 Includes the following:
•
297,122 shares of common stock to be issued upon vesting of outstanding restricted stock units under the 2018 Stock Incentive Plan;
•
363,070 shares of common stock to be issued upon vesting of outstanding performance units under the 2018 Stock Incentive Plan;
•
510,812 shares of common stock to be issued upon exercise of outstanding non-qualified stock options; and
•
24,245 shares of common stock to be issued upon deferral release of common stock under the Non-Management Director Stock Plan.
 Includes the following:
•
price only applicable to the outstanding non-qualified stock options.
 Includes the following:
•
290,841 shares of common stock available for issuance under the 2018 Stock Incentive Plan;
•
79,900 shares of common stock available for issuance under the Non-Management Director Stock Plan; and
•
399,289 shares of common stock available for issuance under the 2018 Employee Stock Purchase Plan.
Additional information required by this item is incorporated herein by reference to the Information Regarding Beneficial Ownership of Certain
Beneficial Owners and Management section of the Company’s Proxy Statement for its 2025 Annual Meeting of Shareholders, which will be filed
pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended, not later than 120 days after December 31, 2024.
ITEM 13: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information required by this item is incorporated herein by reference to the Related Person Transactions section of the Company’s Proxy
Statement for its 2025 Annual Meeting of Shareholders, which will be filed pursuant to Regulation 14A under the Securities Exchange Act of
1934, as amended, not later than 120 days after December 31, 2024.
(a) 
(b)
(c) 
121

ITEM 14: PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by this item is incorporated by reference to the Fees Paid to Independent Registered Public Accounting Firm section of
the Company’s Proxy Statement for its 2025 Annual Meeting of Shareholders, which will be filed pursuant to Regulation 14A under the
Securities Exchange Act of 1934, as amended, not later than 120 days after December 31, 2024.
122

PART IV
ITEM 15: EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a)    1. Financial Statements
The following consolidated financial statements of Enterprise Financial Services Corp and its subsidiaries and independent auditors’
reports are included in Part II, Item 8, of this Form 10-K and are incorporated by reference from Part II, Item 8 hereof:
Report of Independent Registered Public Accounting Firm
Consolidated Balance Sheets at December 31, 2024 and 2023
Consolidated Statements of Income for the years ended December 31, 2024, 2023, and 2022
Consolidated Statements of Comprehensive Income for the years ended December 31, 2024, 2023, and 2022
Consolidated Statements of Shareholders’ Equity for the years ended December 31, 2024, 2023, and 2022
Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023, and 2022
Notes to Consolidated Financial Statements
    2. Financial Statement Schedules
All financial statement schedules have been omitted, as they are either inapplicable or included in the Notes to Consolidated Financial
Statements.
    3. Exhibits
   No.        Description
2.1    Agreement and Plan of Merger, dated April 26, 2021 by and among Enterprise Financial Services Corp, Enterprise Bank & Trust, First Choice
Bancorp and First Choice Bank (incorporated by reference to Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed on
April 26, 2021 (File No. 001-15373)).
3.1    Certificate of Incorporation of Registrant, (incorporated herein by reference to Exhibit 3.1 of Registrant's Registration Statement on Form S-1
filed on December 16, 1996 (File No. 333-14737)).
3.2       Amendment to the Certificate of Incorporation of Registrant (incorporated herein by reference to Exhibit 4.2 to Registrant's Registration
Statement on Form S-8 filed on July 1, 1999 (File No. 333-82087)).
3.3    Amendment to the Certificate of Incorporation of Registrant (incorporated herein by reference to Exhibit 3.1 to Registrant's Quarterly Report on
Form 10-Q for the period ending September 30, 1999 filed on November 12, 1999 (File No. 001-15373)).
3.4    Amendment to the Certificate of Incorporation of Registrant (incorporated herein by reference to Exhibit 99.2 to Registrant's Current Report on
Form 8-K filed on April 30, 2002 (File No. 001-15373)).
3.5    Amendment to the Certificate of Incorporation of Registrant (incorporated herein by reference to Appendix A to Registrant's Proxy Statement on
Form 14-A filed on November 20, 2008 (File No. 001-15373)).
3.6    Amendment to the Certificate of Incorporation of Registrant (incorporated herein by reference to Exhibit 3.1 to the Registrant's Quarterly Report
on Form 10-Q for the period ending June 30, 2014 filed on July 29, 2014 (File No. 001-15373)).
123

3.7    Amendment to the Certificate of Incorporation of Registrant (incorporated herein by reference to Exhibit 3.8 to Registrant’s Quarterly Report on
Form 10-Q filed on July 26, 2019 (File No. 001-15373)).
3.8       Amendment to the Certificate of Incorporation of Registrant (incorporated herein by reference to Appendix C to Registrant’s Registration
Statement on Form S-4/A filed on June 2, 2021 (File No. 333-256265)).
3.9    Certificate of Designations of Registrant for Fixed Rate Cumulative Perpetual Preferred Stock, Series A, dated December 17, 2008 (incorporated
herein by reference to Exhibit 3.1 to Registrant's Current Report on Form 8-K filed on December 23, 2008 (File No. 001-15373)).
3.10    Certificate of Elimination of Registrant’s Certificate of Designation, Preferences, and Rights of the Fixed Rate Cumulative Perpetual Preferred
Stock, Series A, dated November 9, 2021 (incorporated herein by reference to Exhibit 3.1 to Registrant’s Current Report on Form 8-
K filed on November 9, 2021 (File No. 001-15373)).
3.11        Certificate of Designation of Registrant of Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A, dated November 16, 2021
(incorporated herein by reference to Exhibit 3.1 to Registrant’s Current Report on Form 8-K filed on November 17, 2021 (File No.
001-15373)).
3.12    Amended and Restated Bylaws of Registrant (incorporated herein by reference to Exhibit 3.1 to Registrant's Current Report on Form 8-K filed
on June 12, 2015 (File No. 001-15373)).
4.1    Description of Registrant’s Securities (incorporated by reference to Exhibit 4.1 to Registrant's Report on Form 10-K filed on February 25, 2022
(File No. 001-15373)).
4.2    Long-term borrowing instruments are omitted pursuant to Item 601(b)(4)(iii) of Regulation S-K. The Company undertakes to furnish copies of
such instruments to the Securities and Exchange Commission upon request.
10.1.1*    Executive Employment Agreement by and between Enterprise Financial Services Corp and James B. Lally, dated May 2, 2017 (incorporated
by reference to Exhibit 10.1.1 to the Current Report on Form 8-K of Registrant filed on June 6, 2017 (File No. 001-15373)), and
amended by that First Amendment to Executive Employment Agreement dated as of August 4, 2023 (incorporated by reference to
Exhibit 10.1.1 to Registrant’s Quarterly Report on Form 10-Q for the period ending June 30, 2023 filed on August 4, 2023 (File No.
001-15373)).
10.1.2*    Executive Employment Agreement dated September 13, 2013 by and between Enterprise Financial Services Corp and Keene S. Turner
(incorporated by reference herein to Exhibit 10.1 to Registrant’s Quarterly Report on Form 10-Q for the period ending September
30, 2013 filed on November 12, 2023 (File No. 001-15373)), amended by that First Amendment of Executive Employment
Agreement dated as of February 27, 2015 (incorporated herein by reference to Exhibit 10.1.7 to the Registrant’s Annual Report on
Form 10-K filed on February 27, 2015 (File No. 001-15373)), amended by that Second Amendment to Executive Employment
Agreement dated as of October 29, 2015 (incorporated by reference to Exhibit 10.1.2 to the Registrant’s Quarterly Report on Form
10-Q for the period ending September 30, 2015 filed on October 30, 2015 (File No. 001-15373)), and amended by that Third
Amendment to Executive Employment Agreement dated as of August 4, 2023 (incorporated by reference to Exhibit 10.2 to
Registrant’s Quarterly Report on Form 10-Q for the period ending June 30, 2023 filed on August 4, 2023 (File No. 001-15373)).
124

10.1.3*        Executive Employment Agreement dated effective January 1, 2005 by and between Enterprise Financial Services Corp and Scott R.
Goodman, amended by that First Amendment of Executive Employment Agreement dated as of December 31, 2008 (incorporated
herein by reference to Exhibit 10.1.5 to Registrant’s Annual Report on Form 10-K filed on March 15, 2013 (File 001-15373)),
amended by that Second Amendment of Executive Employment Agreement dated October 11, 2013 (incorporated herein by
reference to Exhibit 10.1.5 to Registrant’s Annual Report on Form 10-K filed on March 17, 2014 (File 001-15373)), and amended
by that Third Amendment to Executive Employment Agreement dated as of August 4, 2023 (incorporated by reference to Exhibit
10.3 to Registrant’s Quarterly Report on Form 10-Q for the period ending June 30, 2023 filed on August 4, 2023 (File No. 001-
15373)).
    
10.1.4*    Amended and Restated Executive Employment Agreement dated as of October 24, 2019 by and between Enterprise Financial Services Corp
and Douglas N. Bauche (incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q of the Registrant,
filed with the Commission on October 25, 2019 (File No. 001-15373)), and amended by that First Amendment to Executive
Employment Agreement dated as of August 4, 2023 (incorporated by reference to Exhibit 10.4 to Registrant’s Quarterly Report on
Form 10-Q for the period ending June 30, 2023 (File No. 001-15373)).
10.1.5*        Executive Employment Agreement dated as of October 24, 2019 by and between Enterprise Financial Services Corp and Nicole M.
Iannacone (incorporated herein by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q of the Registrant, filed with the
Commission on October 25, 2019 (File No. 001-15373)), and amended by that First Amendment to Executive Employment
Agreement dated as of August 4, 2023 (incorporated by reference to Exhibit 10.5 to Registrant’s Quarterly Report on Form 10-Q for
the period ending June 30, 2023 (File No. 001-15373)).
10.1.6*    Executive Employment Agreement dated as of October 24, 2019 by and between Enterprise Financial Services Corp and Mark G. Ponder
(incorporated herein by reference to Exhibit 10.3 to the Quarterly Report on Form 10-Q of the Registrant, filed with the Commission
on October 25, 2019 (File No. 001-15373)), and amended by that First Amendment to Executive Employment Agreement dated as
of August 4, 2023 (incorporated by reference to Exhibit 10.1.6 to Registrant’s Annual Report on Form 10-K filed on February 26,
2024 (File No. 001-15373)).
10.1.7*        Enterprise Financial Services Corp Amended and Restated Deferred Compensation Plan I dated effective as of December 31, 2008
(incorporated by reference to Exhibit 10.9 to Registrant's Report on Form 10-K for the year ended December 31, 2008 filed on
March 16, 2009 (File No. 001-15373)).
10.1.8*    Enterprise Financial Services Corp Stock Plan for Non-Management Directors (incorporated herein by reference to Registrant’s Proxy
Statement on Schedule 14-A filed on March 7, 2006, as amended on Schedule 14A filed on April 23, 2012 (File No. 001-15373),
and as amended on Schedule 14A filed on April 17, 2019 (File No. 001-15373), and as amended on Schedule 14A filed on March
29, 2023 (File No. 001-15373)).
10.1.9*    Enterprise Financial Services Corp 2023 Annual Incentive Plan (incorporated herein by reference to Exhibit 10.1.9 to Registrant’s Report on
Form 10-K for the year ended December 31, 2022 filed on February 24, 2023 (File No. 001-15373)).
10.1.10*    Enterprise Financial Services Corp Amended and Restated 2018 Stock Incentive Plan (incorporated herein by reference to Appendix A to
Registrant’s Proxy Statement on Schedule 14A, filed on March 14, 2018 (File No. 001-15373), and as further amended by the Proxy
Statements filed on March 17, 2021 (File No. 000-15373) and March 29, 2023 (File No. 000-15373)).
10.1.11*    Enterprise Financial Services Corp 2018 Employee Stock Purchase Plan (incorporated herein by reference to Appendix B to Registrant’s
Proxy Statement on Schedule 14A, filed on March 14, 2018 (File No. 001-15373)).
125

10.1.12*        Form of Enterprise Financial Services Corp LTIP Grant Agreement,  pursuant to Amended and Restated 2018 Stock Incentive Plan
(incorporated herein by reference to Exhibit 10.1 to Registrant’s Quarterly Report on Form 10-Q for the period ended March 31,
2018 filed on April 27, 2018 (File No. 001-15373)).    
10.1.13*    Form of Enterprise Financial Services Corp Stock Option Award Agreement, pursuant to Amended and Restated 2018 Stock Incentive Plan
(incorporated herein by reference to Exhibit 10.1.14 to Registrant’s Annual Report on Form 10-K filed on February 19, 2021 (File
No. 001-15373)).
19+    Enterprise Financial Services Corp Insider Trading Policy.
21.1+    Subsidiaries of Registrant.
23.1+    Consent of Deloitte & Touche LLP.
24.1+    Power of Attorney.
31.1+    Chief Executive Officer’s Certification required by Rule 13(a)-14(a).
31.2+    Chief Financial Officer’s Certification required by Rule 13(a)-14(a).
32.1+    Chief Executive Officer Certification pursuant to 18 U.S.C. § 1350, as adopted pursuant to section § 906 of the Sarbanes-Oxley Act of 2002.
32.2+    Chief Financial Officer Certification pursuant to 18 U.S.C. § 1350, as adopted pursuant to section § 906 of the Sarbanes-Oxley Act of 2002.
97    Enterprise Financial Services Corp Financial Restatement Clawback Policy (incorporated herein by reference to Exhibit 97 to Registrant's Annual
Report on Form 10-K filed on February 26, 2024).
101+    Pursuant to Rule 405 of Regulation S-T, the following financial information from the Company’s Annual Report on Form 10-K for the period
ended  December  31, 2024, is formatted in Inline XBRL interactive data files: (i) Consolidated Balance Sheet at December  31,
2024 and December 31, 2023; (ii) Consolidated Statements of Income for the years ended December 31, 2024, 2023, and 2022; (iii)
Consolidated Statements of Comprehensive Income for the years ended December 31, 2024, 2023, and 2022; (iv) Consolidated
Statements of Shareholders’ Equity for the years ended December 31, 2024, 2023, and 2022; (v) Consolidated Statements of Cash
Flows for the years ended December 31, 2024, 2023, and 2022; and (vi) Notes to Consolidated Financial Statements.
104+    The cover page of Enterprise Financial Services Corp’s Annual Report on Form 10-K for the year ended December 31, 2024, formatted in
Inline XBRL (contained in Exhibit 101).
* Management contract or compensatory plan or arrangement.
+ Filed herewith
(b)     The exhibits not incorporated by reference herein are filed herewith.
(c)     The financial statement schedules are either included in the Notes to Consolidated Financial Statements or omitted if inapplicable.
ITEM 16: FORM 10-K SUMMARY
None.
126

SIGNATURES
    Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized on February 28, 2025.
ENTERPRISE FINANCIAL SERVICES CORP
   
/s/ James B. Lally
James B. Lally
Chief Executive Officer and Director
127

    
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the
registrant and in the capacities indicated on February 28, 2025.
Signatures
Title
/s/ James B. Lally
Chief Executive Officer and Director
(Principal Executive Officer)
James B. Lally
/s/ Keene S. Turner
Executive Vice President and Chief Financial Officer (Principal Financial
Officer)
Keene S. Turner
/s/ Troy R. Dumlao
Chief Accounting Officer
(Principal Accounting Officer)
Troy R. Dumlao
/s/ Michael A. DeCola*
Michael A. DeCola
Chairman of the Board of Directors
/s/ Lyne B. Andrich*
Lyne B. Andrich
Director
/s/ Michael E. Finn*
Michael E. Finn
Director
/s/ Robert E. Guest, Jr.*
Robert E. Guest, Jr.
Director
/s/ James M. Havel*
James M. Havel
Director
/s/ Michael R. Holmes*
Michael R. Holmes
Director
/s/ Nevada A. Kent, IV*
Nevada A. Kent, IV
Director
/s/ Marcela Manjarrez*
Marcela Manjarrez
Director
/s/ Stephen P. Marsh*
Stephen P. Marsh
Director
/s/ Daniel A. Rodrigues*
Daniel A. Rodrigues
Director
/s/ Richard M. Sanborn*
Richard M. Sanborn
Director
/s/ Eloise E. Schmitz*
Eloise E. Schmitz
Director
/s/ Sandra A. Van Trease*
Sandra A. Van Trease
Director
/s/ Lina A. Young*
Lina A. Young
Director
*By: /s/ Keene S. Turner
Keene S. Turner
Attorney-In-Fact
February 28, 2025    
128

EXHIBIT 19
Enterprise Financial Services Corp
Insider Trading Policy
100. Policy Statement
Federal securities laws prohibit the purchase or sale of securities by persons associated with the Company who are aware of material nonpublic
information about a company, as well as the disclosure of material nonpublic information (defined below) about a company to others who then
trade in such company’s securities. The prohibitions against insider trading apply to trading, tipping, and making recommendations to trade by
virtually any person, including all persons associated with the Company. These transactions are commonly known as “insider trading.” Persons
who are found to have traded on the basis of “inside information” in violation of the applicable laws may incur civil liabilities and criminal
penalties. The federal securities laws also impose potential liability on companies and other “controlling persons” if they fail to take reasonable
steps to prevent insider trading by Company personnel.
200. Applicability
In light of the severity of the possible sanctions to both you individually and to us as the Company, the Board of Directors has established this
Insider Trading Policy (this “Policy”), which is annually reviewed and approved by the Board of Directors and attested by Insiders, to assist all
of us in complying with our obligations under federal and state securities laws. For purposes of this Policy, the term “Company” means
Enterprise Financial Services Corp (“EFSC”) and its subsidiaries, including Enterprise Bank & Trust (the "Bank" or “EB&T”). This Policy
applies to all “Insiders," unless otherwise specified. For the purposes of this Policy, an “Insider” is any person who possesses material nonpublic
information and is:
1.
A member of the EFSC Board of Directors or the EB&T Board of Directors;
2.
Company officers and employees;
3.
An independent contractor or other person in a special relationship with the Company, e.g., its auditors, consultants or attorneys that
may, in the course of their work with the Company, receive access to material nonpublic information;
4.
A family member who resides with any person listed in (i)-(iii) above;
5.
A family member who does not reside with any person listed in (i)-(iii) above but whose transactions in Company securities are directed
by such person or are otherwise subject to that person’s influence or control (such as parents or grown children who consult with any
such person listed in (i)-(iii) above before they trade in Company securities); or
6.
Any entity controlled by any person listed in (i)-(v) above, including, but not limited to, any corporations, partnerships, limited liability
companies or trusts.
It is the responsibility of each Insider to make sure that any family member, household member, or any relevant entity or other person controlled
by such Insider complies with this Policy.
This Policy applies to (i) all transactions in the Company’s securities, including common stock, preferred stock, debt securities, restricted stock,
options and warrants to purchase EFSC common stock and any other equity securities or debt securities, such as EFSCP, that the Company may
issue from time to time and (ii) transactions in other company's securities made based upon knowledge of material nonpublic information.

If you are in possession of material nonpublic information when you cease being a director or employee, this Policy will continue to apply until
that information has become public or is no longer material, as discussed in further detail in Section 300 below.
This Policy is not intended to replace your responsibility to understand and comply with the applicable laws and regulations on insider trading.
Questions regarding this Policy should be directed to the Company’s Insider Trading Compliance Officer or Chief Legal Officer.
205. Governance
This Policy will be reviewed by the Bank’s Strategy Group and the Nominating & Governance Committee and submitted to the EFSC and
EB&T Boards of Directors for approval annually or if significant changes are proposed.
300. Policy
No Trading or Acting on Inside Information
As an Insider, if you are aware of material nonpublic information (the terms “material” and “nonpublic” are discussed in further detail in Section
400) relating to the Company or relating to any other company that you obtained in the course of your involvement with the Company, you may
not, either directly or through family members or other persons or entities, do any of the following:
•
Buy, sell, or offer to buy or sell Company securities (other than pursuant to a pre-approved trading plan that complies with Rule 10b5-1
of the Securities Exchange Act of 1934 (the “Exchange Act)), including initial elections, changes in elections or reallocation of funds
relating to 401(k) plan accounts or Employee Stock Purchase Plan (the “ESPP”) participation, or
•
Engage in any other action to take personal advantage of that information, or
•
Disclose (“tip”) that information to others outside the Company, including family and friends.
At any time after termination of service to the Company, if you are in possession of material nonpublic information obtained in the course of
your involvement with the Company, you may not act on such information, including, without limitation, buying or selling Company securities
or the securities of another company, including our customers or suppliers until that information has become public or is no longer material. For
more information on our policy for trading in securities of another company please see the section “Trading in Other Securities” below.
Transactions that may be necessary or justifiable for independent reasons (such as the need to raise money for an emergency expenditure) are not
exempted from this Policy. The securities laws do not recognize such mitigating circumstances, and, in any event, even the appearance of an
improper transaction must be avoided to preserve the Company's reputation for adhering to the highest standards of conduct.
No Trading or Acting during Blackout Periods
As set forth in more detail in Section 400, certain Insiders are prohibited from, directly or through family members or other persons or entities,
buying or selling Company securities during any "Blackout Periods" that occur each fiscal quarter (see Section 400 for more information).
If your last day of employment or service falls in an applicable Blackout Period, you may not buy or sell our securities until the end of that
Blackout Period.

Questions regarding a Blackout Period such as confirmation of the blackout dates should be directed to the Insider Trading Compliance Officer.
No Individual Disclosure of Information
Under Regulation FD of the federal securities laws, the Company is required to avoid the selective disclosure of material nonpublic information.
The Company has established procedures for releasing material information in a manner that is designed to achieve broad public dissemination
of the information immediately upon its release. Therefore:
•
No Insider (other than the Chief Executive Officer, Chairman of the Board or Chief Financial Officer or any designee of such persons)
who receives or has access to the Company’s material nonpublic information may comment on stock price movement or rumors
concerning corporate developments that are of possible significance to the investing public.
•
If you comment on stock price movement or rumors, or disclose material nonpublic information to a third party, you must immediately
contact the Chief Executive Officer, Chairman of the Board, Chief Financial Officer or Chief Legal Officer.
Other Prohibited Transactions
The Company considers it improper and inappropriate for any Insider to engage in speculative transactions in the Company’s securities or other
transactions, which might give the appearance of impropriety. Therefore, this Policy also prohibits the following transactions, unless advance
approval is obtained from the Insider Trading Compliance Officer:
Short Sales. Short sales of the Company's securities evidence an expectation on the part of the seller that the securities will decline in value, and
therefore signal to the market that the seller has no confidence in the Company or its short-term prospects. In addition, short sales may reduce the
seller's incentive to improve the Company's performance.
For these reasons, no Insider may engage in short sales of the Company's securities. In addition, Section 16(c) of the Exchange Act prohibits
executive officers and directors from engaging in short sales (see below for a discussion of the obligations of Section 16 Individuals).
Options and Derivative Securities. A transaction in options is, in effect, a bet on the short-term movement of the Company's stock and therefore
creates the appearance that the Insider is trading based on inside information. Transactions in options also may focus the transacting person's
attention on short-term performance at the expense of the Company's long-term objectives.
Accordingly, no Insider may engage in transactions in puts, calls or other derivative securities based on the Company's securities, on an
exchange or in any other organized market.
Hedging Transactions. Certain forms of hedging or monetization transactions, such as zero-cost collars and forward sale contracts, allow a
stockholder to lock in much of the value of his or her stock holdings, often in exchange for all or part of the potential for upside appreciation in
the stock. These transactions allow the holder to continue to own the covered securities, but without the full risks and rewards of ownership.
When that occurs, the owner may no longer have the same objectives as the Company's other shareholders.

Therefore, no Insider may engage in any such transactions.
Gifts of Securities
Bona fide gifts of Company securities are considered sales of Company securities and subject to this Policy.
Bona fide gifts by a Section 16 Individual (as defined in Section 600) require pre-clearance as set forth in Section 600 prior to making any such
bona fide gift. A Section 16 Individual is prohibited from making any such bona fide gift during a quarterly or event specific blackout. Section
16 Individuals must report dispositions of bona fide gifts of Company securities on Form 4 before the end of the second business day following
the date of execution of the transaction.
Transactions Under Company Plans
Stock Option Exercises. This Policy does not apply to your exercise of an employee stock option or settled stock appreciation right, or to the
exercise (without a sale) of a tax withholding right pursuant to which you elect to have the Company withhold shares subject to an option to
satisfy tax withholding requirements.
This Policy does apply, however, to (i) any sale of stock as part of a broker-assisted cashless exercise of an option, (ii) any sale of Company
stock issued on exercise of an option, or (iii) any other market sale for the purpose of generating the cash needed to pay the exercise price of, or
any tax withholding obligations related to the exercise of, an option.
EFSC Incentive Savings Plan. This Policy applies to transactions effected through the EFSC Stock Fund which is an investment option in the
EFSC Incentive Savings Plan (the “401(k) Plan”) as follows:
•
This Policy does not apply to purchases of Company stock in the EFSC Stock Fund resulting from your periodic contribution of money
pursuant to your payroll deduction election.
•
This Policy does apply, however, to certain elections you may make under the 401(k) Plan, including:
◦
An election to increase or decrease the percentage of your periodic contributions that will be allocated to the EFSC Stock Fund,
or
◦
An election to sell Company stock or make an intra-plan transfer of an existing account balance into or out of the EFSC Stock
Fund, or
◦
An election to borrow money against your 401(k) Plan funds invested in the EFSC Stock Fund if the loan would result in a
liquidation of some or all of your Company stock balance, and to the repayment of a plan loan if some or all of the payments
would be allocated to the Company stock.
Employee Stock Purchase Plan. The purchase of shares of EFSC stock resulting from contributions to the Company’s ESPP is not subject to the
restrictions set forth in this Policy.
This Policy does, however, apply to your election to participate, cease participation or otherwise alter your participation in the ESPP, and applies
to the sale of any shares you acquire pursuant to the ESPP.
Trading in Other Securities

No Insider may place purchase or sell orders or recommend that another person place a purchase or sell order in the securities of another
company, including our customers or suppliers, if the person learns of material nonpublic information about the other company obtained in the
course of his/her involvement with the Company.
Consequences of an Insider Trading Violation
The consequences of an insider trading violation can be severe, as detailed below:
•
Liability for Insider Trading. Insiders (or their tippees) who willfully trade on inside information are subject to the following penalties:
◦
a civil penalty of up to three times the profit gained or loss avoided;
◦
a criminal fine of up to $5,000,000 (or $25,000,000 in the case of an entity) (no matter how small the profit); and
◦
a jail term of up to twenty years.
•
Liability for Tipping.
◦
An Insider who communicates or “tips,” insider information to a person who then trades is subject to the same penalties as the
tippee, even if the Insider did not trade and did not profit from the tippee's trading. The Securities and Exchange Commission
(“SEC”) has imposed large monetary penalties for disclosures of this kind.
◦
An Insider who gifts Company securities may be subject to liability if he or she was aware of material nonpublic information
and knew, or was reckless in not knowing, that the recipient would sell the Company’s securities prior to the public disclosure of
such material nonpublic information.
•
Control Person Liability. The SEC can seek substantial civil penalties from any person who, at the time of an insider trading violation,
"directly or indirectly controlled the person who committed such violation," which would apply to the Company and /or management
and supervisory personnel of the Company. If control persons fail to take appropriate steps to prevent illegal insider trading, such control
persons are subject to the following penalties:
◦
significant civil penalties not to exceed the greater of $1,000,000 or three times the profit gained or loss avoided as a result of
the violation;
◦
a criminal fine of up to $5,000,000; and
◦
a jail term of up to twenty years.
•
Possible Disciplinary Actions.
◦
Employee Insiders who violate this Policy, or any applicable laws and regulations, will be subject to disciplinary action, which
may include ineligibility for future participation in our equity incentive plans or termination of employment.
400. Explanations
What is “Material” Information?
The materiality of information depends upon the circumstances. Information is considered “material” if there is a substantial likelihood that a
reasonable investor would consider it important in making a decision to buy, sell or hold a security or where the fact is likely to have a
significant effect on the market price of the security. Material information can be positive or negative and can relate to virtually any aspect of a
company’s business or to any type of security, debt or equity.

Some examples of material information include:
•
unpublished financial results
•
projections of future earnings or losses
•
significant changes in corporate objectives or personnel
•
changes in dividend policies
•
new equity or debt offerings
•
news of a significant acquisition or disposition of assets
•
news of a pending or proposed merger, acquisition or other strategic alliance (even if preliminary in nature);
•
financial liquidity problems;
•
cybersecurity risks and incidents, including vulnerabilities and breaches;
•
significant asset write-downs (or write-ups)
•
a change in the Company's accountants or accounting
•
stock splits; and
•
developments regarding significant litigation or regulatory examinations.
The above list is only illustrative; many other types of information may be considered “material,” depending on the circumstances. Material
information is not limited to historical facts, but may also include projections and forecasts and information derived from analysis of
information. The materiality of particular information is subject to reassessment on a regular basis.
If securities transactions ever become the subject of scrutiny, they are likely to be viewed after-the-fact with the benefit of hindsight. As a result,
before engaging in any transaction an Insider should carefully consider how his or her transaction may be construed in the bright light of
hindsight. Again, in the event of any questions or uncertainties about this Policy, please consult the Company’s Insider Trading
Compliance Officer or assume that the information is material and treat it as confidential.
What is “Nonpublic” Information?
Information is “nonpublic” if it is not available to the general public. The fact that information has been disclosed to a few members of the public
does not make it public for insider trading purposes. In order for information to be considered public, it must be widely disseminated in a manner
making it generally available to investors in the Company’s reports and filings with the SEC or through a widely circulated press release.
Even after a public announcement of material information or disclosure in filings with the SEC, a reasonable period of time must elapse in order
for the market to react to and for investors to absorb the information. Generally, one should allow approximately two full trading days following
filing or publication as a reasonable waiting period before such information is deemed to be public.
Nonpublic information may include, but is not limited to:
•
information available to employees or only to a select group of analysts, brokers or institutional investors;
•
information shared pursuant to a confidentiality or non-disclosure agreement;
•
undisclosed facts that are the subject of rumors, even if the rumors are widely circulated; and

•
information that has been entrusted to the Company on a confidential basis until a public announcement of the information has been
made and enough time has elapsed for the market to respond to the public announcement of the information (normally two trading days).
As with questions of materiality, if you are not sure whether information is considered public, you should either consult with the
Company’s Insider Trading Compliance Officer or assume that the information is nonpublic and treat it as confidential.
Who is a “Related Person?”
For purposes of this Policy, a Related Person includes your spouse, minor children and anyone else living in your household; partnerships in
which you are a general partner; trusts of which you are a trustee; and estates of which you are an executor. Although a person’s parent or sibling
may not be considered a Related Person (unless living in the same household), a parent or sibling may be a “tippee” for securities laws purposes.
See the discussion on the prohibition on “tipping”, above.
When are the “Blackout Periods?”
Quarterly Blackouts
The Company's announcement of its quarterly financial results almost always has the potential to have a material effect on the market for the
Company's securities. Therefore, in order to avoid even the appearance of trading while aware of material nonpublic information, Insiders who
are or may be expected to be aware of the Company's quarterly financial information and results, as well as other individuals designated by the
Insider Trading Compliance Officer from time to time, generally will not be pre-cleared to trade in the Company's securities during the following
periods:
Quarterly Blackout Period Begins: Fourteen (14) days prior to the end of the Company's fiscal quarter.
Quarterly Blackout Period Ends: At the close of trading on the NASDAQ Stock Exchange on the second full trading day (day on which the
stock market is open) following the Company's issuance of its earnings release for the quarter.
This period is referred to herein as the “Quarterly Blackout Period”.
Event-Specific Blackouts
In addition to the Quarterly Blackout Periods described above, from time to time, an event may occur that is material to the Company and is
known by only a few individuals inside the Company. If you are one of those individuals, or if it would appear to an outsider that you were likely
to have had access to information about the event, then you will not be allowed to trade in the Company's securities so long as the event remains
material and nonpublic. We refer to this as an “Event-Specific Blackout”.
Also, the Company may on occasion issue interim earnings guidance or other potentially material information by means of a press release, SEC
filing on Form 8-K or other means designed to achieve widespread dissemination of the information. You should anticipate that trades are
unlikely to be pre-cleared while the Company is in the process of assembling the information to be released and until the information has been
released and fully absorbed by the market.

The Company will notify you in the event that you are subject to an Event-Specific Blackout. If you request pre-clearance of a transaction in the
Company's securities during an Event-Specific Blackout to which you are subject, you will not be allowed to trade in the Company’s securities
until the Company notifies you that the Event-Specific Blackout period has expired.
If you are made aware of the existence of an Event-Specific Blackout you should not disclose the existence of the blackout to any other person.
Whether or not you are designated as being subject to an Event-Specific Blackout you still have the obligation not to trade while aware of
material nonpublic information.
500. Appointment of Insider Trading Compliance Officer
The Company has appointed the Chief Financial Officer as the Company’s Insider Trading Compliance Officer. The duties of the Insider Trading
Compliance Officer shall include, but not be limited to, the following:
•
Other than transactions made pursuant to an approved Rule 10b5-1 trading plan, pre-clearing all transactions involving the Company's
securities by those individuals that have been identified and informed by the Company in order to determine compliance with this Policy,
insider trading laws, Section 16 of the Exchange Act and Rule 144 promulgated under the Securities Act of 1933, as amended. This list
of persons will be amended from time to time as appropriate.
•
Assisting in the preparation and filing of Section 16 reports (Forms 3, 4 and 5) for all Section 16 Individuals (as defined below).
•
Serving as the designated recipient at the Company of copies of reports filed with the SEC by Section 16 Individuals under Section 16 of
the Exchange Act.
•
Periodically reminding all Section 16 Individuals regarding their obligations to report and quarterly reminders of the dates that the
trading window described herein begins and ends.
•
Performing periodic cross-checks of available materials, which may include Forms 3, 4 and 5, Forms 144, officer's and director's
questionnaires, and reports received from the Company's stock administrator and transfer agent, to determine trading activity by officers,
directors and others who have, or may have, access to inside information.
•
Circulating this Policy (and/or a summary thereof) to all employees, including Section 16 Individuals, on an annual basis, and providing
this Policy and other appropriate materials to new officers, directors and others who have, or may have, access to inside information.
•
Assisting the Company in implementation of this Policy.
•
Coordinating with Company counsel regarding compliance activities with respect to Rule 144 requirements and regarding changing
requirements and recommendations for compliance with Section 16 of the Exchange Act and insider trading laws to ensure that this
Policy is amended as necessary to comply with such requirements.
In connection with fulfilling the role of Insider Trading Compliance Officer, the Chief Financial Officer may utilize members of the Finance staff
to assist in these duties.
600. Special Additional Restrictions and Requirements for Section 16 Individuals, EB&T Directors and Certain Additional Designated
Company Employees
This Section 600 of the Company’s Insider Trading Policy imposes special additional trading restrictions and applies to transactions in Company
securities by Section 16 Individuals (defined below) (and, with regard to pre-clearance requirements only, also applies to certain other employees
that serve on the Strategy and/or Planning Groups (as defined below)).

The policies and procedures described in this section are in addition to the other requirements of this Policy.
“Section 16 Individuals” include: EFSC directors and, executive officers and certain other individuals (including the Chief Accounting Officer,
and officers serving as the head of a principal business unit, division or function or otherwise performing a policy making function) who are
designated as executive officers and/or Section 16 individuals annually (or as needed) by the EFSC Board of Directors as well as 10%
stockholders.
Reporting Requirements
Section 16 Individuals subject to reporting requirements under Section 16(a) of the Exchange Act are individually responsible for filings under
Section 16(a) of the Exchange Act and must file reports on (i) Form 3 within ten calendar days from the date the individual becomes an Insider,
unless the individual transacts in the Company’s securities prior to the end of the ten calendar day period, in which case the Form 3 must be filed
within two business days of the transaction; (ii) Form 4 within two business days of any acquisition or disposition of shares of the Company’s
securities ; and (iii) Form 5 within 45 calendar days after the end of the Company’s fiscal year for transactions made eligible for deferred
reporting on Form 5 by SEC rule, and those that should have been reported earlier on Form 4 (or a prior Form 5) but were not. In addition, in
connection with sales of the Company’s shares such persons are generally required to file with the SEC a notice on Form 144 at or prior to
entering the order for the transaction.
Trading Window for Section 16 Individuals
The “Trading Window” is closed during any period in which Section 16 Individuals have actual ‘inside information’ and during periods when
there is a presumption that inside information exists broadly among the directors and other officers. In addition to being subject to all of the other
limitations in this Policy, Section 16 Individuals are presumed to be aware of material nonpublic information, such as quarterly results, and
therefore may only buy or sell Company securities in the public market or make a bona fide gift of Company securities during the periods that
the Company is not in a Quarterly or Event-Specific Blackout, as described in Section 400.
Pre-Clearance
Section 16 Individuals, EB&T directors and members of the Company’s Strategy and Planning Groups must obtain pre-clearance from the
Insider Trading Compliance Officer (and, as to the Insider Trading Compliance Officer, from the Chief Executive Officer), before they or a
Related Person of a Section 16 Individual or member of the Strategy and/or Planning Groups, make(s) a gift or transfer, or purchase(s) or sell(s)
any Company securities, including any exercise of stock options. Pre-clearance is required for all bona fide gifts, purchases or sales, including
transfers between the EFSC Common Stock Fund and other investment options in the Company’s 401(k) Plan by a Section 16 Individual or a
member of the Strategy and/or Planning Groups. Requests for pre-clearance should be made to the Insider Trading Compliance Officer by email
to: trading@enterprisebank.com
Only the Insider Trading Compliance Officer (and, as to the Insider Trading Compliance Officer, the Chief Executive Officer) is authorized to
provide pre-clearance as required by this Policy.
Each proposed transaction will be evaluated to determine if it raises insider trading concerns or other concerns under the federal or state
securities laws and regulations. Any advice will relate solely to the

restraints imposed by law and will not constitute legal advice or advice regarding the investment aspects of any transaction. Pre-clearance will in
no way relieve any person of their own legal obligations under federal securities laws.
Pre-clearance of a transaction is valid only for a 48-hour period from when clearance is given. If the transaction order is not placed within that
48-hour period, pre-clearance of the transaction must be re-requested. If pre-clearance is denied, the fact of such denial must be kept confidential
by the person requesting such pre-clearance. None of the Company, the Insider Trading Compliance Officer, the Chief Executive Officer or the
Company’s other employees will have any liability for any delay in reviewing, or refusal of, a request for pre-clearance submitted pursuant to
this Policy. Notwithstanding any pre-clearance of a transaction, none of the Company, the Insider Trading Compliance Officer, the Chief
Executive Officer or the Company’s other employees assumes any liability for the legality or consequences of such transaction to the person
engaging in such transaction.
Pre-clearance is not required for purchases and sales of securities under a pre-cleared Rule 10b5-1 trading plan in accordance with the
procedures discussed below.
Prohibition on Margin Accounts and Pledges
Securities held in a margin account may be sold by the broker without the customer’s consent if the customer fails to meet a margin call.
Similarly, securities pledged (or hypothecated) as collateral for a loan may be sold in foreclosure if the borrower defaults on the loan. A margin
sale or foreclosure sale may occur at a time when the pledgor is aware of material nonpublic information or otherwise is not permitted to trade in
Company securities. As a result, pledges and holding securities in a margin account by Section 16 Individuals are subject to the following
limitations (the “Margin and Pledge Restrictions”):
1.
Non-management directors of EFSC are prohibited from holding Company securities in a margin account or pledging Company
securities as collateral for a loan from a person other than the Company or its subsidiaries.
2.
Company employees who are Section 16 Individuals are prohibited from holding Company securities in a margin account.
3.
Company employees who are Section 16 Individuals are also prohibited from pledging Company securities as collateral for a loan from
a person other than the Company without obtaining prior approval of the Insider Trading Compliance Officer. Further, the Insider
Trading Compliance Officer may not engage in such transactions without the approval of the Chief Executive Officer. The Chief
Executive Officer may not engage in such transactions without the approval of the Executive Committee of the EFSC Board of
Directors. The approval of the Insider Trading Compliance Officer, Chief Executive Officer, or Executive Committee, as applicable, may
be granted or withheld based on relevant factors determined in their respective discretion, including without limitation the apparent
ability of the employee to repay the loan without foreclosure of the Company securities. Any request for approval must be submitted to
the Insider Trading Compliance Officer, Chief Executive Officer, or Executive Committee, as applicable, at least two weeks prior to
consummating the pledge.
Persons subject to the Margin and Pledge Restrictions will have sixty (60) days to comply with respect to any margin accounts or pledge
arrangements existing on the effective date of the adoption of these restrictions.
Rule 10b5-1 Trading Plans

If any Section 16 Individual wishes to implement a trading plan under Exchange Act Rule 10b5-1, or modify an existing plan with respect to
amount, price or timing of the purchase or sale of securities under the plan, such person must first pre-clear the plan or any such modification of
an existing plan, as applicable, with the Insider Trading Compliance Officer (and, as to the Insider Trading Compliance Officer, the Chief
Executive Officer) by providing such individual with a copy of the proposed plan or the modification of an existing plan, as applicable. Any such
Section 16 Individual must wait to initiate any trades under the Rule 10b5-1 trading plan until the later of (i) 90 days after receipt of approval of
the plan, or the modification of an existing plan, and (ii) two business days following the Company’s filing of a Form 10-Q or 10-K covering the
financial reporting period in which the plan, or the modification of an existing plan, was approved, but no later than 120 days. As required by
Rule 10b5-1, the Section 16 Individual may enter into a trading plan (or modify an existing trading plan) only when such person is not in
possession of material nonpublic information. In addition, the Section 16 Individual may not enter into a trading plan (or modify an existing
trading plan) during a Blackout Period (see Section 400). If, at the time a Rule 10b5-1 trading plan or any modification of an existing plan is
presented for approval as detailed above, there exists material nonpublic information about the Company to which the Section 16 Individual may
have knowledge, any implementation of such plan or modification of an existing plan shall be delayed by the Section 16 Individual until such
information has been publicly disclosed.
Any Rule 10b5-1 trading plan of a Section 16 Individual must contain written representations from the Section 16 Individual certifying that he or
she (i) is not aware of material nonpublic information about the Company or its securities and (ii) is adopting or modifying the plan in good faith
and not as part of a plan or scheme to evade the prohibitions of Rule 10b-5 of the Exchange Act.
Transactions effected pursuant to a pre-cleared Rule 10b5-1 trading plan will not require further pre-clearance (as discussed above) at the time of
the transaction if the plan specifies the dates, prices and amounts of the contemplated trades, or establishes a formula for determining the dates,
prices and amounts. Notwithstanding the above, to the extent possible, although no pre-clearance is required, a Section 16 Individual should give
the Insider Trading Compliance Officer (or, as to the Insider Trading Compliance Officer, the Chief Executive Officer) advance notice of
upcoming transactions to be effected pursuant to a Rule 10b-5 trading plan, which will help EFSC assist such Section 16 Insider with their Rule
144 and Section 16 reporting obligations. - The individual’s broker as well as the Section 16 Individual must immediately notify the Insider
Trading Compliance Officer (or, as to the Insider Trading Compliance Officer, the Chief Executive Officer) upon the completion of such
transaction and should have duplicate confirmations of all such transactions sent to the Insider Trading Compliance Officer on their behalf.
Notwithstanding any preclearance of a Rule 10b5-1 trading plan, the Company, the Insider Trading Compliance Officer and its other employees
assume no liability for the consequences of any transaction made pursuant to such plan nor liability for any plan’s compliance or non-compliance
with applicable securities laws.
Any Insider, other than a Section 16 Individual, must wait to initiate any trades under a new Rule 10b5-1 trading plan, or any existing plan that
has been modified with respect to amount, price or timing of the purchase or sale of securities under the plan, until 30 days after the adoption or
modification of the plan.
Subject to certain limited exceptions described in Rule 10b5-1 of the Exchange Act, Insiders may not have more than one Rule 10b5-1 trading
plan outstanding for open market purchases or sales of any class of the Company’s securities during the same period. Additionally, Insiders may
not have more than one single-trade Rule 10b5-1 trading plan during any consecutive 12-month period.

The Insider Trading Compliance Officer will notify the EFSC Board of Directors annually of any Rule 10b5-1 trading plans executed during the
prior year.
Notwithstanding any pre-clearance of a Rule 10b5-1 trading plan, the Company, the Insider Trading Compliance Officer, and the Company’s
employees assume no liability for the consequences of any transaction made pursuant to a Rule 10b5-1 trading plan, nor liability for any Rule
10b5-1 trading plan’s compliance (or non-compliance) with applicable securities laws.
Short Swing Transactions
Section 16 Individuals must also comply with the reporting obligations and limitations on "short-swing" transactions set forth in the federal
securities laws. The practical effect of these provisions is that Section 16 Individuals who both purchase and sell the Company's securities within
a six-month period must refund all profits from the sale to the Company, whether or not they had knowledge of any material nonpublic
information. Under these provisions, and so long as certain other criteria are met, the receipt of options under the Company's option plans, the
exercise of such options, and the purchase of shares through the Savings and Investment Plan is not subject to these restrictions; however, the
sale of any such shares is subject to this six-month rule.
700. Duty to Report Violations Any Insider who violates this Policy or any federal or state laws governing insider trading or tipping, or knows
of any such violation by any other Insiders, must report the violation immediately to the Insider Trading Compliance Officer. Upon learning of
any such violation, the Insider Trading Compliance Officer will determine whether the Company should release any material nonpublic
information, or whether the Company should report the violation to the SEC or other appropriate governmental authority. The Company
prohibits retaliation against any employee who reports a concern in good faith or participates in good faith in an investigation related to a report.
800. Execution and Return of Certification of Compliance
After reading this Policy, upon request, all directors and employees must certify their understanding of and intent to comply with this Policy.
This certification may be done by an electronic acknowledgement.

EXHIBIT 21.1
SUBSIDIARIES OF THE REGISTRANT
Company
State of Organization
Enterprise Bank & Trust
Missouri
Enterprise Real Estate Mortgage Company, LLC
Missouri
Enterprise IHC, LLC
Missouri
Enterprise Portfolio Holdings, Inc.
Nevada

EXHIBIT 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in Registration Statement Nos. 333-136230, 333-148328, 333-152985, 333-183177, 333-192497,
333-215345, 333-226407, 333-258962 and 333-273380 on Form S-8, and 333-271165 on Form S-3 of our report dated February  28, 2025
relating to the consolidated financial statements of Enterprise Financial Services Corp and subsidiaries (the “Company”), and the effectiveness of
the Company’s internal control over financial reporting, appearing in this Annual Report on Form 10-K for the year ended December 31, 2024.
/s/ Deloitte & Touche LLP
St. Louis, Missouri
February 28, 2025

EXHIBIT 24.1
POWER OF ATTORNEY
The undersigned members of the Board of Directors and Executive Officers of Enterprise Financial Services Corp, a Delaware corporation (the
"Company") hereby appoint Keene S. Turner or James Lally as their Attorney-in-Fact for the purpose of signing the Company's Securities
Exchange Commission Form 10-K (and any amendments thereto) for the year ended December 31, 2024.
Signature
Title
Date
/s/ Michael A. DeCola
Chairman of the Board of Directors
February 28, 2025
Michael A. DeCola
/s/ Lyne B. Andrich
Director
February 28, 2025
Lyne B. Andrich
/s/ Michael E. Finn
Director
February 28, 2025
Michael E. Finn
/s/ Robert E. Guest, Jr.
Director
February 28, 2025
Robert E. Guest, Jr.
/s/ James M. Havel
Director
February 28, 2025
James M. Havel
/s/ Michael R. Holmes
Director
February 28, 2025
Michael R. Holmes
/s/ Nevada A. Kent, IV
Director
February 28, 2025
Nevada A. Kent, IV
/s/ Marcela Manjarrez
Director
February 28, 2025
Marcela Manjarrez
/s/ Stephen P. Marsh
Director
February 28, 2025
Stephen P. Marsh
/s/ Daniel A. Rodrigues
Director
February 28, 2025
Daniel A. Rodrigues
/s/ Richard M. Sanborn
Director
February 28, 2025
Richard M. Sanborn
/s/ Eloise E. Schmitz
Director
February 28, 2025
Eloise E. Schmitz
/s/ Sandra A. Van Trease
Director
February 28, 2025
Sandra A. Van Trease
/s/ Lina A. Young
Director
February 28, 2025
Lina A. Young

EXHIBIT 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
I, James B. Lally, certify that:
1.
I have reviewed this annual report on Form 10-K of Enterprise Financial Services Corp;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this
report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-
15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision,
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d)
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal
quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the
registrant’s internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely
to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over
financial reporting.
By:
/s/ James B. Lally
Date: February 28, 2025
James B. Lally
 
Chief Executive Officer
 

EXHIBIT 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
I, Keene S. Turner, certify that:
1.
I have reviewed this annual report on Form 10-K of Enterprise Financial Services Corp;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this
report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-
15(f)) for the registrant and have;
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision,
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d)
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal
quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the
registrant’s internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely
to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over
financial reporting.
By:
/s/ Keene S. Turner
Date: February 28, 2025
Keene S. Turner
 
Chief Financial Officer
 

EXHIBIT 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Enterprise Financial Services Corp (the “Company”) on Form 10-K for the period ended December 31, 2024 as filed
with the Securities and Exchange Commission (the “Report”), I, James B. Lally, Chief Executive Officer of the Company, certify to the best of my knowledge
and belief, pursuant to 18 U.S.C. § 1350, as enacted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and the information contained in the Report
fairly presents, in all material respects, the financial condition and results of operations of the Company.
/s/ James B. Lally
James B. Lally
Chief Executive Officer
February 28, 2025

EXHIBIT 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Enterprise Financial Services Corp (the “Company”) on Form 10-K for the period ended December 31, 2024 as filed
with the Securities and Exchange Commission (the “Report”), I, Keene S. Turner, Chief Financial Officer of the Company, certify to the best of my knowledge
and belief, pursuant to 18 U.S.C. § 1350, as enacted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and the information contained in the Report
fairly presents, in all material respects, the financial condition and results of operations of the Company.
/s/ Keene S. Turner
Keene S. Turner
Chief Financial Officer
February 28, 2025