8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

Current report pursuant to the

Section 13 or 15(d) of the

Securities and Exchange Act of 1934

July 21, 2003

Date of Report (Date of earliest event reported)

ENTERPRISE FINANCIAL SERVICES CORP

(Exact Name of Registrant as Specified in its Charter)

Delaware	001-15373	43-1706259
(State of Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

150 N. Meramec, St Louis, Missouri	63105
(Address of Principal Executive Offices)	(Zip Code)

(314) 725-5500

(Registrant’s Telephone Number)

ITEM 7. Financial Statements and Exhibits

(c) Exhibits

The following exhibit is furnished pursuant to Item 12 (reported herein under the Item 9 caption in accordance with the guidance provided in SEC Release Nos. 33-8216; 34-475831, is not to be considered “filed” under the Securities Exchange Act of 1934, as amended (“Exchange Act”), and shall not be incorporated by reference into any of Enterprise Financial Services Corp’s (“Registrant”) previous or future filings under the Securities Act of 1933, as amended, or the Exchange Act.

Exhibit No.	Description
99.1	Earnings Release for Quarter Ended 6/30/03

ITEM 9. INFORMATION FURNISHED UNDER ITEM 12 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On July 21, 2003, Registrant issued an earnings release related to its quarterly period ended June 30, 2003 and the text of that release, as required by Item 12 of Form 8-K, is attached hereto as Exhibit 99.1.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereto duly authorized.

Date: July 22, 2003

ENTERPRISE FINANCIAL SERVICES CORP

/s/    KEVIN C. EICHNER        

Kevin C. Eichner

Chief Executive Officer

INDEX TO EXHIBITS

Exhibit No.	Description
99.1	Press Release dated July 21, 2003

EX-99.1

1. FOR IMMEDIATE RELEASE

For more information, contact:

Kevin Eichner (314) 725 5500

Frank Sanfilippo (314) 725 5500

Melissa Sturges (816) 235 7733

ENTERPRISE FINANCIAL REPORTS 58.3% INCREASE IN EARNINGS PER SHARE OVER PREVIOUS YEAR

Strong Trust Company Growth. Noninterest income grows 120.2%

St. Louis, July 21, 2003—Enterprise Financial Services Corp. (OTCBB: EFSC), the parent company of Enterprise Bank and Enterprise Trust reported second quarter net income of $2.6 million or $0.26 per fully diluted share and $3.7 million or $0.38 per fully diluted share for the six months ended June 30, 2003. The reported earnings per fully diluted share for the six months ended June 30, 2003 represent a 58.3% increase over the same period in 2002.

“We are particularly pleased with the performance of our noninterest income generators and with our ability to hold margins in our core banking business in this environment,” said Kevin Eichner, President and CEO of Enterprise Financial.

Portfolio loans grew by 8.2% or $56 million since December 31, 2002 and ended the quarter at $736 million. This growth was funded in part by increases of $32 million or 4.4% in deposits. Net interest income for the six months ended June 30, 2003 was $16.2 million; a $1.2 million or 8.3% increase over the same period last year. During the same period, the net interest rate margin increased to 4.07% from 4.04% in the same period last year primarily due to a better overall liabilities mix and favorable repricing of core deposits.

Total noninterest income grew by $3,532,000 for the six months ended June 30, 2003 versus the same period in 2002. This increase was generated from a $3,088,000 gain on the sale of three branches in April less a $150,000 write-off of related goodwill, increases in gains on the sale of mortgage loans, service charges, and securities gains. Heavy refinance volume in the home loan category continues to produce record gains on the sale of mortgage loans. Expanded services provided to Enterprise Financial clients and increased deposit accounts drove the service charge gains.

Trust and financial advisory performance was also strong in the six months ended June 30, 2003, generating fee income of $1,260,000. Enterprise Trust has again been named one of the fastest growing trust companies in the U.S. over the past three years according to Trust Report.

Provision for loan losses was $2,093,000 in the six months ended June 30, 2003 compared to $1,120,000 for the same period 2002. This increase reflects management’s cautionary view of the economic environment as the company continues its strong loan growth. The company also realized net charge-offs totaling $1,154,000 (versus $190,000 in the same period one year ago), due almost entirely to one problem loan relationship, which has now been largely resolved. The allowance for loan losses of $9.5 million at June 30, 2003 represents 1.30% of ending portfolio loans. This same ratio was 1.27% at December 31, 2002. Enterprise’s loan loss experience continues to compare favorably with peer institutions.

Expense ratios continued to improve as reduced staffing levels, productivity increases, and business process improvements were implemented. The efficiency ratio improved from 72.81% in the six months ended June 30, 2002 to 64.57% in the same period for 2003.

“Our focus on serving privately held businesses through our integrated approach to commercial banking and wealth creation services is unique in our markets and gaining greater acceptance every day. While this economy continues to challenge us, we are more confident than ever that we have a winning strategy being well executed by our team,” said CEO Eichner.

Enterprise Financial operates commercial banking and wealth management businesses in metropolitan St. Louis and Kansas City, Mo., with a primary focus on serving the needs of privately held businesses, their owners and other success-minded individuals.

Please refer to Enterprise Financial’s consolidated balance sheets as of June 30, 2003 and December 31, 2002 and consolidated statements of operations for the three and six months ended June 30, 2003 and 2002 attached for more details.

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Readers should note that in addition to the historical information contained herein, this press release may contain forward-looking statements which are inherently subject to risks and uncertainties that could cause actual results to differ materially from those contemplated from such statements. Factors that could cause or contribute to such differences include, but are not limited to, burdens imposed by federal and state regulations of banks, credit risk, exposure to local economic conditions, risks associated with rapid increase or decrease in prevailing interest rates and competition from banks and other financial institutions, as well as those in Enterprise Financial’s 2002 Annual Report on Form 10-K.

ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES

Consolidated Balance Sheets (unaudited)

(Dollars in thousands, except per share data)

	June 30, 2003		December 31, 2002
Assets
Cash and due from banks	$	34,750	$	39,052
Federal funds sold		19,374		33,367
Interest-bearing deposits		409		66
Investments in debt and equity securities:
Available for sale, at estimated fair value		57,441		66,619
Held to maturity, at amortized cost (estimated fair value of $11 at June 30, 2003 and $13 at December 31, 2002)		11		13
Total investments in debt and equity securities		57,452		66,632
Loans held for sale		5,088		6,991
Loans, less unearned loan fees		735,733		679,799
Less allowance for loan losses		9,539		8,600
Loans, net		726,194		671,199
Other real estate owned		345		125
Fixed assets, net		7,051		7,686
Accrued interest receivable		3,266		3,459
Goodwill		1,938		2,088
Assets held for sale		—		36,401
Prepaid expenses and other assets		10,417		9,721
Total assets	$	866,284	$	876,787
Liabilities and Shareholders’ Equity
Deposits:
Demand	$	161,499	$	155,597
Interest-bearing transaction accounts		49,765		59,058
Money market accounts		347,457		341,590
Savings		4,399		3,421
Certificates of deposit:
$100,000 and over		138,272		105,030
Other		46,622		51,618
Total deposits		748,014		716,314
Guaranteed preferred beneficial interests in subordinated debentures		15,000		15,000
Federal Home Loan Bank advances		29,108		29,464
Notes payable and other borrowings		2,359		2,359
Accrued interest payable		1,137		1,264
Liabilities held for sale		—		50,054
Accounts payable and accrued expenses		7,545		3,522
Total liabilities		803,163		817,977
Shareholders’ equity:
Common stock, $.01 par value; authorized 20,000,000 shares; issued and outstanding 9,565,123 shares at June 30, 2003 and 9,497,794 shares at December 31, 2002		96		95
Surplus		39,209		38,401
Retained earnings		22,025		18,674
Accumulated other comprehensive income		1,791		1,640
Total shareholders’ equity		63,121		58,810
Total liabilities and shareholders’ equity	$	866,284	$	876,787

ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES

Consolidated Statements of Operations (unaudited)

(Dollars in thousands, except per share data)

	Three months ended June 30,				Six months ended June 30,
	2003		2002		2003		2002
Interest income:
Interest and fees on loans	$	10,305	$	10,964	$	20,673	$	21,426
Interest on debt and equity securities:
Taxable		421		373		889		818
Nontaxable		4		—		5		1
Interest on federal funds sold		48		35		86		127
Interest on interest-bearing deposits		—		5		—		23
Dividends on equity securities		19		15		34		27
Total interest income		10,797		11,392		21,687		22,422
Interest expense:
Interest-bearing transaction accounts		49		69		101		137
Money market accounts		885		1,212		1,812		2,487
Savings		3		22		18		43
Certificates of deposit:
$100,000 and over		741		789		1,409		1,619
Other		377		1,062		941		2,273
Guaranteed preferred beneficial interests in subordinated debentures		309		263		617		521
Federal Home Loan Bank borrowings		312		178		603		362
Notes payable and other borrowings		19		47		29		63
Total interest expense		2,695		3,642		5,530		7,505
Net interest income		8,102		7,750		16,157		14,917
Provision for loan losses		1,094		530		2,093		1,120
Net interest income after provision for loan losses		7,008		7,220		14,064		13,797
Noninterest income:
Service charges on deposit accounts		406		449		893		861
Trust and financial advisory income		670		540		1,260		1,169
Other service charges and fee income		91		83		187		174
Gain on sale of mortgage loans		586		285		1,114		645
Gain on sale of securities		—		—		78		—
Gain on sale of branches		2,938		—		2,938		—
Recoveries and income from Merchant Banc investments		—		89		—		89
Total noninterest income		4,691		1,446		6,470		2,938
Noninterest expense:
Salaries		4,040		3,352		7,803		6,813
Payroll taxes and employee benefits		635		651		1,349		1,322
Occupancy		499		460		975		918
Furniture and equipment		233		255		454		507
Data processing		270		260		512		512
Other		1,900		1,389		3,517		2,927
Total noninterest expense		7,577		6,367		14,610		12,999
Income before income tax expense		4,122		2,299		5,924		3,736
Income tax expense		1,524		850		2,191		1,415
Net income	$	2,598	$	1,449	$	3,733	$	2,321
Per share amounts
Basic earnings per share	$	0.27	$	0.15	$	0.39	$	0.25
Basic weighted average common shares outstanding		9,560,529		9,399,560		9,541,552		9,349,433
Diluted earnings per share	$	0.26	$	0.15	$	0.38	$	0.24
Diluted weighted average common shares outstanding		9,892,558		9,575,650		9,855,507		9,576,225