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FOR IMMEDIATE RELEASE
MEDIA CONTACT: Vicki Kessler 615-320-7532
FINANCIAL CONTACT: Harold Carpenter 615-744-3742
WEBSITE: www.pnfp.com
PINNACLE FINANCIAL REPORTS RECORD EARNINGS
Diluted earnings per share excluding merger related charges
exceed I/B/E/S consensus estimate
NASHVILLE, Tenn., Oct. 17, 2006 - Pinnacle Financial Partners, Inc. (Nasdaq/NGS: PNFP) today reported record earnings and superior credit quality for the quarter ended Sept. 30, 2006. Fully diluted earnings per share of $0.32 for the quarter included the impact of merger related expenses of $0.01 which were associated with Pinnacle’s merger with Cavalry Bancorp that was effective on March 15, 2006. As a result, fully diluted earnings per share exclusive of merger related items were $0.33 for the quarter ended Sept. 30, 2006, compared to $0.22 fully diluted earnings per share for the quarter ended Sept. 30, 2005, an increase of 50 percent.
Fully diluted earnings per share of $0.84 for the nine months ended Sept. 30, 2006, included the impact of merger related expenses of $0.06. As a result, fully diluted earnings per share exclusive of merger related items were $0.90 for the nine months ended Sept. 30, 2006, compared to $0.62 fully diluted earnings per share for the nine months ended Sept. 30, 2005, an increase of 45 percent.
THIRD QUARTER 2006 HIGHLIGHTS:
· | Record earnings: |
o | Record net income for the third quarter of 2006 of $5.35 million, up 157 percent from the prior year’s third quarter net income of $2.08 million. |
o | Record diluted earnings per share for the third quarter of 2006 of $0.32, up almost 45 percent from the same quarter last year. Diluted earnings per share exclusive of merger related expenses were $0.33, up 50 percent from |
Pinnacle Reports Record Earnings - 2 of 8
the prior year’s third quarter diluted earnings per share of $0.22. Fully diluted earnings per share exclusive of merger related charges for the quarter ended Sept. 30, 2006, were $0.33 exceeding the I/B/E/S consensus estimate of $0.32 per fully diluted share.
o | Revenue (the sum of net interest income and noninterest income) for the quarter ended Sept. 30, 2006, amounted to $21.58 million, compared to $8.75 million for the same quarter of last year, an increase of 147 percent. |
o | Return on average tangible stockholders’ equity (average stockholders’ equity less goodwill and core deposit intangibles) before impact of merger related expense was 18.41 percent for the quarter ended Sept. 30, 2006, compared to 13.23 percent for the same quarter last year. |
· | Superior credit quality: |
o | Nonperforming assets were only 0.25 percent of total loans at Sept. 30, 2006. |
o | Past due loans over 30 days, excluding nonperforming loans, were only 0.69 percent of total loans at Sept. 30, 2006. |
· | Strong balance sheet growth: |
o | Loans at Sept. 30, 2006, were $1.405 billion, up 133 percent from the same period last year, reflecting strong organic growth and the impact of the Cavalry merger. Net loans increased by $47 million between the second and third quarters of 2006. Excluding the $551 million in loans added in conjunction with the Cavalry merger on March 15, 2006, net loans have increased $207 million during the first nine months of this year, an increase of 57 percent over the $132 million in combined growth for the two companies the first nine months of 2005 prior to the merger. |
o | Total deposits at Sept. 30, 2006, were $1.59 billion, up 101 percent from the same period last year. Noninterest bearing demand deposit accounts, which represent 19.3 percent of total deposits, were up 98 percent from the same period last year, reflecting strong organic growth and the impact of the Cavalry merger. |
Pinnacle Reports Record Earnings - 3 of 8
o | Subordinated indebtedness of $20.6 million issued in connection with Pinnacle’s most recent trust preferred securities offering. The issuance of these securities increased Pinnacle’s regulatory capital ratios at Sept. 30, 2006. |
“The continued growth and strength of Middle Tennessee’s economy, coupled with our ability to attract and retain the best financial professionals in the market, have led to another exceptional quarter of performance,” said M. Terry Turner, Pinnacle’s president and CEO.
EXTRAORDINARY GROWTH MAKES PINNACLE THE LARGEST NASHVILLE BANK
With its acquisition of Cavalry and dramatic organic loan and deposit growth during the first nine months of 2006, Pinnacle now has $2.052 billion in assets, making the company the largest financial services firm headquartered in Nashville and the second largest headquartered in Tennessee.
“We find that being the largest locally owned firm provides clients an attractive alternative in a market dominated by large regional and national franchises with longstanding market share loss trends. We are confident that our advantages will lead to our continued rapid growth,” said Turner.
Pinnacle’s merger with Cavalry was completed on March 15, 2006. Consequently, Pinnacle’s balance sheet and statement of income have reflected the Cavalry amounts since March 15, 2006.
FINANCIAL PERFORMANCE AND BALANCE SHEET GROWTH
· | Return on average assets for the quarter ended Sept. 30, 2006, was 1.07 percent. Return on average tangible assets (average total assets less goodwill and core deposit intangibles) for the quarter ended Sept. 30, 2006, was 1.15 percent. The return on average tangible assets exclusive of merger related items for the quarter ended June 30, 2006, was 1.18 percent, compared to 0.91 percent for the same quarter last year. |
Pinnacle Reports Record Earnings - 4 of 8
· | Return on average stockholders’ equity for the quarter ended Sept. 30, 2006, was 8.66 percent. Return on average tangible stockholders’ equity (average total stockholders’ equity less goodwill and core deposit intangibles) for the quarter ended Sept. 30, 2006, was 17.97 percent. Return on average tangible stockholders’ equity exclusive of merger related expenses for the quarter ended Sept. 30, 2006, was 18.41 percent, compared to 13.23 percent for the same quarter last year. |
Total assets grew to $2.052 billion as of Sept. 30, 2006, up $1.07 billion or 110 percent from the $979 million reported at Sept. 30, 2005. The $1.07 billion year over year increase in total assets was comprised of $277 million in organic asset growth at Pinnacle, $670 million in assets associated with the acquisition of Cavalry Bancorp and $127 million in goodwill and core deposit intangibles associated with that acquisition. This rapid asset growth was achieved while reducing the securities to total assets ratio from 27.4 percent at Dec. 31, 2005, to 16.1 percent at Sept. 30, 2006.
CREDIT QUALITY
· | Provision for loan losses was $587,000 for the third quarter of 2006, compared to $366,000 in the third quarter of 2005. During the third quarter of 2006, the firm recorded net charge-offs of $101,000 compared to net recoveries of $206,000 during the same period in 2005. |
o | Annualized net charge-offs to total loans were 0.05 percent for the nine months ended Sept. 30, 2006. |
· | Allowance for loan losses represented 1.08 percent of total loans at Sept. 30, 2006, compared to 1.08 percent at June 30, 2006, and 1.21 percent at Dec. 31, 2005. |
o | Nonperforming assets as a percentage of total loans and other real estate increased to 0.25 percent at Sept. 30, 2006, from 0.01 percent at Sept. 30, 2005. |
Pinnacle Reports Record Earnings - 5 of 8
“We remain extremely pleased with the credit quality of our firm,” said Turner. “Both Pinnacle and Cavalry have had excellent asset quality indicators for quite some time. We continue to believe that our asset quality is a key predictor of our ability to create long-term shareholder value.”
REVENUE
· | Net interest income for the quarter ended Sept. 30, 2006, was $17.16 million, compared to $7.46 million for the quarter ended Sept. 30, 2005, an increase of 130 percent. |
o | Net interest margin for the third quarter of 2006 was 3.95 percent, compared to a net interest margin of 4.17 percent reported for the second quarter of 2006 and 3.48 percent for the same period last year. |
· | Noninterest income for the quarter ended Sept. 30, 2006, was $4.42 million, a 240 percent increase over the $1.30 million recorded during the same quarter in 2005. |
“Consistent with our prior guidance of 3.90 percent to 4.10 percent, we anticipated that we would experience compression in our net interest margin in the third quarter,” said Harold Carpenter, chief financial officer of Pinnacle Financial Partners. “The slope of the yield curve and our maintaining more liquidity during the third quarter were the primary contributors to our compressed net interest margin. However, even with compression in our net interest margin, we believe we will experience growth in net interest income over the next few quarters based on anticipated loan growth.”
“Excluding the loans acquired in connection with the Cavalry acquisition in March, our net organic loan growth for the first nine months of this year has approximated $207 million,” Carpenter said. “This amount is consistent with our expectations and represents a 57 percent increase over the combined loan growth of the two companies for the first nine months of 2005, which was also a period of rapid growth for both companies prior to our merger. Our fourth quarter pipeline remains strong and barring any unplanned year-end pay downs, our current projections indicate our net loan growth for the fourth quarter will be consistent with our quarterly run rate of $50 million to $70 million.”
Pinnacle Reports Record Earnings - 6 of 8
Noninterest income during the third quarter of 2006 represented approximately 20.5 percent of total revenues, compared to 14.8 percent for the same quarter in 2005.
NONINTEREST EXPENSE
· | Noninterest expense for the quarter ended Sept. 30, 2006, was $13.05 million. |
· | Merger related expenses incurred during the quarter ended Sept. 30, 2006, were $218,000. These charges consisted of direct and incremental integration costs incurred in connection with the merger. For the nine months ended Sept. 30, 2006, merger related expenses were approximately $1.6 million. |
· | During the quarter ended Sept. 30, 2006, Pinnacle recognized compensation expense related to the expensing of stock options in accordance with Statement of Financial Accounting Standards No. 123R (“SFAS No. 123R”) of approximately $233,000 on an after-tax basis. For the nine months ended Sept. 30, 2006, the after-tax impact of SFAS No. 123R was approximately $591,000. |
· | Amortization expense associated with the core deposit intangible recorded in connection with the merger of Cavalry was $535,000 for the three months ended Sept. 30, 2006, and $1.248 million for the nine months ended Sept. 30, 2006. |
· | The efficiency ratio (noninterest expense divided by net interest income and noninterest income) was 60.5 percent during the third quarter of 2006. The efficiency ratio excluding merger related expenses was 59.5 percent during the third quarter of 2006, compared to 63.1 percent during the third quarter of 2005. |
Pinnacle anticipates the opening of its new office in the Donelson area of Davidson County in early 2007. At Sept. 30, 2006, the firm employed 395.5 associates (full-time equivalent). Pinnacle anticipates adding 20 new associates during the fourth quarter of 2006.
PROGRESS OF THE CAVALRY INTEGRATION
On Oct. 3, 2005, Pinnacle reported that the firm had entered into a definitive agreement to acquire the common stock of Cavalry Bancorp, a one-bank holding company in
Pinnacle Reports Record Earnings - 7 of 8
Murfreesboro, Tenn. During December 2005, the shareholders of both Pinnacle and Cavalry voted to approve the merger. During the first quarter of 2006, all regulatory approvals were obtained and the merger was consummated on March 15, 2006.
Assessing the merger integration, Turner said, “We believe that our integration of Cavalry has been extraordinarily successful based on our four key measures of success:
1. | We achieved all major integration milestones on schedule (e.g., system conversions, brand conversions, etc.); |
2. | We achieved 100 percent of the targeted expense savings; |
3. | We have seen no degradation in client satisfaction with bank service quality during the entire integration as evidenced by our long-standing client survey methodology; and |
4. | We have produced greater organic growth in the combined footprint in terms of loan and deposit volumes during the first nine months of 2006 than the two companies were able to produce on a combined basis in the first nine months of 2005.” |
INVESTMENT OUTLOOK
Management has developed several financial forecast scenarios for the next several quarters. Based on anticipated growth trends and future investments in the franchise, Pinnacle estimates its fourth quarter 2006 diluted earnings per share will approximate $0.33 to $0.35. The firm does not anticipate merger-related charges to be significant in the fourth quarter of 2006. Additionally, based on anticipated growth trends and future investments in the franchise, Pinnacle estimates its 2006 earnings will approximate $1.17 to $1.19 per fully diluted share and approximately $1.23 to $1.25 per fully diluted share, exclusive of merger-related expenses. For 2007, Pinnacle continues to estimate that its earnings will approximate $1.50 to $1.57 per fully diluted share.
As noted previously, management has developed several scenarios under which these estimates can be achieved and believes these estimates to be reasonable based on these scenarios. However, unanticipated events or developments including the execution of any initiative involving the development of any market other than the current Nashville-Davidson-
Pinnacle Reports Record Earnings - 8 of 8
Murfreesboro MSA, the opportunity to hire more seasoned professionals than anticipated or the ability to grow loans significantly in excess of the levels contemplated may cause the actual results of Pinnacle to differ materially from these estimates.
Pinnacle Financial Partners provides a full range of banking, investment and insurance products and services designed for small- to mid-sized businesses and their owners, real estate professionals and individuals interested in a deep relationship with their financial institution. Pinnacle provides financial planning services and comprehensive wealth management services to help clients increase, protect and distribute their assets. The firm also has a well-established expertise in commercial real estate.
Pinnacle opened its first office in October 2000. Since then the firm has added seven other offices on a denovo basis and acquired Cavalry Bancorp with its nine offices bringing the total number of offices to 17 in the most attractive trade areas in the Nashville-Davidson-Murfreesboro MSA.
Additional information concerning Pinnacle can be accessed at www.pnfp.com.
###
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," "intend," "plan," "believe," "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 facts that may cause the actual results, performance or achievements of Pinnacle to differ materially from any results expressed or implied by such forward-looking statements. Such factors include, without limitation, (i) unanticipated deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses, (ii) the inability of Pinnacle to continue to grow its loan portfolio at historic rates, (iii) increased competition with other financial institutions, (iv) lack of sustained growth in the economy in the Nashville-Davidson-Murfreesboro MSA, (v) rapid fluctuations or unanticipated changes in interest rates, (vi) the inability of Pinnacle to satisfy regulatory requirements for its expansion plans, (vii) the inability of Pinnacle to execute its expansion plans, (viii) the inability of Pinnacle to successfully integrate the former Cavalry Bancorp's operations with Pinnacle's and (ix) changes in the legislative and regulatory environment. A more detailed description of these and other risks is contained in Pinnacle's most recent annual report on Form 10-K. Many of such factors are beyond Pinnacle's ability to control or predict, and readers are cautioned not to put undue reliance on such forward-looking statements. Pinnacle 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.
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | |||||||
CONSOLIDATED BALANCE SHEETS – UNAUDITED | |||||||
September 30, 2006 | December 31, 2005 | ||||||
ASSETS | |||||||
Cash and noninterest-bearing due from banks | $ | 55,199,117 | $ | 25,935,948 | |||
Interest-bearing due from banks | 6,176,891 | 839,960 | |||||
Federal funds sold | 51,623,544 | 31,878,362 | |||||
Cash and cash equivalents | 112,999,552 | 58,654,270 | |||||
Securities available-for-sale, at fair value | 303,483,224 | 251,749,094 | |||||
Securities held-to-maturity (fair value of $26,531,147 and $26,546,297 at September 30, 2006 and December 31, 2005, respectively) | 27,275,651 | 27,331,251 | |||||
Mortgage loans held-for-sale | 8,960,447 | 4,874,323 | |||||
Loans | 1,405,401,429 | 648,024,032 | |||||
Less allowance for loan losses | (15,172,446 | ) | (7,857,774 | ) | |||
Loans, net | 1,390,228,983 | 640,166,258 | |||||
Premises and equipment, net | 36,222,088 | 12,915,595 | |||||
Investments in unconsolidated subsidiaries and other entities | 11,278,614 | 6,622,645 | |||||
Accrued interest receivable | 10,455,981 | 4,870,197 | |||||
Goodwill | 115,064,500 | - | |||||
Core deposit intangible | 11,920,001 | - | |||||
Other assets | 24,363,133 | 9,588,097 | |||||
Total assets | $ | 2,052,252,174 | $ | 1,016,771,730 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Deposits: | |||||||
Noninterest-bearing demand | $ | 306,296,117 | $ | 155,811,214 | |||
Interest-bearing demand | 199,967,210 | 72,520,757 | |||||
Savings and money market accounts | 481,684,245 | 304,161,625 | |||||
Time | 597,290,358 | 277,657,129 | |||||
Total deposits | 1,585,237,930 | 810,150,725 | |||||
Securities sold under agreements to repurchase | 122,354,264 | 65,834,232 | |||||
Federal Home Loan Bank advances | 28,739,443 | 41,500,000 | |||||
Subordinated debt | 51,548,000 | 30,929,000 | |||||
Accrued interest payable | 4,183,121 | 1,884,596 | |||||
Other liabilities | 11,130,028 | 3,036,752 | |||||
Total liabilities | 1,803,192,786 | 953,335,305 | |||||
Stockholders’ equity: | |||||||
Preferred stock, no par value; 10,000,000 shares authorized; no shares issued and outstanding | - | - | |||||
Common stock, par value $1.00; 90,000,000 shares authorized; 15,409,341 issued and outstanding at September 30, 2006 and 8,426,551 issued and outstanding at December 31, 2005 | 15,409,341 | 8,426,551 | |||||
Additional paid-in capital | 210,752,785 | 44,890,912 | |||||
Unearned compensation | 0 | (169,689 | ) | ||||
Retained earnings | 25,455,618 | 13,182,291 | |||||
Accumulated other comprehensive income (loss), net | (2,558,356 | ) | (2,893,640 | ) | |||
Stockholders’ equity | 249,059,388 | 63,436,425 | |||||
Total liabilities and stockholders’ equity | $ | 2,052,252,174 | $ | 1,016,771,730 |
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | |||||||||||||
CONSOLIDATED STATEMENTS OF INCOME – UNAUDITED | |||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||
September 30 | September 30 | ||||||||||||
2006 | 2005 | 2006 | 2005 | ||||||||||
Interest income: | |||||||||||||
Loans, including fees | $ | 26,771,110 | $ | 9,470,954 | $ | 64,195,835 | $ | 24,427,821 | |||||
Securities: | |||||||||||||
Taxable | 3,240,878 | 2,245,019 | 9,250,455 | 6,401,537 | |||||||||
Tax-exempt | 521,240 | 318,235 | 1,416,862 | 758,572 | |||||||||
Federal funds sold and other | 806,829 | 344,498 | 1,591,941 | 601,468 | |||||||||
Total interest income | 31,340,057 | 12,378,706 | 76,455,093 | 32,189,398 | |||||||||
Interest expense: | |||||||||||||
Deposits | 11,800,394 | 3,968,648 | 27,213,738 | 8,999,838 | |||||||||
Securities sold under agreements to repurchase | 1,382,418 | 399,731 | 2,569,383 | 803,114 | |||||||||
Federal funds purchased and other borrowings | 997,899 | 554,694 | 3,110,660 | 1,635,506 | |||||||||
Total interest expense | 14,180,711 | 4,923,073 | 32,893,781 | 11,438,458 | |||||||||
Net interest income | 17,159,346 | 7,455,633 | 43,561,312 | 20,750,940 | |||||||||
Provision for loan losses | 586,589 | 366,304 | 2,680,638 | 1,450,244 | |||||||||
Net interest income after provision for loan losses | 16,572,757 | 7,089,329 | 40,880,674 | 19,300,696 | |||||||||
Noninterest income: | |||||||||||||
Service charges on deposit accounts | 1,357,280 | 228,994 | 3,151,664 | 732,130 | |||||||||
Investment sales commissions | 644,931 | 474,354 | 1,811,428 | 1,403,231 | |||||||||
Insurance sales commissions | 549,584 | - | 1,562,946 | - | |||||||||
Gain on loans and loan participations sold, net | 490,254 | 348,577 | 1,285,609 | 899,393 | |||||||||
Trust fees | 311,997 | - | 675,994 | - | |||||||||
Gain on sales of investment securities, net | - | - | - | 114,410 | |||||||||
Other noninterest income | 1,069,811 | 247,208 | 2,364,592 | 743,689 | |||||||||
Total noninterest income | 4,423,857 | 1,299,133 | 10,852,233 | 3,892,853 | |||||||||
Noninterest expense: | |||||||||||||
Compensation and employee benefits | 7,576,011 | 3,410,436 | 19,314,365 | 9,491,712 | |||||||||
Equipment and occupancy | 2,070,727 | 1,034,661 | 5,325,274 | 2,712,624 | |||||||||
Marketing and other business development | 351,432 | 186,430 | 899,807 | 479,313 | |||||||||
Postage and supplies | 487,689 | 159,782 | 1,118,308 | 453,716 | |||||||||
Amortization of core deposit intangible | 534,957 | - | 1,248,335 | - | |||||||||
Other noninterest expense | 1,815,392 | 729,528 | 3,999,832 | 1,927,564 | |||||||||
Merger related expense | 218,167 | - | 1,582,734 | - | |||||||||
Total noninterest expense | 13,054,375 | 5,520,837 | 33,488,655 | 15,064,929 | |||||||||
Income before income taxes | 7,942,239 | 2,867,625 | 18,244,252 | 8,128,620 | |||||||||
Income tax expense | 2,595,465 | 789,382 | 5,963,112 | 2,311,455 | |||||||||
Net income | $ | 5,346,774 | $ | 2,078,243 | $ | 12,281,140 | $ | 5,817,165 | |||||
Per share information: | |||||||||||||
Basic net income per common share | $ | 0.35 | $ | 0.25 | $ | 0.91 | $ | 0.69 | |||||
Diluted net income per common share | $ | 0.32 | $ | 0.22 | $ | 0.84 | $ | 0.62 | |||||
Weighted average shares outstanding: | |||||||||||||
Basic | 15,393,735 | 8,417,980 | 13,450,282 | 8,402,916 | |||||||||
Diluted | 16,655,349 | 9,495,187 | 14,649,418 | 9,455,756 |
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | |||||||||||||||||||
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED | |||||||||||||||||||
Three months ended | Three months ended | ||||||||||||||||||
(dollars in thousands) | September 30, 2006 | September 30, 2005 | |||||||||||||||||
Average Balances | Interest | Rates/ Yields | Average Balances | Interest | Rates/ Yields | ||||||||||||||
Interest-earning assets: | |||||||||||||||||||
Loans | $ | 1,375,036 | $ | 26,771 | 7.72 | % | $ | 587,902 | $ | 9,471 | 6.40 | % | |||||||
Securities: | |||||||||||||||||||
Taxable | 260,688 | 3,241 | 4.93 | % | 205,213 | 2,245 | 4.34 | % | |||||||||||
Tax-exempt (1) | 56,644 | 521 | 4.81 | % | 35,312 | 318 | 4.72 | % | |||||||||||
Federal funds sold | 51,075 | 685 | 5.32 | % | 34,204 | 282 | 3.27 | % | |||||||||||
Other | 8,116 | 122 | 7.16 | % | 4,075 | 63 | 7.02 | % | |||||||||||
Total interest-earning assets | 1,751,559 | $ | 31,340 | 7.14 | % | 866,706 | $ | 12,379 | 5.73 | % | |||||||||
Nonearning assets | 235,677 | 48,095 | |||||||||||||||||
Total assets | $ | 1,987,236 | $ | 914,801 | |||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||
Interest bearing deposits | |||||||||||||||||||
Interest checking | $ | 181,752 | $ | 1,202 | 2.62 | % | $ | 64,369 | $ | 242 | 1.49 | % | |||||||
Savings and money market | 473,883 | 3,809 | 3.19 | % | 266,327 | 1,408 | 2.10 | % | |||||||||||
Certificates of deposit | 598,220 | 6,789 | 4.50 | % | 274,303 | 2,319 | 3.35 | % | |||||||||||
Total deposits | 1,253,855 | 11,800 | 3.73 | % | 604,999 | 3,969 | 2.60 | % | |||||||||||
Securities sold under agreements to repurchase | 122,292 | 1,382 | 4.49 | % | 63,337 | 400 | 2.50 | % | |||||||||||
Federal funds purchased | - | - | 0.00 | % | - | - | 0.00 | % | |||||||||||
Federal Home Loan Bank advances | 33,299 | 383 | 4.57 | % | 41,456 | 336 | 3.22 | % | |||||||||||
Subordinated debt | 36,084 | 615 | 6.75 | % | 13,896 | 218 | 6.22 | % | |||||||||||
Total interest-bearing liabilities | 1,445,530 | 14,180 | 3.89 | % | 723,688 | 4,923 | 2.72 | % | |||||||||||
Noninterest-bearing deposits | 281,812 | - | - | 125,447 | - | 0 | |||||||||||||
Total deposits and interest-bearing liabilities | 1,727,342 | $ | 14,180 | 3.26 | % | 849,135 | $ | 4,923 | 2.30 | % | |||||||||
Other liabilities | 14,914 | 3,328 | |||||||||||||||||
Stockholders' equity | 244,980 | 62,338 | |||||||||||||||||
$ | 1,987,236 | $ | 914,801 | ||||||||||||||||
Net interest income | $ | 17,160 | $ | 7,456 | |||||||||||||||
Net interest spread (2) | 3.25 | % | 3.01 | % | |||||||||||||||
Net interest margin (3) | 3.95 | % | 3.48 | % |
(1) Yields computed on tax-exempt instruments on a tax equivalent basis.
(2) Yields realized on interest-earning assets less the rates paid on interest-bearing liabilities.
(3) Net interest margin is the result of annualized net interest income divided by average interest-earning assets for the period.
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | |||||||||||||||||||
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED | |||||||||||||||||||
Nine months ended | Nine months ended | ||||||||||||||||||
(dollars in thousands) | September 30, 2006 | September 30, 2005 | |||||||||||||||||
Average Balances | Interest | Rates/ Yields | Average Balances | Interest | Rates/ Yields | ||||||||||||||
Interest-earning assets: | |||||||||||||||||||
Loans | $ | 1,154,828 | $ | 64,196 | 7.43 | % | $ | 537,842 | $ | 24,428 | 6.08 | % | |||||||
Securities: | |||||||||||||||||||
Taxable | 250,373 | 9,250 | 4.94 | % | 194,993 | 6,401 | 4.39 | % | |||||||||||
Tax-exempt (1) | 50,481 | 1,417 | 4.95 | % | 28,657 | 758 | 4.67 | % | |||||||||||
Federal funds sold | 30,103 | 1,225 | 5.44 | % | 19,311 | 436 | 3.02 | % | |||||||||||
Other | 7,017 | 367 | 7.95 | % | 3,694 | 166 | 6.92 | % | |||||||||||
Total interest-earning assets | 1,492,802 | $ | 76,455 | 6.89 | % | 784,497 | $ | 32,189 | 5.53 | % | |||||||||
Nonearning assets | 180,522 | 46,846 | |||||||||||||||||
Total assets | $ | 1,673,324 | $ | 831,343 | |||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||
Interest bearing deposits | |||||||||||||||||||
Interest checking | $ | 158,643 | $ | 2,532 | 2.13 | % | $ | 59,919 | $ | 403 | 0.90 | % | |||||||
Savings and money market | 417,610 | 9,384 | 3.00 | % | 235,697 | 3,012 | 1.71 | % | |||||||||||
Certificates of deposit | 486,642 | 15,298 | 4.20 | % | 247,773 | 5,585 | 3.01 | % | |||||||||||
Total deposits | 1,062,895 | 27,214 | 3.42 | % | 543,389 | 9,000 | 2.21 | % | |||||||||||
Securities sold under agreements to repurchase | 83,364 | 2,569 | 4.12 | % | 50,456 | 803 | 2.13 | % | |||||||||||
Federal funds purchased | 41,351 | 52 | 5.11 | % | 1,796 | 45 | 3.31 | % | |||||||||||
Federal Home Loan Bank advances | 32,647 | 1,443 | 4.66 | % | 48,880 | 1,084 | 2.97 | % | |||||||||||
Subordinated debt | 1,358 | 1,615 | 6.62 | % | 11,506 | 506 | 5.89 | % | |||||||||||
Total interest-bearing liabilities | 1,221,615 | 32,893 | 3.60 | % | 656,027 | 11,438 | 2.33 | % | |||||||||||
Noninterest-bearing deposits | �� | 248,448 | - | - | 112,771 | - | - | ||||||||||||
Total deposits and interest-bearing liabilities | 1,470,063 | $ | 32,893 | 2.99 | % | 768,798 | $ | 11,438 | 1.99 | % | |||||||||
Other liabilities | 11,623 | 2,436 | |||||||||||||||||
Stockholders' equity | 191,638 | 60,109 | |||||||||||||||||
$ | 1,673,324 | $ | 831,343 | ||||||||||||||||
Net interest income | $ | 43,562 | $ | 20,751 | |||||||||||||||
Net interest spread (2) | 3.29 | % | 3.20 | % | |||||||||||||||
Net interest margin (3) | 3.97 | % | 3.60 | % |
(1) Yields computed on tax-exempt instruments on a tax equivalent basis. |
(2) Yields realized on interest-earning assets less the rates paid on interest-bearing liabilities. |
(3) Net interest margin is the result of annualized net interest income divided by average interest-earning assets for the period. |
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | |||||||||||||||||||
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED | |||||||||||||||||||
Sept | Jun | Mar | Dec | Sept | June | ||||||||||||||
(dollars in thousands, except per share data) | 2006 | 2006 | 2006 | 2005 | 2005 | 2005 | |||||||||||||
Balance sheet data, at quarter end: | |||||||||||||||||||
Total assets | $ | 2,052,252 | 1,985,625 | 1,828,212 | 1,016,772 | 978,539 | 872,076 | ||||||||||||
Total loans | 1,405,401 | 1,358,273 | 1,235,170 | 648,024 | 604,225 | 556,786 | |||||||||||||
Allowance for loan losses | (15,172 | ) | (14,686 | ) | (13,354 | ) | (7,858 | ) | (7,231 | ) | (6,659 | ) | |||||||
Securities | 330,759 | 305,642 | 315,473 | 279,080 | 246,914 | 227,938 | |||||||||||||
Noninterest-bearing deposits | 306,296 | 312,709 | 263,701 | 155,811 | 154,440 | 142,794 | |||||||||||||
Total deposits | 1,585,238 | 1,559,885 | 1,415,778 | 810,151 | 788,628 | 689,919 | |||||||||||||
Securities sold under agreements to repurchase | 122,354 | 104,380 | 63,912 | 65,834 | 67,652 | 57,677 | |||||||||||||
Advances from FHLB | 28,739 | 33,749 | 67,267 | 41,500 | 24,500 | 49,500 | |||||||||||||
Subordinated debt | 51,548 | 30,929 | 30,929 | 30,929 | 30,929 | 10,310 | |||||||||||||
Total stockholders’ equity | 249,059 | 238,739 | 236,327 | 63,436 | 62,883 | 61,501 | |||||||||||||
Balance sheet data, quarterly averages: | |||||||||||||||||||
Total assets | $ | 1,987,236 | 1,878,912 | 1,153,823 | 986,106 | 914,801 | 822,344 | ||||||||||||
Total loans | 1,375,036 | 1,328,121 | 761,326 | 634,175 | 587,902 | 537,313 | |||||||||||||
Securities | 317,332 | 298,909 | 286,321 | 273,487 | 240,525 | 222,172 | |||||||||||||
Total earning assets | 1,751,559 | 1,651,962 | 1,074,885 | 937,357 | 866,706 | 778,094 | |||||||||||||
Noninterest-bearing deposits | 281,812 | 311,286 | 152,247 | 136,143 | 125,447 | 111,937 | |||||||||||||
Total deposits | 1,535,667 | 1,482,150 | 763,967 | 796,792 | 730,446 | 640,676 | |||||||||||||
Securities sold under agreements to repurchase | 122,292 | 68,079 | 59,723 | 67,874 | 63,337 | 49,883 | |||||||||||||
Advances from FHLB | 33,299 | 44,417 | 46,336 | 22,663 | 41,456 | 54,951 | |||||||||||||
Subordinated debt | 36,084 | 30,929 | 30,929 | 30,929 | 13,896 | 10,310 | |||||||||||||
Total stockholders’ equity | 244,980 | 234,400 | 95,535 | 63,199 | 62,338 | 59,569 | |||||||||||||
Statement of operations data, for the three months ended: | |||||||||||||||||||
Interest income | $ | 31,340 | 28,305 | 16,811 | 14,118 | 12,378 | 10,544 | ||||||||||||
Interest expense | 14,181 | 11,410 | 7,304 | 5,831 | 4,923 | 3,749 | |||||||||||||
Net interest income | 17,159 | 16,895 | 9,507 | 8,287 | 7,455 | 6,795 | |||||||||||||
Provision for loan losses | 587 | 1,707 | 387 | 702 | 366 | 483 | |||||||||||||
Net interest income after provision for loan losses | 16,572 | 15,188 | 9,120 | 7,585 | 7,089 | 6,312 | |||||||||||||
Noninterest income | 4,424 | 4,380 | 2,048 | 1,501 | 1,299 | 1,413 | |||||||||||||
Noninterest expense | 13,054 | 13,105 | 7,329 | 5,967 | 5,521 | 4,963 | |||||||||||||
Income before taxes | 7,942 | 6,463 | 3,839 | 3,119 | 2,867 | 2,762 | |||||||||||||
Income tax expense | 2,595 | 2,141 | 1,227 | 881 | 789 | 803 | |||||||||||||
Net income | $ | 5,347 | 4,322 | 2,612 | 2,238 | 2,078 | 1,959 | ||||||||||||
Profitability and other ratios: | |||||||||||||||||||
Return on avg. assets (1) | 1.07 | % | 0.92 | % | 0.92 | % | 0.90 | % | 0.91 | % | 0.96 | % | |||||||
Return on avg. equity (1) | 8.66 | % | 7.40 | % | 11.09 | % | 14.05 | % | 13.23 | % | 13.21 | % | |||||||
Net interest margin (2) | 3.95 | % | 4.17 | % | 3.65 | % | 3.58 | % | 3.48 | % | 3.57 | % | |||||||
Noninterest income to total revenue (3) | 20.50 | % | 20.60 | % | 17.70 | % | 15.30 | % | 14.80 | % | 17.20 | % | |||||||
Noninterest income to avg. assets (1) | 0.89 | % | 0.94 | % | 0.72 | % | 0.60 | % | 0.56 | % | 0.69 | % | |||||||
Noninterest exp. to avg. assets (1) | 2.63 | % | 2.80 | % | 2.58 | % | 2.40 | % | 2.39 | % | 2.42 | % | |||||||
Efficiency ratio (4) | 60.50 | % | 61.60 | % | 63.40 | % | 61.00 | % | 63.10 | % | 60.40 | % | |||||||
Avg. loans to average deposits | 89.50 | % | 89.60 | % | 83.10 | % | 79.70 | % | 80.50 | % | 83.90 | % | |||||||
Securities to total assets | 16.10 | % | 15.40 | % | 17.30 | % | 27.40 | % | 25.20 | % | 26.10 | % | |||||||
Average interest-earning assets to average interest-bearing liabilities | 121.20 | % | 125.30 | % | 119.30 | % | 117.70 | % | 119.80 | % | 120.00 | % | |||||||
Brokered time deposits to total deposits | 4.50 | % | 5.00 | % | 3.30 | % | 6.60 | % | 7.20 | % | 8.60 | % |
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | |||||||||||||||||||
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED | |||||||||||||||||||
Sept | Jun | Mar | Dec | Sept | June | ||||||||||||||
(dollars in thousands, except per share data) | 2006 | 2006 | 2006 | 2005 | 2005 | 2005 | |||||||||||||
Selected growth rates, last twelve months (5): | |||||||||||||||||||
Total average assets | 117.20 | % | 128.50 | % | 52.40 | % | 39.50 | % | 47.90 | % | 48.60 | % | |||||||
Average loans | 133.90 | % | 147.20 | % | 55.90 | % | 41.50 | % | 49.90 | % | 56.20 | % | |||||||
Total average deposits | 110.20 | % | 131.30 | % | 53.90 | % | 41.50 | % | 50.50 | % | 46.30 | % | |||||||
Total revenue (3) | 146.50 | % | 159.10 | % | 50.40 | % | 30.10 | % | 27.00 | % | 46.60 | % | |||||||
Total noninterest expense | 136.40 | % | 164.00 | % | 60.00 | % | 44.60 | % | 40.90 | % | 41.90 | % | |||||||
Diluted earnings per share | 45.50 | % | 23.80 | % | 26.30 | % | 33.30 | % | 37.50 | % | 50.00 | % | |||||||
Loan portfolio balances, end of period: | |||||||||||||||||||
Commercial real estate - mortgage | $ | 265,174 | 260,168 | 246,391 | 148,102 | 141,310 | 126,436 | ||||||||||||
Commercial real estate - construction | 152,627 | 164,049 | 162,867 | 30,295 | 29,942 | 29,954 | |||||||||||||
Other commercial loans | 554,617 | 503,797 | 410,059 | 239,129 | 225,525 | 214,209 | |||||||||||||
Consumer real estate - mortgage | 292,206 | 294,119 | 283,590 | 169,953 | 160,975 | 157,819 | |||||||||||||
Consumer real estate - construction | 87,890 | 86,978 | 84,381 | 37,372 | 28,611 | 9,218 | |||||||||||||
Other consumer loans | 52,887 | 49,162 | 47,882 | 23,173 | 17,862 | 19,150 | |||||||||||||
Asset quality information and ratios: | |||||||||||||||||||
Nonaccrual loans and other real estate | $ | 3,477 | 2,867 | 1,201 | 460 | 61 | 596 | ||||||||||||
Past due loans over 90 days and still accruing interest | $ | 1,123 | 492 | - | - | 8 | 66 | ||||||||||||
Net loan charge-offs (recoveries) (6) | $ | 101 | 441 | (73 | ) | 76 | (206 | ) | 22 | ||||||||||
Allowance for loan losses to total loans | 1.08 | % | 1.08 | % | 1.08 | % | 1.21 | % | 1.20 | % | 1.20 | % | |||||||
As a percentage of total loans and ORE: | |||||||||||||||||||
Past due loans over 30 days | 0.69 | % | 0.25 | % | 0.52 | % | 0.58 | % | 0.10 | % | 0.21 | % | |||||||
Nonperforming assets | 0.25 | % | 0.21 | % | 0.10 | % | 0.07 | % | 0.01 | % | 0.11 | % | |||||||
Potential problem loans (7) | 0.77 | % | 0.31 | % | 0.63 | % | 0.20 | % | 0.37 | % | 0.18 | % | |||||||
Annualized net loan charge-offs (recoveries) to avg. loans (8) | 0.05 | % | 0.07 | % | (0.04 | )% | (0.01 | )% | (0.03 | )% | 0.02 | % | |||||||
Avg. commercial loan internal risk ratings (7) | 4.1 | 4.1 | 4.1 | 3.8 | 3.9 | 3.8 | |||||||||||||
Avg. loan account balances (9) | $ | 132 | 115 | 105 | 180 | 172 | 171 | ||||||||||||
Interest rates and yields: | |||||||||||||||||||
Loans | 7.72 | % | 7.32 | % | 7.02 | % | 6.72 | % | 6.40 | % | 5.98 | % | |||||||
Securities | 4.91 | % | 5.10 | % | 4.80 | % | 4.58 | % | 4.40 | % | 4.42 | % | |||||||
Federal funds sold and other | 5.40 | % | 7.09 | % | 5.54 | % | 4.83 | % | 3.72 | % | 3.90 | % | |||||||
Total earning assets | 7.14 | % | 6.92 | % | 6.39 | % | 6.03 | % | 5.73 | % | 5.48 | % | |||||||
Total deposits, including non-interest bearing | 3.05 | % | 2.59 | % | 2.59 | % | 2.34 | % | 2.16 | % | 1.80 | % | |||||||
Securities sold under agreements to repurchase | 4.49 | % | 4.00 | % | 3.46 | % | 2.99 | % | 2.50 | % | 2.04 | % | |||||||
Federal funds purchased and FHLB advances | 4.57 | % | 5.46 | % | 3.99 | % | 2.50 | % | 3.22 | % | 3.12 | % | |||||||
Subordinated debt | 6.75 | % | 6.69 | % | 6.36 | % | 6.14 | % | 6.22 | % | 5.98 | % | |||||||
Total deposits and interest-bearing liabilities | 3.26 | % | 2.81 | % | 2.81 | % | 2.52 | % | 2.30 | % | 1.98 | % |
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | |||||||||||||||||||
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED | |||||||||||||||||||
Sept | Jun | Mar | Dec | Sept | June | ||||||||||||||
(dollars in thousands, except per share data) | 2006 | 2006 | 2006 | 2005 | 2005 | 2005 | |||||||||||||
Per share data: | |||||||||||||||||||
Earnings – basic | $ | 0.35 | 0.28 | 0.27 | 0.27 | 0.25 | 0.23 | ||||||||||||
Earnings – diluted | $ | 0.32 | 0.26 | 0.24 | 0.24 | 0.22 | 0.21 | ||||||||||||
Book value at quarter end (10) | $ | 16.16 | 15.53 | 15.45 | 7.53 | 7.47 | 7.32 | ||||||||||||
Weighted avg. shares – basic | 15,393,735 | 15,335,754 | 9,578,813 | 8,425,717 | 8,417,980 | 8,401,198 | |||||||||||||
Weighted avg. shares – diluted | 16,655,349 | 16,503,692 | 10,745,626 | 9,490,447 | 9,495,187 | 9,434,260 | |||||||||||||
Common shares outstanding | 15,409,341 | 15,370,116 | 15,300,629 | 8,426,551 | 8,424,217 | 8,405,891 | |||||||||||||
Capital ratios (11): | |||||||||||||||||||
Stockholders’ equity to total assets | 12.1 | % | 12.0 | % | 12.9 | % | 6.2 | % | 6.4 | % | 7.1 | % | |||||||
Leverage | 9.2 | % | 8.0 | % | 14.7 | % | 9.3 | % | 9.3 | % | 8.8 | % | |||||||
Tier one risk-based | 10.6 | % | 9.5 | % | 10.4 | % | 11.0 | % | 10.9 | % | 10.0 | % | |||||||
Total risk-based | 12.0 | % | 10.4 | % | 11.9 | % | 11.9 | % | 13.0 | % | 10.9 | % | |||||||
Investor information: | |||||||||||||||||||
Closing sales price | $ | 35.80 | 30.43 | 27.44 | 24.98 | 25.18 | 24.00 | ||||||||||||
High sales price during quarter | $ | 37.41 | 30.92 | 28.84 | 25.96 | 26.65 | 25.14 | ||||||||||||
Low sales price during quarter | $ | 28.93 | 27.09 | 24.87 | 21.70 | 22.67 | 20.50 | ||||||||||||
Other information: | |||||||||||||||||||
Gains (losses) on sale of loans and loan participations sold: | |||||||||||||||||||
Mortgage loan originations: | |||||||||||||||||||
Gross loans originated | $ | 40,816 | 40,862 | 24,034 | 31,792 | 31,066 | 27,239 | ||||||||||||
Gross fees (12) | $ | 679 | 668 | 389 | 485 | 533 | 419 | ||||||||||||
Gross fees as a percentage of mortgage loans originated | 1.66 | % | 1.63 | % | 1.62 | % | 1.53 | % | 1.72 | % | 1.54 | % | |||||||
Commercial loan participations sold | $ | 31 | 49 | 74 | 41 | (26 | ) | 152 | |||||||||||
Gains on sales of investment securities, net | - | - | - | - | - | - | |||||||||||||
Brokerage account assets, at quarter-end (13) | $ | 553,000 | 501,000 | 470,000 | 441,000 | 428,000 | 419,000 | ||||||||||||
Floating rate loans as a percentage of loans (14) | 47.3 | % | 47.0 | % | 48.5 | % | 53.5 | % | 56.2 | % | 55.9 | % | |||||||
Balance of commercial loan participations sold to other banks and serviced by Pinnacle, at quarter end | $ | 85,291 | 80,359 | 73,171 | 60,282 | 55,257 | 62,034 | ||||||||||||
Core deposits to total funding (15) | 63.70 | % | 63.80 | % | 68.10 | % | 59.50 | % | 60.70 | % | 57.30 | % | |||||||
Total assets per full-time equivalent employee | $ | 5,189 | 5,531 | 4,968 | 6,498 | 6,396 | 5,952 | ||||||||||||
Annualized revenues per full-time equivalent employee | $ | 218.3 | 237.0 | 205.0 | 250.2 | 228.9 | 227.0 | ||||||||||||
Number of employees (full-time equivalent) | 395.5 | 359.0 | 368.0 | 156.5 | 153.0 | 146.5 | |||||||||||||
Associate retention rate (16) | 91.1 | % | 94.7 | % | 93.2 | % | 94.3 | % | 95.5 | % | 96.6 | % |
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | |||||||||||||
SELECTED QUARTERLY AND YEAR-TO-DATE FINANCIAL DATA – UNAUDITED | |||||||||||||
As of September 30, | As of December 31, | ||||||||||||
(dollars in thousands, except per share data) | 2006 | 2005 | |||||||||||
Reconciliation of Non-GAAP measures: | |||||||||||||
Tangible assets: | |||||||||||||
Total assets | $ | 2,052,252 | $ | 1,016,772 | |||||||||
Less: Goodwill | (115,065 | ) | - | ||||||||||
Core deposit intangible | (11,920 | ) | - | ||||||||||
Net tangible assets | $ | 1,925,267 | $ | 1,016,772 | |||||||||
Tangible equity: | |||||||||||||
Total stockholders’ equity | $ | 249,059 | $ | 63,436 | |||||||||
Less: Goodwill | (115,065 | ) | - | ||||||||||
Core deposit intangible | (11,920 | ) | - | ||||||||||
Net tangible equity | $ | 122,074 | $ | 63,436 | |||||||||
Tangible equity divided by tangible assets | 6.34 | % | 6.24 | % | |||||||||
Tangible equity per common share | $ | 7.92 | $ | 7.53 | |||||||||
For the three months ended September 30, | For the nine months ended September 30, | ||||||||||||
(dollars in thousands, except per share data) | 2006 | 2005 | 2006 | 2005 | |||||||||
Average tangible assets: | |||||||||||||
Total average assets | $ | 1,987,236 | $ | 914,801 | $ | 1,673,324 | $ | 831,343 | |||||
Less: Average goodwill | (113,683 | ) | - | (82,893 | ) | - | |||||||
Average core deposit intangible | (12,265 | ) | - | (9,076 | ) | - | |||||||
Net average tangible assets | $ | 1,861,288 | $ | 914,801 | $ | 1,581,355 | $ | 831,343 | |||||
Average tangible equity: | |||||||||||||
Total average stockholders’ equity | $ | 244,980 | $ | 62,338 | $ | 191,638 | $ | 60,109 | |||||
Less: Average goodwill | (113,683 | ) | - | (82,893 | ) | - | |||||||
Average core deposit intangible | (12,265 | ) | - | (9,076 | ) | - | |||||||
Net average tangible stockholders’ equity | $ | 119,032 | $ | 62,338 | $ | 99,669 | $ | 60,109 | |||||
Net income | $ | 5,347 | $ | 2,078 | $ | 12,281 | $ | 5,817 | |||||
Impact of merger related expense, net of tax (17) | 132 | - | 962 | - | |||||||||
Net income before impact of merger related expense | $ | 5,479 | $ | 2,078 | $ | 13,243 | $ | 5,817 | |||||
Fully-diluted earnings per share before impact of merger related expense | $ | 0.33 | $ | 0.22 | $ | 0.90 | $ | 0.62 | |||||
Return on average tangible assets (annualized) | 1.15 | % | 0.91 | % | 1.04 | % | 0.93 | % | |||||
Impact of merger related expense, net of tax (annualized) | 0.03 | % | 0.00 | % | 0.08 | % | 0.00 | % | |||||
Return on average tangible assets before impact of merger related expense (annualized) | 1.18 | % | 0.91 | % | 1.12 | % | 0.93 | % | |||||
Return on average tangible stockholders’ equity (annualized) | 17.97 | % | 13.23 | % | 16.43 | % | 12.90 | % | |||||
Impact of merger related expense, net of tax | 0.45 | % | 0.00 | % | 1.29 | % | 0.00 | % | |||||
Return on average tangible stockholders’ equity before impact of merger related expense (annualized) | 18.41 | % | 13.23 | % | 17.72 | % | 12.90 | % | |||||
Efficiency ratio | 60.5 | % | 63.1 | % | 61.5 | % | 61.1 | % | |||||
Impact of merger related expense | 1.0 | % | 0.0 | % | 2.9 | % | 0.0 | % | |||||
Efficiency ratio before impact of merger related expense | 59.5 | % | 63.1 | % | 58.6 | % | 61.1 | % |
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | |||||||||||||
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED | |||||||||||||
Anticipated Earnings Estimate Ranges | |||||||||||||
Quarter ended December 31, 2006 | Year ended December 31, 2006 | ||||||||||||
Low | High | Low | High | ||||||||||
Projected 2006 EPS Reconciliation Excluding Impact of Merger Related Expense: | |||||||||||||
Estimated diluted earnings per share | $ | 0.33 | $ | 0.35 | $ | 1.17 | $ | 1.19 | |||||
Add: Projected merger related expense | - | - | 0.06 | 0.06 | |||||||||
Adjusted estimated diluted earnings per share to exclude merger related expense | $ | 0.33 | $ | 0.35 | $ | 1.23 | $ | 1.25 |
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. | Growth rates are calculated by dividing amounts for the current quarter by the same quarter of the previous year. |
6. | During the fourth quarter of 2004, the Company incurred two large commercial charge-offs of approximately $850,000 which had been previously on nonaccruing status. During the third quarter of 2005, the Company recorded a recovery of $230,000 related to one of these commercial loans. |
7. | 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 are considered potential problem loans. Potential problem loans do not include nonperforming loans. Generally, consumer loans are not subjected to internal risk ratings. |
8. | 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. |
9. | Computed by dividing the balance of all loans by the number of loan accounts as of the end of each quarter. |
10. | Book value per share computed by dividing total stockholders’ equity by common shares outstanding |
11. | 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. | |
12. | Amounts are included in the statement of income in “Gains on the sale of loans and loan participations sold.” |
13. | At fair value, based on information obtained from Pinnacle’s third party broker/dealer for non-FDIC insured financial products and services. |
14. | 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. |
15. | 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. |
16. | 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 for the Nashville associates and since March 15, 2006 for the Murfreesboro associates by the number of associates employed at quarter-end. |
17. | Represents merger related expenses of $218,000, net of income tax benefit of $86,000 for third quarter of 2006 and merger related expense of $1,583,000, net of income tax benefit of $621,000 for the nine months ended September 30, 2006. |