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Acquisition | 9 Months Ended
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Sep. 30, 2021
Business Combinations [Abstract] |
Acquisition | ACQUISITIONThe acquisition noted below has been accounted for as a business combination using the acquisition method of accounting which requires assets acquired and liabilities assumed to be recognized at fair value as of the acquisition date. Goodwill arising from the acquisitions consist largely of the synergies and economies of scale expected from combining the operations into Enterprise. None of the goodwill recognized is expected to be deductible for income tax purposes. Acquisition of First Choice Bancorp On July 21, 2021, the Company closed its acquisition of 100% of FCBP and its wholly-owned subsidiary, FCB, which operated eight full-service branches in California. FCBP shareholders received 0.6603 shares of EFSC common stock for each FCBP common share and cash in lieu of any fractional shares. In connection with the merger, Enterprise issued approximately 7.8 million shares of EFSC Common Stock valued at $44.01 per share, which was the closing price of Enterprise common stock on July 21, 2021. The value of the transaction consideration was approximately $346 million, which includes approximately $2.1 million payable to holders of FCBP stock options. For the three and nine months ended September 30, 2021, the Company recognized $14.7 million and $16.6 million, respectively, of merger-related costs recorded in noninterest expense in the statement of operations related to the FCBP acquisition. The following tables present the assets acquired and liabilities assumed. The consideration exchanged, assets acquired and liabilities assumed of FCBP were recorded at estimated fair value on the date of acquisition. Fair values are considered preliminary until final fair values are determined, or the measurement period has passed, which is no later than one year from the date of acquisition.
(in thousands) | As Recorded by First Choice |  | Adjustments |  | As Recorded by EFSC
Assets acquired: |  |  |  |  |
Cash and cash equivalents | $ | 214,794 |  |  | $ | — |  |  | $ | 214,794 |
Securities | 34,533 |  |  | (44) |  | (a) | 34,489 |
Loans | 1,937,635 |  |  | 5,508 |  | (b) | 1,943,143 |
Allowance | (19,626) |  |  | 12,620 |  | (b) | (7,006) |
Other investments | 19,178 |  |  | 138 |  | (c) | 19,316 |
Fixed assets | 1,869 |  |  | (820) |  | (c) | 1,049 |
Accrued interest receivable | 7,131 |  |  | (242) |  | (c) | 6,889 |
Goodwill | 73,425 |  |  | (73,425) |  | (d) | — |
Intangible assets | 4,517 |  |  | 375 |  | (e) | 4,892 |
Deferred tax assets | 7,558 |  |  | (2,440) |  | (c) | 5,118 |
Other assets | 23,024 |  |  | 2,103 |  | (c) | 25,127 |
Total assets acquired | $ | 2,304,038 |  |  | $ | (56,227) |  |  | $ | 2,247,811 |
Liabilities assumed: |  |  |  |  |
Deposits | $ | 1,840,716 |  |  | $ | (287) |  | (c) | $ | 1,840,429 |
FHLB advances | 160,000 |  |  | — |  |  | 160,000 |
Accrued interest payable | 124 |  |  | — |  |  | 124 |
Other liabilities | 8,464 |  |  | (2,160) |  | (c) | 6,304 |
Total liabilities assumed | $ | 2,009,304 |  |  | $ | (2,447) |  |  | $ | 2,006,857 |
Net assets acquired | $ | 294,734 |  |  | $ | (53,780) |  |  | $ | 240,954 |
Consideration paid: |  |  |  |  |
Cash |  |  |  |  | $ | 2,152 |
Common stock 1 |  |  |  |  | 343,650 |
Total consideration paid |  |  |  |  | $ | 345,802 |
Goodwill |  |  |  |  | $ | 104,848 |
1 Common stock consideration was $342,280, net of $1,370 for shares withheld on the settlement of share-based awards of FCBP employees. (a)Fair value adjustments based on the Company’s evaluation of the acquired securities portfolio. (b)Fair value adjustments based on the Company’s evaluation of the acquired loan portfolio, write-off of net deferred loan costs and elimination of the allowance for loan losses recorded by FCBP. (c)Other miscellaneous fair value adjustments. (d)Adjustment to eliminate goodwill. (e)Eliminate acquired intangibles and record the core deposit intangible asset on the acquired core deposit accounts. Amount to be amortized using a sum-of-years digits method over a useful life of 10 years. The following table provides the unaudited pro forma information for the results of operations for the nine months ended September 30, 2021 and 2020, as if the acquisition had occurred on January 1, 2020. The pro forma results combine the historical results of FCBP with the Company’s Consolidated Statements of Income, adjusted for the impact of the application of the acquisition method of accounting including amortization and accretion of fair value adjustments. The pro forma results have been prepared for comparative purposes only and are not necessarily indicative of the results that would have been obtained had the acquisition actually occurred on January 1, 2020. No assumptions have been applied to the pro forma results of operations regarding possible revenue enhancements, expense efficiencies or asset dispositions. Only the acquisition-related expenses that have been incurred as of September 30, 2021 are included in net income in the table below.
|  |  | Nine months ended September 30,
(in thousands, except per share data) |  |  |  |  | 2021 |  | 2020
Total revenues (net interest income plus noninterest income) |  |  |  |  | $ | 363,426 |  |  | $ | 296,148 |
Net income |  |  |  |  | 135,920 |  |  | 28,776 |
Diluted earnings per common share |  |  |  |  | 3.49 |  |  | 0.84 |
For the three and nine months ended September 30, 2021, total revenue and pre-tax net income from FCBP of $18.1 million and $11.2 million (excluding the provision for credit losses of $25.4 million on the acquired loan portfolio and unfunded loan commitments) were included in the Company’s consolidated results.

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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