Exhibit 99.1
FOR IMMEDIATE RELEASE
| | | |
MEDIA CONTACT: | | Sue Atkinson, 615-320-7532 |
FINANCIAL CONTACT: | | Harold Carpenter, 615-744-3742 |
WEBSITE: | | www.pnfp.com |
PINNACLE FINANCIAL REPORTS RETURN
TO PROFITABILITY IN THIRD QUARTER 2010
NASHVILLE, Tenn., Oct. 19, 2010 — Pinnacle Financial Partners, Inc. (Nasdaq/NGS: PNFP) today reported its third quarter results. Net income per fully diluted common share available to common stockholders was $0.02 for the quarter ended Sept. 30, 2010, compared to net loss per fully diluted common share available to common stockholders for the quarter ended Sept. 30, 2009, of $0.15. Pinnacle also reported a net loss per fully diluted common share available to common stockholders of $1.00 for the nine months ended Sept. 30, 2010, compared to a net loss per fully diluted common share available to common stockholders of $1.39 for the nine months ended Sept. 30, 2009.
“We are very pleased with the progress we made on a number of credit measures, including reductions in nonperforming assets and potential problem loans. The firm achieved a significant reduction in net charge-offs and continued to decrease exposure to construction and land development loans, both key priorities for our firm,” said M. Terry Turner, Pinnacle’s president and chief executive officer. “These achievements have allowed us to report quarterly net income for the first time this year.”
Aggressively Dealing with Problem Loans
| | • | | Reduced exposure to construction and land development loans from $411.5 million at June 30, 2010, to $359.7 million at Sept. 30, 2010, a decrease of 12.6 percent |
| | • | | $30.4 million in foreclosures during the third quarter |
| | • | | $43.1 million in nonperforming asset resolutions during the third quarter. Year to date resolutions of $145.5 million through Sept. 30, 2010 |
| | • | | Nonperforming loan inflows decreased from $71.2 in the second quarter of 2010 to $34.0 million during the third quarter of 2010 |
Expanding the Core Earnings Capacity of the Firm
| | • | | Continued growth in core deposits of 5.2 percent during the third quarter and 30.5 percent from Sept. 30, 2009. Average balances of noninterest bearing deposit accounts were $534 million in the third quarter of 2010, an increase of 5.9 percent over the prior quarter average balances. |
| | • | | Net interest margin increased from 3.05 percent for the quarter ended Sept. 30, 2009, to 3.23 percent for the quarter ended Sept. 30, 2010, which was the same as the net interest margin for the quarter ended June 30, 2010. |
| | • | | Net interest income increased by 4.4 percent between the third quarter of 2010 and third quarter of 2009. |
| | • | | Fee income was $8.59 million in third quarter of 2010, compared to $10.57 million in the second quarter of 2010 and $7.74 million in the third quarter of 2009. Excluding securities gains of $2.26 million in the second quarter of 2010, fee income increased from $8.31 million in the second quarter of 2010 to $8.59 million in the third quarter of 2010. |
“Pinnacle’s core funding growth, which increased 31 percent year-over-year, has been extraordinary. We believe exchanging $786 million in brokered and other non-core deposits for lower cost core deposits in the past 12 months validates our strength in our markets,” Turner said.
THIRD QUARTER 2010 HIGHLIGHTS:
| | • | | At Sept. 30, 2010, and Dec. 31, 2009, Pinnacle’s ratio of tangible common stockholders’ equity to tangible assets was 7.2 percent and 7.3 percent, respectively. Pinnacle’s tangible book value per common share was $10.12 at Sept. 30, 2010, compared to $10.71 at Dec. 31, 2009. Book value per common share was $17.61 and $18.41 at Sept. 30, 2010, and Dec. 31, 2009, respectively. |
| | • | | At Sept. 30, 2010, Pinnacle Financial’s total risk-based capital ratio was 15.1 percent, compared to 14.8 percent at Dec. 31, 2009. |
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| | • | | Balance sheet and liquidity |
| | • | | Total deposits at Sept. 30, 2010, were $3.83 billion, up $5.73 million from $3.82 billion at Sept. 30, 2009, but down from the $3.85 billion reported at June 30, 2010. |
| | • | | Core deposits amounted to $2.93 billion at Sept. 30, 2010, an increase of 30.5 percent from the $2.24 billion at Sept. 30, 2009. Core deposits also increased by an annualized growth rate of 20.7 percent during the third quarter. |
| | • | | Loans at Sept. 30, 2010, were $3.25 billion, down from $3.61 billion at Sept. 30, 2009, and $3.56 billion at Dec. 31, 2009. |
| | • | | Revenue for the quarter ended Sept. 30, 2010, amounted to $44.65 million, compared to $42.29 million for the same quarter of last year, an increase of 5.6 percent. |
| | • | | Net income available to common stockholders for the third quarter of 2010 was $549,000, compared to the prior year’s third quarter net loss available to common stockholders of $4.85 million and second quarter 2010 net loss available to common stockholders of $27.87 million. |
| | • | | Net charge-offs were $7.35 million for the three months ended Sept. 30, 2010, compared to $5.23 million for the three months ended Sept. 30, 2009, and $33.46 million for the second quarter of 2010. |
| | • | | Allowance for loan losses represented 2.60 percent of total loans at Sept. 30, 2010, compared to 2.61 percent at June 30, 2010, and 2.30 percent at Sept. 30, 2009. |
| | • | | Nonperforming loans plus other real estate were 4.60 percent of total loans plus other real estate at Sept. 30, 2010, compared to 4.77 percent at June 30, 2010, and 4.29 percent at Dec. 31, 2009. |
| | • | | Past due loans over 30 days, excluding nonperforming loans, were 0.67 percent of total loans at Sept. 30, 2010, compared to 0.66 percent at June 30, 2010, and 0.46 percent at Dec. 31, 2009. |
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“Although Pinnacle’s loan growth mirrors the industry’s weak loan demand, over time we believe our Tennessee markets will outperform the rest of the country for business expansions, corporate relocations and job growth,” Turner said. “Recent expansion and relocation announcements included additions in the tourism, hospitality and automotive manufacturing sectors. Recent unemployment statistics for both Nashville and Knoxville reflect improvement from the highs experienced during the second quarter of last year. Improving employment prospects in our target markets should help to foster increased loan demand.”
The following is a summary of the activity in various nonperforming asset and restructured accruing loan categories for the quarter ended Sept. 30, 2010:
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Payments, | | | | | | | | | | | | |
| | | Balances | | | Sales and | | | | | | | | | | | Balances | |
| (in thousands) | | June 30, 2010 | | | Reductions | | | Transfers | | | Inflows | | | Sept. 30, 2010 | |
| Restructured accruing loans: | | | | | | | | | | | | | | | | | | | | |
| Residential construction and development | | $ | 223 | | | $ | (223 | ) | | $ | — | | | $ | — | | | $ | — | |
| Other | | | 10,638 | | | | (10 | ) | | | — | | | | 2,840 | | | | 13,468 | |
| | | | | | | | | | | | | | | | |
| Totals | | | 10,861 | | | | (233 | ) | | | — | | | | 2,840 | | | | 13,468 | |
| | | | | | | | | | | | | | | | |
| Nonperforming loans: | | | | | | | | | | | | | | | | | | | | |
| Residential construction and development | | | 40,108 | | | | (5,105 | ) | | | (11,415 | ) | | | 6,308 | | | | 29,896 | |
| Other | | | 78,223 | | | | (13,662 | ) | | | (19,027 | ) | | | 27,697 | | | | 73,231 | |
| | | | | | | | | | | | | | | | |
| Totals | | | 118,331 | | | | (18,767 | ) | | | (30,442 | ) | | | 34,005 | | | | 103,127 | |
| | | | | | | | | | | | | | | | |
| Other real estate: | | | | | | | | | | | | | | | | | | | | |
| Residential construction and development | | | 29,324 | | | | (7,483 | ) | | | 11,415 | | | | — | | | | 33,256 | |
| Other | | | 13,292 | | | | (16,865 | ) | | | 19,027 | | | | — | | | | 15,454 | |
| | | | | | | | | | | | | | | | |
| Totals | | | 42,616 | | | | (24,348 | ) | | | 30,442 | | | | — | | | | 48,710 | |
| | | | | | | | | | | | | | | | |
| Total nonperforming assets and restructured accruing loans | | $ | 171,808 | | | $ | (43,348 | ) | | $ | — | | | $ | 36,845 | | | $ | 165,305 | |
| | | | | | | | | | | | | | | | |
REVENUE
| | • | | Net interest income for the third quarter of 2010 was $36.06 million, compared to $34.55 million for the same quarter last year, an increase of 4.4 percent. |
| | • | | Net interest margin for the third quarter of 2010 was 3.23 percent, compared to 3.05 percent for the same period last year. |
| | • | | Noninterest income for the third quarter of 2010 and 2009 was $8.59 million and $7.74 million, respectively. |
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“Given the level of liquidity we maintained in the third quarter as a result of continued growth in core deposits, we are pleased with our margin performance during the third quarter,” said Harold R. Carpenter, Pinnacle’s chief financial officer. “Our goal is gradual reduction in liquidity as well as capitalizing on continued deposit repricing over the next few quarters, both of which should benefit our margins and net interest income.”
The increase in net interest income was primarily attributable to better yields on loans as the impact of interest reversals on new nonaccruing loans was less in the third quarter of 2010 compared to the second quarter, as well as continued growth in less expensive funding sources. The continued funding shift from time deposits to money market accounts contributed to the increase in net interest income during the third quarter of 2010 compared to the same quarter last year.
Excluding securities gains of $2.26 million in the second quarter of 2010, third quarter 2010 fee income was approximately 3.4 percent higher than the second quarter of 2010 primarily due to increased mortgage originations and the resulting gains on the sales of those loans into the secondary markets.
NONINTEREST EXPENSE
| | • | | Noninterest expense for the quarter ended Sept. 30, 2010, was $37.77 million, compared to $36.49 million in the second quarter of 2010 and $27.28 million in the third quarter of 2009. |
| | • | | Compensation expense was $16.07 million during the third quarter of 2010, compared to $15.85 million during the second quarter of 2010 and $14.25 million during the third quarter of 2009. |
| | • | | Included in noninterest expense for the third quarter of 2010 was $8.52 million in other real estate expenses, compared to $1.3 million in the third quarter of 2009. Second quarter 2010 other real estate expense was approximately $7.41 million. |
Excluding the impact of other real estate expenses, the third quarter of 2010 noninterest expense was approximately $29.25 million, compared to $29.08 million in the second quarter of 2010, a slight increase. Carpenter also noted that with the opening of its new 100 Oaks office in April 2010, the firm’s distribution system was substantially complete in the Nashville MSA. With respect to Knoxville, the firm has preliminary plans to construct one more facility over the next two years.
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WEBCAST AND CONFERENCE CALL INFORMATION
Pinnacle will host a webcast and conference call at 8:30 a.m. (CST) on Wednesday, Oct. 20, 2010, to discuss third quarter 2010 results and other matters. To access the call for audio only, please call 1-877-602-7944. For the presentation and streaming audio, please access the webcast on the investor relations page of Pinnacle’s website at www.pnfp.com.
For those unable to participate in the webcast, the webcast will be archived on the investor relations page of Pinnacle’s website at www.pnfp.com for 90 days following the presentation.
Pinnacle Financial Partners provides a full range of banking, investment, mortgage and insurance products and services designed for small- to mid-sized businesses and their owners, real estate professionals and individuals interested in a comprehensive relationship with their financial institution. Comprehensive wealth management services, such as financial planning and trust, help clients increase, protect and distribute their assets.
The firm began operations in a single downtown Nashville location in Oct. 2000 and has since grown to over $4.96 billion in assets at Sept. 30, 2010. In 2007, Pinnacle launched an expansion into Knoxville, Tennessee. At Sept. 30, 2010, Pinnacle is the second-largest bank holding company headquartered in Tennessee, with 31 offices in eight Middle Tennessee counties and three in Knoxville. The firm was also added to Standard & Poor’s SmallCap 600 index in 2009.
Additional information concerning Pinnacle can be accessed atwww.pnfp.com.
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Certain of the statements in this release may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words “expect,” “anticipate,” “goal,” “objective,” “intend,” “plan,” “believe,” “should,” “seek,” “estimate” and similar expressions are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking. All forward-looking statements are subject to risks, uncertainties and other factors that may cause the actual results, performance or achievements of Pinnacle Financial to differ materially from any results expressed or implied by such forward-looking statements. Such factors include, without limitation, (i) deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses; (ii) continuation of the historically low short-term interest rate environment; (iii) the continued reduction of Pinnacle Financial’s loan balances, and conversely, the inability of Pinnacle Financial to ultimately grow its loan portfolio in the Nashville-Davidson-Murfreesboro-Franklin MSA and the Knoxville MSA; (iv) changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments; (v) increased competition with other financial institutions; (vi) greater than anticipated deterioration or lack of sustained growth in the national or local economies including the Nashville-Davidson-Murfreesboro-Franklin MSA and the Knoxville MSA, particularly in commercial and residential real estate markets; (vii) rapid fluctuations or unanticipated changes in interest rates; (viii) the results of regulatory examinations; (ix) the development of any new market other than Nashville or Knoxville; (x) a merger or acquisition; (xi) any matter that would cause Pinnacle Financial to conclude that there was impairment of any asset, including intangible assets; (xii) the impact of governmental restrictions on entities participating in the Capital Purchase Program, of the U.S. Department of the Treasury (the “Treasury”); (xiii) further deterioration in the valuation of other real estate owned; (xiv) inability to comply with regulatory capital requirements and to secure any required regulatory approvals for capital actions; and (xv) changes in state and federal legislation, regulations or policies applicable to banks and other financial service providers, including regulatory or legislative developments arising out of current unsettled conditions in the economy, including implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act; and (xvi) Pinnacle Financial recording a further valuation allowance related to its deferred tax asset. A more detailed description of these and other risks is contained in Pinnacle Financial’s most recent annual report on Form 10-K filed with the Securities and Exchange Commission on February 26, 2010 and most recent quarterly reports on Form 10-Q filed with the Securities and Exchange Commission on May 7, 2010 and July 21, 2010. Many of such factors are beyond Pinnacle Financial’s ability to control or predict, and readers are cautioned not to put undue reliance on such forward-looking statements. Pinnacle Financial disclaims any obligation to update or revise any forward-looking statements contained in this release, whether as a result of new information, future events or otherwise.
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PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS — UNAUDITED
| | | | | | | | | |
| | | September 30, 2010 | | | December 31, 2009 | |
ASSETS | | | | | | | | |
| Cash and noninterest-bearing due from banks | | $ | 59,038,190 | | | $ | 55,651,737 | |
| Interest-bearing due from banks | | | 142,990,988 | | | | 19,338,499 | |
| Federal funds sold and other | | | 3,549,454 | | | | 41,611,838 | |
| Short-term discount notes | | | 44,995,432 | | | | 50,000,000 | |
| | | | | | | |
| Cash and cash equivalents | | | 250,574,064 | | | | 166,602,074 | |
| | | | | | | | | |
| Securities available-for-sale, at fair value | | | 964,206,124 | | | | 931,012,091 | |
| Securities held-to-maturity (fair value of $4,456,899 and $6,737,336 at September 30, 2010 and December 31, 2009, respectively) | | | 4,325,401 | | | | 6,542,496 | |
| Mortgage loans held-for-sale | | | 21,804,306 | | | | 12,440,984 | |
| | | | | | | | | |
| Loans | | | 3,251,923,355 | | | | 3,563,381,741 | |
| Less allowance for loan losses | | | (84,550,007 | ) | | | (91,958,789 | ) |
| | | | | | | |
| Loans, net | | | 3,167,373,348 | | | | 3,471,422,952 | |
| | | | | | | | | |
| Premises and equipment, net | | | 82,528,409 | | | | 80,650,936 | |
| Other investments | | | 42,466,941 | | | | 40,138,660 | |
| Accrued interest receivable | | | 16,921,996 | | | | 19,083,468 | |
| Goodwill | | | 244,096,729 | | | | 244,107,086 | |
| Core deposit and other intangible assets | | | 11,449,597 | | | | 13,686,091 | |
| Other real estate owned | | | 48,710,475 | | | | 29,603,439 | |
| Other assets | | | 107,145,887 | | | | 113,520,727 | |
| | | | | | | |
| Total assets | | $ | 4,961,603,277 | | | $ | 5,128,811,004 | |
| | | | | | | |
| | | | | | | | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | | | |
| Deposits: | | | | | | | | |
| Noninterest-bearing | | $ | 581,181,037 | | | $ | 498,087,015 | |
| Interest-bearing | | | 526,164,256 | | | | 483,273,551 | |
| Savings and money market accounts | | | 1,439,594,226 | | | | 1,198,012,445 | |
| Time | | | 1,278,694,666 | | | | 1,644,226,290 | |
| | | | | | | |
| Total deposits | | | 3,825,634,185 | | | | 3,823,599,301 | |
| Securities sold under agreements to repurchase | | | 191,392,048 | | | | 275,465,096 | |
| Federal Home Loan Bank advances | | | 121,435,261 | | | | 212,654,782 | |
| Subordinated debt | | | 97,476,000 | | | | 97,476,000 | |
| Accrued interest payable | | | 5,766,337 | | | | 6,555,801 | |
| Other liabilities | | | 33,370,673 | | | | 12,039,843 | |
| | | | | | | |
| Total liabilities | | | 4,275,074,504 | | | | 4,427,790,823 | |
| | | | | | | | | |
Stockholders’ equity: | | | | | | | | |
| Preferred stock, no par value; 10,000,000 shares authorized; 95,000 shares issued and outstanding at September 30, 2010 and December 31, 2009 | | | 90,455,129 | | | | 89,462,633 | |
| Common stock, par value $1.00; 90,000,000 shares authorized; 33,660,462 issued and outstanding at September 30, 2010 and 33,029,719 issued and outstanding at December 31, 2009 | | | 33,660,462 | | | | 33,029,719 | |
| Common stock warrants | | | 3,348,402 | | | | 3,348,402 | |
| Additional paid-in capital | | | 528,956,550 | | | | 524,366,603 | |
| Retained earnings | | | 10,721,466 | | | | 43,372,743 | |
| Accumulated other comprehensive income, net of taxes | | | 19,386,764 | | | | 7,440,081 | |
| | | | | | | |
| Stockholders’ equity | | | 686,528,773 | | | | 701,020,181 | |
| | | | | | | |
| Total liabilities and stockholders’ equity | | $ | 4,961,603,277 | | | $ | 5,128,811,004 | |
| | | | | | | |
This information is preliminary and based on company data available at the time of the presentation.
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PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS — UNAUDITED
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | Nine Months Ended | |
| | | September 30 | | | September 30 | |
| | | 2010 | | | 2009 | | | 2010 | | | 2009 | |
Interest income: | | | | | | | | | | | | | | | | |
| Loans, including fees | | $ | 41,105,351 | | | $ | 41,665,915 | | | $ | 122,504,151 | | | $ | 119,818,533 | |
| Securities: | | | | | | | | | | | | | | | | |
| Taxable | | | 7,004,256 | | | | 8,607,924 | | | | 24,150,109 | | | | 26,088,836 | |
| Tax-exempt | | | 1,942,650 | | | | 1,694,323 | | | | 5,978,849 | | | | 4,742,447 | |
| Federal funds sold and other | | | 598,181 | | | | 473,663 | | | | 1,635,934 | | | | 1,338,587 | |
| | | | | | | | | | | | | |
| Total interest income | | | 50,650,438 | | | | 52,441,825 | | | | 154,269,043 | | | | 151,988,403 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
Interest expense: | | | | | | | | | | | | | | | | |
| Deposits | | | 12,306,145 | | | | 15,099,627 | | | | 38,695,099 | | | | 49,253,606 | |
| Securities sold under agreements to repurchase | | | 435,054 | | | | 363,302 | | | | 1,352,015 | | | | 1,147,363 | |
| Federal Home Loan Bank advances and other borrowings | | | 1,849,300 | | | | 2,430,839 | | | | 5,904,792 | | | | 7,826,936 | |
| | | | | | | | | | | | | |
| Total interest expense | | | 14,590,499 | | | | 17,893,768 | | | | 45,951,906 | | | | 58,227,905 | |
| | | | | | | | | | | | | |
| Net interest income | | | 36,059,939 | | | | 34,548,057 | | | | 108,317,137 | | | | 93,760,498 | |
Provision for loan losses | | | 4,789,322 | | | | 22,134,025 | | | | 48,523,927 | | | | 101,063,950 | |
| | | | | | | | | | | | | |
Net interest income after provision for loan losses | | | 31,270,617 | | | | 12,414,032 | | | | 59,793,210 | | | | (7,303,452 | ) |
| | | | | | | | | | | | | | | | | |
Noninterest income: | | | | | | | | | | | | | | | | |
| Service charges on deposit accounts | | | 2,444,077 | | | | 2,559,394 | | | | 7,238,588 | | | | 7,604,774 | |
| Investment services | | | 1,234,421 | | | | 1,112,059 | | | | 3,786,067 | | | | 3,044,444 | |
| Insurance sales commissions | | | 954,015 | | | | 906,298 | | | | 2,957,393 | | | | 3,130,849 | |
| Gain on loans and loan participations sold, net | | | 1,310,169 | | | | 977,662 | | | | 2,733,977 | | | | 4,386,467 | |
| Net gain on sale of investment securities | | | — | | | | — | | | | 2,623,674 | | | | 6,462,241 | |
| Trust fees | | | 726,094 | | | | 585,737 | | | | 2,377,182 | | | | 1,885,091 | |
| Other noninterest income | | | 1,925,459 | | | | 1,595,942 | | | | 5,932,154 | | | | 4,961,175 | |
| | | | | | | | | | | | | |
| Total noninterest income | | | 8,594,235 | | | | 7,737,092 | | | | 27,649,035 | | | | 31,475,041 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
Noninterest expense: | | | | | | | | | | | | | | | | |
| Salaries and employee benefits | | | 16,069,360 | | | | 14,245,485 | | | | 48,921,007 | | | | 41,672,578 | |
| Equipment and occupancy | | | 5,230,730 | | | | 4,445,666 | | | | 16,089,323 | | | | 12,991,928 | |
| Other real estate owned | | | 8,522,346 | | | | 1,250,152 | | | | 21,335,705 | | | | 5,864,375 | |
| Marketing and other business development | | | 748,206 | | | | 512,063 | | | | 2,295,820 | | | | 1,417,780 | |
| Postage and supplies | | | 636,492 | | | | 515,110 | | | | 2,070,536 | | | | 2,174,796 | |
| Amortization of intangibles | | | 744,492 | | | | 776,784 | | | | 2,236,494 | | | | 2,411,351 | |
| Other noninterest expense | | | 5,822,252 | | | | 5,535,079 | | | | 17,482,907 | | | | 16,596,965 | |
| | | | | | | | | | | | | |
| Total noninterest expense | | | 37,773,878 | | | | 27,280,339 | | | | 110,431,792 | | | | 83,129,773 | |
| | | | | | | | | | | | | |
Income (loss) before income taxes | | | 2,090,974 | | | | (7,129,215 | ) | | | (22,989,547 | ) | | | (58,958,184 | ) |
| Income tax expense (benefit) | | | — | | | | (3,782,045 | ) | | | 5,106,734 | | | | (25,925,471 | ) |
| | | | | | | | | | | | | |
Net Income (loss) | | | 2,090,974 | | | | (3,347,170 | ) | | | (28,096,281 | ) | | | (33,032,713 | ) |
| Preferred dividends | | | 1,213,889 | | | | 1,213,889 | | | | 3,602,083 | | | | 3,602,083 | |
| Accretion on preferred stock discount | | | 328,037 | | | | 290,105 | | | | 992,496 | | | | 819,059 | |
| | | | | | | | | | | | | |
Net income (loss) available to common stockholders | | $ | 549,048 | | | $ | (4,851,164 | ) | | $ | (32,690,860 | ) | | $ | (37,453,855 | ) |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
Per share information: | | | | | | | | | | | | | | | | |
| Basic net income (loss) per common share available to common stockholders | | $ | 0.02 | | | $ | (0.15 | ) | | $ | (1.00 | ) | | $ | (1.39 | ) |
| | | | | | | | | | | | | |
| Diluted net income (loss) per common share available to common stockholders | | $ | 0.02 | | | $ | (0.15 | ) | | $ | (1.00 | ) | | $ | (1.39 | ) |
| | | | | | | | | | | | | |
| | |
| Weighted average shares outstanding: | | | | | | | | | | | | | | | | |
| Basic | | | 32,857,428 | | | | 32,460,614 | | | | 32,697,985 | | | | 27,011,749 | |
| Diluted | | | 33,576,963 | | | | 32,460,614 | | | | 32,697,985 | | | | 27,011,749 | |
This information is preliminary and based on company data available at the time of the presentation.
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PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
ANALYSIS OF INTEREST INCOME AND EXPENSE, RATES AND YIELDS — UNAUDITED
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Three months ended | | | Three months ended | |
| | | September 30, 2010 | | | September 30, 2009 | |
| | | Average | | | | | | | | | | | Average | | | | | | | |
| (dollars in thousands) | | Balances | | | Interest | | | Rates/ Yields | | | Balances | | | Interest | | | Rates/ Yields | |
Interest-earning assets: | | | | | | | | | | | | | | | | | | | | | | | | |
| Loans (1) | | $ | 3,295,531 | | | $ | 41,105 | | | | 4.96 | % | | $ | 3,583,182 | | | $ | 41,666 | | | | 4.61 | % |
| Securities: | | | | | | | | | | | | | | | | | | | | | | | | |
| Taxable | | | 750,427 | | | | 7,004 | | | | 3.70 | % | | | 749,457 | | | | 8,608 | | | | 4.56 | % |
| Tax-exempt (2) | | | 204,442 | | | | 1,943 | | | | 4.97 | % | | | 169,171 | | | | 1,694 | | | | 5.24 | % |
| Federal funds sold and other | | | 269,556 | | | | 598 | | | | 0.95 | % | | | 74,663 | | | | 474 | | | | 2.76 | % |
| | | | | | | | | | | | | | | | | | | |
| Total interest-earning assets | | | 4,519,956 | | | $ | 50,650 | | | | 4.51 | % | | | 4,576,473 | | | $ | 52,442 | | | | 4.60 | % |
| | | | | | | | | | | | | | | | | | | | | |
Nonearning assets | | | | | | | | | | | | | | | | | | | | | | | | |
| Intangible assets | | | 256,011 | | | | | | | | | | | | 259,016 | | | | | | | | | |
| Other nonearning assets | | | 225,406 | | | | | | | | | | | | 193,366 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Total assets | | $ | 5,001,373 | | | | | | | | | | | $ | 5,028,855 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing deposits: | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest checking | | $ | 540,387 | | | $ | 890 | | | | 0.65 | % | | $ | 348,300 | | | $ | 508 | | | | 0.58 | % |
| Savings and money market | | | 1,397,396 | | | | 4,787 | | | | 1.36 | % | | | 916,669 | | | | 2,967 | | | | 1.28 | % |
| Time | | | 1,387,170 | | | | 6,629 | | | | 1.90 | % | | | 2,018,814 | | | | 11,625 | | | | 2.28 | % |
| | | | | | | | | | | | | | | | | | | |
| Total interest-bearing deposits | | | 3,324,953 | | | | 12,306 | | | | 1.47 | % | | | 3,283,783 | | | | 15,100 | | | | 1.82 | % |
| Securities sold under agreements to repurchase | | | 210,037 | | | | 435 | | | | 0.82 | % | | | 223,737 | | | | 363 | | | | 0.64 | % |
| Federal Home Loan Bank advances and other borrowings | | | 126,130 | | | | 921 | | | | 2.90 | % | | | 236,660 | | | | 1,481 | | | | 2.48 | % |
| Subordinated debt | | | 97,476 | | | | 928 | | | | 3.78 | % | | | 97,476 | | | | 950 | | | | 3.86 | % |
| | | | | | | | | | | | | | | | | | | |
| Total interest-bearing liabilities | | | 3,758,596 | | | | 14,590 | | | | 1.54 | % | | | 3,841,656 | | | | 17,894 | | | | 1.85 | % |
Noninterest-bearing deposits | | | 534,171 | | | | — | | | | — | | | | 462,783 | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | |
| Total deposits and interest-bearing liabilities | | | 4,292,767 | | | $ | 14,590 | | | | 1.35 | % | | | 4,304,439 | | | $ | 17,894 | | | | 1.65 | % |
| | | | | | | | | | | | | | | | | | | | | |
| Other liabilities | | | 21,708 | | | | | | | | | | | | 8,572 | | | | | | | | | |
Stockholders’ equity | | | 686,898 | | | | | | | | | | | | 715,844 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Total liabilities and stockholders’ equity | | $ | 5,001,373 | | | | | | | | | | | $ | 5,028,855 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Net interest income | | | | | | $ | 36,060 | | | | | | | | | | | $ | 34,548 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Net interest spread (3) | | | | | | | | | | | 2.97 | % | | | | | | | | | | | 2.75 | % |
| Net interest margin (4) | | | | | | | | | | | 3.23 | % | | | | | | | | | | | 3.05 | % |
| | | |
| (1) | | Average balances of nonperforming loans are included in the above amounts. |
| |
| (2) | | Yields computed on tax-exempt instruments on a tax equivalent basis. |
| |
| (3) | | Yields realized on interest-bearing assets less the rates paid on interest-bearing liabilities. The net interest spread calculation excludes the impact of demand deposits. Had the impact of demand deposits been included, the net interest spread for the quarter ended September 30, 2010 would have been 3.16% compared to a net interest spread of 2.95% for the quarter ended September 30, 2009. |
| |
| (4) | | Net interest margin is the result of annualized net interest income calculated on a tax equivalent basis divided by average interest-earning assets for the period. |
This information is preliminary and based on company data available at the time of the presentation.
Page 10
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
ANALYSIS OF INTEREST INCOME AND EXPENSE, RATES AND YIELDS — UNAUDITED
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Nine months ended | | | Nine months ended | |
| | | September 30, 2010 | | | September 30, 2009 | |
| | | Average | | | | | | | | | | | Average | | | | | | | |
| (dollars in thousands) | | Balances | | | Interest | | | Rates/ Yields | | | Balances | | | Interest | | | Rates/ Yields | |
Interest-earning assets: | | | | | | | | | | | | | | | | | | | | | | | | |
| Loans (1) | | $ | 3,410,648 | | | $ | 122,504 | | | | 4.81 | % | | $ | 3,506,243 | | | $ | 119,819 | | | | 4.57 | % |
| Securities: | | | | | | | | | | | | | | | | | | | | | | | | |
| Taxable | | | 778,117 | | | | 24,150 | | | | 4.15 | % | | | 739,480 | | | | 26,089 | | | | 4.72 | % |
| Tax-exempt (2) | | | 205,006 | | | | 5,979 | | | | 5.14 | % | | | 159,086 | | | | 4,742 | | | | 5.26 | % |
| Federal funds sold and other | | | 173,732 | | | | 1,636 | | | | 1.36 | % | | | 82,614 | | | | 1,338 | | | | 2.35 | % |
| | | | | | | | | | | | | | | | | | | |
| Total interest-earning assets | | | 4,567,503 | | | $ | 154,269 | | | | 4.58 | % | | | 4,487,423 | | | $ | 151,988 | | | | 4.58 | % |
| | | | | | | | | | | | | | | | | | | | | |
Nonearning assets | | | | | | | | | | | | | | | | | | | | | | | | |
| Intangible assets | | | 256,754 | | | | | | | | | | | | 259,894 | | | | | | | | | |
| Other nonearning assets | | | 215,492 | | | | | | | | | | | | 219,859 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Total assets | | $ | 5,039,749 | | | | | | | | | | | $ | 4,967,176 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing deposits: | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest checking | | $ | 516,024 | | | $ | 2,593 | | | | 0.67 | % | | $ | 355,677 | | | $ | 1,405 | | | | 0.53 | % |
| Savings and money market | | | 1,312,209 | | | | 13,623 | | | | 1.39 | % | | | 802,946 | | | | 7,322 | | | | 1.22 | % |
| Time | | | 1,503,524 | | | | 22,479 | | | | 2.00 | % | | | 2,106,428 | | | | 40,527 | | | | 2.57 | % |
| | | | | | | | | | | | | | | | | | | |
| Total interest-bearing deposits | | | 3,331,757 | | | | 38,695 | | | | 1.55 | % | | | 3,265,051 | | | | 49,254 | | | | 2.02 | % |
| Securities sold under agreements to repurchase | | | 231,580 | | | | 1,352 | | | | 0.78 | % | | | 232,450 | | | | 1,147 | | | | 0.66 | % |
| Federal Home Loan Bank advances and other borrowings | | | 150,772 | | | | 3,249 | | | | 2.88 | % | | | 254,145 | | | | 4,657 | | | | 2.45 | % |
| Subordinated debt | | | 97,476 | | | | 2,656 | | | | 3.64 | % | | | 97,476 | | | | 3,170 | | | | 4.35 | % |
| | | | | | | | | | | | | | | | | | | |
| Total interest-bearing liabilities | | | 3,811,585 | | | | 45,952 | | | | 1.61 | % | | | 3,849,122 | | | | 58,228 | | | | 2.02 | % |
Noninterest-bearing deposits | | | 511,519 | | | | — | | | | — | | | | 445,616 | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | |
| Total deposits and interest-bearing liabilities | | | 4,323,104 | | | $ | 45,952 | | | | 1.42 | % | | | 4,294,738 | | | $ | 58,228 | | | | 1.81 | % |
| | | | | | | | | | | | | | | | | | | | | |
| Other liabilities | | | 17,297 | | | | | | | | | | | | 5,436 | | | | | | | | | |
Stockholders’ equity | | | 699,348 | | | | | | | | | | | | 667,002 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| | | $ | 5,039,749 | | | | | | | | | | | $ | 4,967,176 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Net interest income | | | | | | $ | 108,317 | | | | | | | | | | | $ | 93,760 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Net interest spread (3) | | | | | | | | | | | 2.97 | % | | | | | | | | | | | 2.56 | % |
| Net interest margin (4) | | | | | | | | | | | 3.24 | % | | | | | | | | | | | 2.84 | % |
| | | |
| (1) | | Average balances of nonperforming loans are included in the above amounts. |
| |
| (2) | | Yields computed on tax-exempt instruments on a tax equivalent basis. |
| |
| (3) | | Yields realized on interest-earning assets less the rates paid on interest-bearing liabilities.The net interest spread calculation excludes the impact of demand deposits. Had the impact of demand deposits been included, the net interest spread for the nine months ended September 30, 2010 would have been 3.16% compared to a net interest spread of 2.77% for the nine months ended September 30, 2009. |
| |
| (4) | | Net interest margin is the result of annualized net interest income calculated on a tax equivalent basis divided by average interest-earning assets for the period. |
This information is preliminary and based on company data available at the time of the presentation.
Page 11
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA — UNAUDITED
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | September | | | June | | | March | | | December | | | September | | | June | |
| (dollars in thousands) | | 2010 | | | 2010 | | | 2010 | | | 2009 | | | 2009 | | | 2009 | |
Balance sheet data, at quarter end: | | | | | | | | | | | | | | | | | | | | | | | | |
| Total assets | | $ | 4,961,603 | | | | 4,958,478 | | | | 5,021,689 | | | | 5,128,811 | | | | 5,094,710 | | | | 5,036,742 | |
| Total loans | | | 3,251,923 | | | | 3,333,900 | | | | 3,479,536 | | | | 3,563,382 | | | | 3,607,886 | | | | 3,544,176 | |
| Allowance for loan losses | | | (84,550 | ) | | | (87,107 | ) | | | (90,062 | ) | | | (91,959 | ) | | | (82,981 | ) | | | (66,075 | ) |
| Securities | | | 968,532 | | | | 907,296 | | | | 989,325 | | | | 937,555 | | | | 932,440 | | | | 926,085 | |
| Noninterest-bearing deposits | | | 581,181 | | | | 529,867 | | | | 522,928 | | | | 498,087 | | | | 504,481 | | | | 470,049 | |
| Total deposits | | | 3,825,634 | | | | 3,853,400 | | | | 3,836,362 | | | | 3,823,599 | | | | 3,819,909 | | | | 3,761,444 | |
| Securities sold under agreements to repurchase | | | 191,392 | | | | 159,490 | | | | 200,489 | | | | 275,465 | | | | 215,674 | | | | 215,135 | |
| FHLB advances and other borrowings | | | 121,435 | | | | 131,477 | | | | 157,319 | | | | 212,655 | | | | 222,986 | | | | 228,317 | |
| Subordinated debt | | | 97,476 | | | | 97,476 | | | | 97,476 | | | | 97,476 | | | | 97,476 | | | | 97,476 | |
| Total stockholders’ equity | | | 686,529 | | | | 681,915 | | | | 700,261 | | | | 701,020 | | | | 710,091 | | | | 703,772 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Balance sheet data, quarterly averages: | | | | | | | | | | | | | | | | | | | | | | | | |
| Total assets | | $ | 5,001,373 | | | | 4,996,448 | | | | 5,122,773 | | | | 5,143,832 | | | | 5,028,855 | | | | 5,001,489 | |
| Total loans | | | 3,295,531 | | | | 3,418,928 | | | | 3,520,012 | | | | 3,580,790 | | | | 3,583,182 | | | | 3,517,254 | |
| Securities | | | 954,869 | | | | 962,401 | | | | 1,032,957 | | | | 984,893 | | | | 918,628 | | | | 912,192 | |
| Total earning assets | | | 4,519,956 | | | | 4,527,471 | | | | 4,651,695 | | | | 4,690,347 | | | | 4,576,473 | | | | 4,523,003 | |
| Noninterest-bearing deposits | | | 534,171 | | | | 504,354 | | | | 495,610 | | | | 517,296 | | | | 462,783 | | | | 455,709 | |
| Total deposits | | | 3,859,124 | | | | 3,816,973 | | | | 3,853,671 | | | | 3,786,680 | | | | 3,746,566 | | | | 3,735,789 | |
| Securities sold under agreements to repurchase | | | 210,037 | | | | 210,798 | | | | 274,614 | | | | 303,801 | | | | 223,737 | | | | 243,765 | |
| Advances from FHLB and other borrowings | | | 126,130 | | | | 147,491 | | | | 179,280 | | | | 229,734 | | | | 236,660 | | | | 255,263 | |
| Subordinated debt | | | 97,476 | | | | 97,476 | | | | 97,476 | | | | 97,476 | | | | 97,476 | | | | 97,476 | |
| Total stockholders’ equity | | | 686,898 | | | | 704,186 | | | | 707,210 | | | | 714,741 | | | | 715,844 | | | | 649,792 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Statement of operations data, for the three months ended: | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest income | | $ | 50,650 | | | | 50,929 | | | | 52,690 | | | | 53,728 | | | | 52,442 | | | | 50,028 | |
| Interest expense | | | 14,590 | | | | 15,231 | | | | 16,130 | | | | 16,697 | | | | 17,894 | | | | 19,516 | |
| | | | | | | | | | | | | | | | | | | |
| Net interest income | | | 36,060 | | | | 35,697 | | | | 36,560 | | | | 37,031 | | | | 34,548 | | | | 30,512 | |
| Provision for loan losses | | | 4,789 | | | | 30,509 | | | | 13,226 | | | | 15,694 | | | | 22,134 | | | | 65,320 | |
| | | | | | | | | | | | | | | | | | | |
| Net interest income (loss) after provision for loan losses | | | 31,271 | | | | 5,189 | | | | 23,334 | | | | 21,336 | | | | 12,414 | | | | (34,808 | ) |
| Noninterest income | | | 8,594 | | | | 10,569 | | | | 8,486 | | | | 8,177 | | | | 7,737 | | | | 10,602 | |
| Noninterest expense | | | 37,774 | | | | 36,491 | | | | 36,167 | | | | 35,448 | | | | 27,281 | | | | 30,607 | |
| | | | | | | | | | | | | | | | | | | |
| Income (loss) before taxes | | | 2,091 | | | | (20,734 | ) | | | (4,347 | ) | | | (5,935 | ) | | | (7,130 | ) | | | (54,813 | ) |
| Income tax expense (benefit) | | | — | | | | 5,630 | | | | (525 | ) | | | (3,467 | ) | | | (3,782 | ) | | | (23,036 | ) |
| Preferred dividends and accretion | | | 1,542 | | | | 1,507 | | | | 1,545 | | | | 1,509 | | | | 1,504 | | | | 1,470 | |
| | | | | | | | | | | | | | | | | | | |
| Net income (loss) available to common stockholders | | $ | 549 | | | | (27,871 | ) | | | (5,368 | ) | | | (3,977 | ) | | | (4,852 | ) | | | (33,247 | ) |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Profitability and other ratios: | | | | | | | | | | | | | | | | | | | | | | | | |
| Return on avg. assets (1) | | | 0.04 | % | | | (2.24 | %) | | | (0.42 | %) | | | (0.31 | %) | | | (0.38 | %) | | | (2.67 | %) |
| Return on avg. equity (1) | | | 0.32 | % | | | (15.88 | %) | | | (3.08 | %) | | | (2.21 | %) | | | (2.69 | %) | | | (20.52 | %) |
| Net interest margin (1) (2) | | | 3.23 | % | | | 3.23 | % | | | 3.25 | % | | | 3.19 | % | | | 3.05 | % | | | 2.75 | % |
| Noninterest income to total revenue (3) | | | 19.25 | % | | | 22.84 | % | | | 18.84 | % | | | 18.09 | % | | | 18.30 | % | | | 25.79 | % |
| Noninterest income to avg. assets (1) | | | 0.68 | % | | | 0.85 | % | | | 0.67 | % | | | 0.63 | % | | | 0.61 | % | | | 0.85 | % |
| Noninterest exp. to avg. assets (1) | | | 3.00 | % | | | 2.93 | % | | | 2.86 | % | | | 2.73 | % | | | 2.15 | % | | | 2.45 | % |
| Efficiency ratio (4) | | | 84.59 | % | | | 78.87 | % | | | 80.29 | % | | | 78.41 | % | | | 64.52 | % | | | 74.44 | % |
| Avg. loans to average deposits | | | 85.40 | % | | | 89.57 | % | | | 91.34 | % | | | 94.56 | % | | | 95.64 | % | | | 94.15 | % |
| Securities to total assets | | | 19.52 | % | | | 18.30 | % | | | 19.70 | % | | | 18.28 | % | | | 18.30 | % | | | 18.39 | % |
| Average interest-earning assets to average interest-bearing liabilities | | | 120.26 | % | | | 120.14 | % | | | 118.99 | % | | | 120.25 | % | | | 119.13 | % | | | 116.67 | % |
| Brokered time deposits to total deposits (15) | | | 1.80 | % | | | 3.70 | % | | | 5.40 | % | | | 8.67 | % | | | 11.50 | % | | | 14.71 | % |
This information is preliminary and based on company data available at the time of the presentation.
Page 12
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA — UNAUDITED
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | September | | | June | | | March | | | December | | | September | | | June | |
| (dollars in thousands) | | 2010 | | | 2010 | | | 2010 | | | 2009 | | | 2009 | | | 2009 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Asset quality information and ratios: | | | | | | | | | | | | | | | | | | | | | | | | |
| Nonperforming assets: | | | | | | | | | | | | | | | | | | | | | | | | |
| Nonaccrual loans | | $ | 103,127 | | | | 118,331 | | | | 131,381 | | | | 124,709 | | | | 121,726 | | | | 100,328 | |
| Other real estate (ORE) | | | 48,710 | | | | 42,616 | | | | 24,704 | | | | 29,603 | | | | 22,769 | | | | 18,845 | |
| Past due loans over 90 days and still accruing interest | | | 3,639 | | | | 3,116 | | | | 395 | | | | 181 | | | | 65 | | | | — | |
| Restructured accruing loans | | | 13,468 | | | | 10,861 | | | | 9,534 | | | | 26,978 | | | | 12,827 | | | | — | |
| | | | | | | | | | | | | | | | | | | |
| Totals | | $ | 168,944 | | | | 174,924 | | | | 166,014 | | | | 181,471 | | | | 157,387 | | | | 119,173 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Net loan charge-offs | | $ | 7,346 | | | | 33,463 | | | | 15,123 | | | | 6,718 | | | | 5,228 | | | | 44,579 | |
| Allowance for loan losses to nonaccrual loans | | | 82.0 | % | | | 73.6 | % | | | 68.5 | % | | | 73.7 | % | | | 68.2 | % | | | 65.9 | % |
| As a percentage of total loans: | | | | | | | | | | | | | | | | | | | | | | | | |
| Past due accruing loans over 30 days | | | 0.67 | % | | | 0.66 | % | | | 1.54 | % | | | 0.46 | % | | | 0.86 | % | | | 0.52 | % |
| Potential problem loans (5) | | | 8.23 | % | | | 9.30 | % | | | 8.63 | % | | | 7.18 | % | | | 7.24 | % | | | 4.03 | % |
| Allowance for loan losses | | | 2.60 | % | | | 2.61 | % | | | 2.59 | % | | | 2.58 | % | | | 2.30 | % | | | 1.86 | % |
| Nonperforming assets to total loans and ORE | | | 4.60 | % | | | 4.77 | % | | | 4.45 | % | | | 4.29 | % | | | 3.98 | % | | | 3.34 | % |
| Nonperforming assets to total assets | | | 3.06 | % | | | 3.25 | % | | | 3.11 | % | | | 3.01 | % | | | 2.84 | % | | | 2.37 | % |
| Annualized net loan charge-offs year-to-date to avg. loans (6) | | | 2.26 | % | | | 2.84 | % | | | 1.74 | % | | | 1.71 | % | | | 2.04 | % | | | 2.81 | % |
| Avg. commercial loan internal risk ratings (5) | | | 4.9 | | | | 4.9 | | | | 4.9 | | | | 4.8 | | | | 4.7 | | | | 4.6 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Interest rates and yields: | | | | | | | | | | | | | | | | | | | | | | | | |
| Loans | | | 4.96 | % | | | 4.74 | % | | | 4.74 | % | | | 4.71 | % | | | 4.61 | % | | | 4.52 | % |
| Securities | | | 3.97 | % | | | 4.45 | % | | | 4.63 | % | | | 4.57 | % | | | 4.69 | % | | | 4.60 | % |
| Total earning assets | | | 4.51 | % | | | 4.58 | % | | | 4.66 | % | | | 4.60 | % | | | 4.60 | % | | | 4.49 | % |
| Total deposits, including non-interest bearing | | | 1.27 | % | | | 1.43 | % | | | 1.42 | % | | | 1.45 | % | | | 1.60 | % | | | 1.76 | % |
| Securities sold under agreements to repurchase | | | 0.82 | % | | | 0.69 | % | | | 0.82 | % | | | 0.71 | % | | | 0.64 | % | | | 0.70 | % |
| FHLB advances and other borrowings | | | 2.90 | % | | | 2.88 | % | | | 2.87 | % | | | 2.50 | % | | | 2.48 | % | | | 2.52 | % |
| Subordinated debt | | | 3.78 | % | | | 3.63 | % | | | 3.52 | % | | | 3.38 | % | | | 3.86 | % | | | 4.39 | % |
| Total deposits and interest-bearing liabilities | | | 1.35 | % | | | 1.43 | % | | | 1.49 | % | | | 1.50 | % | | | 1.65 | % | | | 1.81 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Capital ratios (7): | | | | | | | | | | | | | | | | | | | | | | | | |
| Stockholders’ equity to total assets | | | 13.8 | % | | | 13.8 | % | | | 13.9 | % | | | 13.7 | % | | | 13.9 | % | | | 14.0 | % |
| Leverage | | | 10.5 | % | | | 10.4 | % | | | 10.6 | % | | | 10.7 | % | | | 10.9 | % | | | 11.1 | % |
| Tier one risk-based | | | 13.5 | % | | | 13.1 | % | | | 13.4 | % | | | 13.1 | % | | | 13.1 | % | | | 13.3 | % |
| Total risk-based | | | 15.1 | % | | | 14.8 | % | | | 15.0 | % | | | 14.8 | % | | | 14.7 | % | | | 15.0 | % |
| Tangible common equity to tangible assets | | | 7.2 | % | | | 7.1 | % | | | 7.4 | % | | | 7.3 | % | | | 7.5 | % | | | 7.4 | % |
| Tangible common equity to risk weighted assets | | | 9.3 | % | | | 9.0 | % | | | 9.1 | % | | | 8.9 | % | | | 9.1 | % | | | 9.0 | % |
This information is preliminary and based on company data available at the time of the presentation.
Page 13
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA — UNAUDITED
| | | | | | | | | | | | | | | | | | | | | | | | | |
| (dollars in thousands, | | September | | | June | | | March | | | December | | | September | | | June | |
| except per share data) | | 2010 | | | 2010 | | | 2010 | | | 2009 | | | 2009 | | | 2009 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Per share data: | | | | | | | | | | | | | | | | | | | | | | | | |
| Earnings (loss) — basic | | $ | 0.02 | | | | (0.85 | ) | | | (0.16 | ) | | | (0.12 | ) | | | (0.15 | ) | | | (1.33 | ) |
| Earnings (loss) — diluted | | $ | 0.02 | | | | (0.85 | ) | | | (0.16 | ) | | | (0.12 | ) | | | (0.15 | ) | | | (1.33 | ) |
| Book value per common share at quarter end (8) | | $ | 17.61 | | | | 17.61 | | | | 18.20 | | | | 18.41 | | | | 18.74 | | | | 18.57 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Weighted avg. common shares — basic | | | 32,857,428 | | | | 32,675,221 | | | | 32,558,016 | | | | 32,502,101 | | | | 32,460,614 | | | | 24,965,291 | |
| Weighted avg. common shares — diluted | | | 33,576,963 | | | | 32,675,221 | | | | 32,558,016 | | | | 32,502,101 | | | | 32,460,614 | | | | 24,965,291 | |
| Common shares outstanding | | | 33,660,462 | | | | 33,421,741 | | | | 33,351,118 | | | | 33,029,719 | | | | 32,956,737 | | | | 32,929,747 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Investor information: | | | | | | | | | | | | | | | | | | | | | | | | |
| Closing sales price | | $ | 9.19 | | | | 12.85 | | | | 15.11 | | | | 14.22 | | | | 12.71 | | | | 13.32 | |
| High closing sales price during quarter | | $ | 14.33 | | | | 18.93 | | | | 16.88 | | | | 14.47 | | | | 17.03 | | | | 24.01 | |
| Low closing sales price during quarter | | $ | 8.51 | | | | 11.81 | | | | 13.10 | | | | 11.45 | | | | 12.15 | | | | 12.86 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Other information: | | | | | | | | | | | | | | | | | | | | | | | | |
| Gains on sale of loans and loan participations sold: | | | | | | | | | | | | | | | | | | | | | | | | |
| Mortgage loan sales: | | | | | | | | | | | | | | | | | | | | | | | | |
| Gross loans sold | | $ | 137,094 | | | | 92,144 | | | | 72,196 | | | | 120,760 | | | | 114,049 | | | | 213,218 | |
| Gross fees (9) | | $ | 2,503 | | | | 1,669 | | | | 1,157 | | | | 1,942 | | | | 1,910 | | | | 3,317 | |
| Gross fees as a percentage of mortgage loans originated | | | 1.83 | % | | | 1.81 | % | | | 1.60 | % | | | 1.61 | % | | | 1.67 | % | | | 1.56 | % |
| Gains on sales of investment securities, net | | $ | — | | | | 2,259 | | | | 365 | | | | — | | | | — | | | | 2,116 | |
| Brokerage account assets, at quarter-end (10) | | $ | 966,000 | | | | 921,000 | | | | 974,000 | | | | 933,000 | | | | 898,000 | | | | 786,000 | |
| Trust account assets, at quarter-end | | $ | 647,000 | | | | 627,000 | | | | 648,000 | | | | 635,000 | | | | 607,000 | | | | 580,000 | |
| Floating rate loans as a percentage of total loans (11) | | | 37.9 | % | | | 37.8 | % | | | 38.9 | % | | | 38.0 | % | | | 38.0 | % | | | 39.8 | % |
| Balance of commercial loan participations sold to other banks and serviced by Pinnacle, at quarter end | | $ | 57,964 | | | | 66,503 | | | | 78,529 | | | | 81,630 | | | | 92,837 | | | | 102,515 | |
| Core deposits (12) | | $ | 2,925,673 | | | | 2,781,748 | | | | 2,676,016 | | | | 2,586,685 | | | | 2,242,245 | | | | 2,094,399 | |
| Core deposits to total funding (12) | | | 69.0 | % | | | 65.2 | % | | | 62.4 | % | | | 58.7 | % | | | 51.5 | % | | | 48.7 | % |
| Risk-weighted assets | | $ | 3,679,436 | | | | 3,748,498 | | | | 3,878,884 | | | | 3,970,193 | | | | 4,000,359 | | | | 3,942,844 | |
| Total assets per full-time equivalent employee | | $ | 6,349 | | | | 6,229 | | | | 6,389 | | | | 6,601 | | | | 6,634 | | | | 6,752 | |
| Annualized revenues per full-time equivalent employee | | | 235.0 | | | | 233.1 | | | | 232.4 | | | | 234.0 | | | | 221.4 | | | | 221.7 | |
| Number of employees (full-time equivalent) | | | 781.0 | | | | 796.0 | | | | 786.0 | | | | 777.0 | | | | 768.0 | | | | 746.0 | |
| Associate retention rate (13) | | | 95.2 | % | | | 97.3 | % | | | 96.6 | % | | | 95.5 | % | | | 94.2 | % | | | 92.5 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Selected economic information (in thousands) (14): | | | | | | | | | | | | | | | | | | | | | | | | |
| Nashville MSA nonfarm employment | | | 714.5 | | | | 712.0 | | | | 713.7 | | | | 724.7 | | | | 728.3 | | | | 725.1 | |
| Knoxville MSA nonfarm employment | | | 321.0 | | | | 320.1 | | | | 317.2 | | | | 322.1 | | | | 323.2 | | | | 322.5 | |
| Nashville MSA unemployment | | | 8.8 | % | | | 9.0 | % | | | 9.5 | % | | | 9.4 | % | | | 9.2 | % | | | 10.0 | % |
| Knoxville MSA unemployment | | | 7.8 | % | | | 8.1 | % | | | 8.8 | % | | | 8.7 | % | | | 8.6 | % | | | 9.3 | % |
| Nashville residential median home price | | $ | 178.0 | | | | 171.3 | | | | 159.4 | | | | 160.8 | | | | 163.7 | | | | 170.7 | |
| Nashville inventory of residential homes for sale | | | 14.9 | | | | 14.9 | | | | 14.1 | | | | 13.3 | | | | 14.7 | | | | 15.0 | |
This information is preliminary and based on company data available at the time of the presentation.
Page 14
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP SELECTED QUARTERLY FINANCIAL DATA — UNAUDITED
| | | | | | | | | |
| | | As of September 30, | | | As of December 31, | |
| (dollars in thousands, except per share data) | | 2010 | | | 2009 | |
Reconciliation of certain financial measures: | | | | | | | | |
| Tangible assets: | | | | | | | | |
| Total assets | | $ | 4,961,603 | | | $ | 5,128,811 | |
| Less: Goodwill | | | (244,097 | ) | | | (244,107 | ) |
| Core deposit and other intangibles | | | (11,450 | ) | | | (13,686 | ) |
| | | | | | | |
| Net tangible assets | | $ | 4,706,057 | | | $ | 4,871,018 | |
| | | | | | | |
| | | | | | | | | |
| Tangible common equity: | | | | | | | | |
| Total stockholders’ equity | | $ | 686,529 | | | $ | 701,020 | |
| Less: Preferred stock | | | (90,455 | ) | | | (89,463 | ) |
| Goodwill | | | (244,097 | ) | | | (244,107 | ) |
| Core deposit and other intangibles | | | (11,450 | ) | | | (13,686 | ) |
| | | | | | | |
| Net tangible common equity | | $ | 340,527 | | | $ | 353,764 | |
| | | | | | | |
| | | | | | | | | |
Ratio of tangible common equity to tangible assets | | | 7.24 | % | | | 7.26 | % |
| | | | | | | |
| | | | | | | | | |
Tangible common equity per common share | | $ | 10.12 | | | $ | 10.71 | |
| | | | | | | |
| | | | | | | | | |
| | | For the three months ended | |
| (dollars in thousands) | | September 30, 2010 | | | June 30, 2010 | |
| | | | | | | | | |
| Noninterest expense | | | 37,774 | | | | 36,491 | |
| Other real estate owned expense | | | 8,522 | | | | 7,411 | |
| | | | | | | |
| Noninterest expense excluding the impact of other real estate owned expense | | $ | 29,252 | | | $ | 29,080 | |
| | | | | | | |
This information is preliminary and based on company data available at the time of the presentation.
Page 15
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA — UNAUDITED
| | | |
| 1. | | Ratios are presented on an annualized basis. |
| |
| 2. | | Net interest margin is the result of net interest income on a tax equivalent basis divided by average interest earning assets. |
| |
| 3. | | Total revenue is equal to the sum of net interest income and noninterest income. |
| |
| 4. | | Efficiency ratios are calculated by dividing noninterest expense by the sum of net interest income and noninterest income. |
| |
| 5. | | Average risk ratings are based on an internal loan review system which assigns a numeric value of 1 to 10 to all loans to commercial entities based on their underlying risk characteristics as of the end of each quarter. A “1” risk rating is assigned to credits that exhibit Excellent risk characteristics, “2” exhibit Very Good risk characteristics, “3” Good, “4” Satisfactory, “5” Acceptable or Average, “6” Watch List, “7” Criticized, “8” Classified or Substandard, “9” Doubtful and “10” Loss (which are charged-off immediately). Additionally, loans rated “8” or worse that are not nonperforming or restructured loans are considered potential problem loans. Generally, consumer loans are not subjected to internal risk ratings. |
| |
| 6. | | Annualized net loan charge-offs to average loans ratios are computed by annualizing year-to-date net loan charge-offs and dividing the result by average loans for the year-to-date period. |
| |
| 7. | | Capital ratios are for Pinnacle Financial Partners, Inc. and are defined as follows:
|
| |
| | | Equity to total assets — End of period total stockholders’ equity as a percentage of end of period assets. |
| |
| | | Leverage — Tier one capital (pursuant to risk-based capital guidelines) as a percentage of adjusted average assets. |
| |
| | | Tier one risk-based — Tier one capital (pursuant to risk-based capital guidelines) as a percentage of total risk-weighted assets. |
| |
| | | Total risk-based — Total capital (pursuant to risk-based capital guidelines) as a percentage of total risk-weighted assets. |
| |
| 8. | | Book value per share computed by dividing total stockholders’ equity less preferred stock and common stock warrants by common shares outstanding. |
| |
| 9. | | Amounts are included in the statement of operations in “Gains on the sale of loans and loan participations sold”, net of commissions paid on such amounts. |
| |
| 10. | | At fair value, based on information obtained from Pinnacle’s third party broker/dealer for non-FDIC insured financial products and services. |
| |
| 11. | | Floating rate loans are those loans that are eligible for repricing on a daily basis subject to changes in Pinnacle’s prime lending rate or other factors. |
| |
| 12. | | Core deposits include all transaction deposit accounts, money market and savings accounts and all certificates of deposit issued in a denomination of less than $100,000. The ratio noted above represents total core deposits divided by total funding, which includes total deposits, FHLB advances, securities sold under agreements to repurchase, subordinated indebtedness and all other interest-bearing liabilities. |
| |
| 13. | | Associate retention rate is computed by dividing the number of associates employed at quarter-end less the number of associates that have resigned in the last 12 months by the number of associates employed at quarter-end. |
| |
| 14. | | Employment and unemployment data is from the US Dept. of Labor Bureau of Labor Statistics. Labor force data is not seasonally adjusted. The most recent quarter data presented is as of the most recent month that data is available as of the release date. The Nashville home data is from the Greater Nashville Association of Realtors. |
| |
| 15. | | Brokered deposits do not include reciprocal balances under the Certificate of Deposit Account Registry Service (CDARS). |
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