Enterprise Financial Services Corp. reported net income of $11.0 million for the quarter ended June 30, 2013, an increase of 26% compared to net income of $8.8 million for the prior year period. Net income per diluted share was $0.58 for the second quarter of 2013, an increase of 32% compared to $0.44 per diluted share for the second quarter of 2012.
Peter Benoist, President and CEO, commented, “Second quarter results reflect continuing favorable performance trends. Earnings per share rose 32% over the prior year quarter, following a 71% year-over-year gain in the first quarter. At midyear, the Company is generating strong profitability, producing an annualized return on assets of 1.35% and return on common equity of 17.34%.”
“Earnings gains in the quarter were driven by further improvement in asset quality, resulting in a $4.3 million net loan loss provision benefit on our non-covered loans“, continued Benoist. “Our nonperforming asset and nonperforming loan ratios have been reduced to roughly their levels in 2008 and, while we may still see some volatility in these metrics, the general trends remain favorable. Our risk assessment processes have led to commensurate reductions in loan loss reserves, although reserves continue to cover more than 100% of our nonperforming loans.”
“While price competition for quality C&I loans remains intense, we’re adhering to our pricing discipline. We’re pleased that we were able to maintain our core net interest margin in the second quarter and still produce growth in C&I loans consistent with our mid-single digit annual growth expectation. We’ll continue to trade off volume for profitability as appropriate to create shareholder value.”
Benoist added, “Covered assets again contributed materially to our earnings. Net revenues from FDIC loss share assets totaled $6.6 million in the second quarter, bringing the total net revenue contribution life to date from those assets to more than $82 million.”