FOR IMMEDIATE RELEASE
| MEDIA CONTACT: | Nikki Klemmer, 615-743-6132 |
| FINANCIAL CONTACT: | Harold Carpenter, 615-744-3742 |
| WEBSITE: | www.pnfp.com |
PNFP REPORTS FULLY DILUTED EPS UP 20.5% OVER SAME QUARTER LAST YEAR
Return on average assets increases to 1.20 percent
NASHVILLE, Tenn., April 14, 2014 –
Pinnacle Financial Partners, Inc. (Nasdaq/NGS: PNFP) today reported net income per fully diluted common share of $0.47
for the quarter ended March 31, 2014, compared to net income per fully diluted common share of $0.39 for the quarter ended March 31, 2013, an increase of 20.5 percent. "First quarter was another strong quarter of execution against our targets for soundness, profitability and growth," said M. Terry Turner, Pinnacle's president and chief executive officer. "At 0.09 percent, the annualized rate of net charge-offs was back to our pre-recession levels. Our return on average assets of 1.20 percent was an all-time high. Average loans outstanding during the first quarter were also at an all-time high, increasing at an annualized growth rate of approximately 15 percent during the quarter."
GROWING THE CORE EARNINGS CAPACITY OF THE FIRM:
| · | Loans at March 31, 2014 were a record $4.182 billion, an increase of $37.2 million from Dec. 31, 2013, and $409.3 million from March 31, 2013, reflecting year-over-year growth of 10.9 percent. |
| · | Average balances of noninterest bearing deposit accounts were $1.129 billion in the first quarter of 2014, down 4.3 percent from the fourth quarter of 2013 and up 18.5 percent over the same quarter last year. |
| · | Revenues for the quarter ended March 31, 2014 were a record $58.6 million, an increase from $57.5 million in the fourth quarter of 2013 and up 7.3 percent over the $54.7 million for the same quarter last year. |
| · | The firm's net interest margin for the quarter ended March 31, 2014 was 3.76 percent, compared to 3.70 percent in the fourth quarter of 2013 and 3.90 percent for the same quarter last year. |
| · | Return on average assets was 1.20 percent for the first quarter of 2014, compared to 1.09 percent for the same quarter last year. First quarter 2014 return on tangible common equity amounted to 13.47 percent, compared to first quarter 2013 amount of 12.41 percent. |
"Despite the strong growth in average loans outstanding during the quarter, period ending loans for the first quarter of 2014 were up just $37.2 million, less than the average quarterly growth we expect during 2014 but generally in line with our expectations based on historical first quarter performance trends," Turner said. "We continue to believe we will meet or exceed the three-year loan growth targets we established for 2012-2014."
OTHER FIRST QUARTER 2014 HIGHLIGHTS:
| o | Net interest income for the quarter ended March 31, 2014 was $45.9 million, compared to $45.0 million in the fourth quarter of 2013 and $42.8 million for the first quarter of 2013. Net interest income for the first quarter of 2014 was up 7.4 percent year-over-year and is at its highest quarterly level since the firm's founding in 2000. |
| § | Consistent with previously disclosed expectations, the firm's net interest margin increased to 3.76 percent for the quarter ended March 31, 2014, up from 3.70 percent last quarter and down from 3.90 percent for the quarter ended March 31, 2013. |
| o | Noninterest income for the quarter ended March 31, 2014 was $12.7 million, compared to $12.5 million for the fourth quarter of 2013 and $11.9 million for the same quarter last year. Noninterest income was up 7.0 percent over the same quarter last year. |
| § | Wealth management revenues, which include investment services, insurance and trust fees, were $4.7 million during the first quarter of 2014, compared to $4.4 million during the fourth quarter of 2013 and $4.1 million during the same quarter last year. |
| § | Gains on mortgage loans sold, net of commissions, were $952,000 during the first quarter of 2014, compared to $1.1 million during the fourth quarter of 2013 and $1.8 million during the same quarter last year. |
"As anticipated, we experienced an increase in the net interest margin during the first quarter," said Harold R. Carpenter, Pinnacle's chief financial officer. "More importantly, our net interest income and our total revenues were at historic highs. Loan yields appear to be stabilizing, and growth in several fee categories contributed to the record first quarter revenues."
| · | Noninterest and income tax expense |
| o | Noninterest expense for the quarter ended March 31, 2014 was $33.7 million, compared to $32.6 million in the fourth quarter of 2013 and $32.4 million in the same quarter last year. |
| § | Salaries and employee benefits costs were up from the fourth quarter of 2013 by approximately $256,000 and by $2.2 million from the first quarter of 2013. |
| § | Other real estate expenses were $651,000 in the first quarter of 2014, compared to $302,000 in the fourth quarter of 2013 and $721,000 in the same quarter last year. |
| o | Income tax expense was $8.1 million for the first quarter of 2014, compared to $7.3 million in the fourth quarter of 2013 and $6.6 million in the same quarter last year. |
"Excluding other real estate expenses, our first quarter noninterest expense represents an increase of 2.1 percent over our expense amount for the fourth quarter of last year," Carpenter said. "As compared to the fourth quarter of 2013, the ratio of expense (excluding ORE expenses) to average assets rose to 2.43 percent in the first quarter due primarily to seasonal salary adjustments and increases in various other expense categories. Increasing the operating leverage of our firm remains a key objective of our leadership.
"We anticipate our expense base in 2014 will increase as we continue to recruit relationship managers and other professionals to our firm. However, we expect to make continued progress toward our target range of expenses to total assets of 2.10 to 2.30 percent in 2014 primarily through achievement of our loan growth targets."
| o | Nonperforming assets declined by $2.8 million from Dec. 31, 2013, a linked-quarter reduction of 8.28 percent. Nonperforming assets were 0.73 percent of total loans and ORE at March 31, 2014, compared to 0.80 percent at Dec. 31, 2013 and 1.02 percent at March 31, 2013. |
| o | Allowance for loan losses represented 1.61 percent of total loans at March 31, 2014, compared to 1.64 percent at Dec. 31, 2013 and 1.84 percent at March 31, 2013. The ratio of the allowance for loan losses to nonperforming loans increased to 432.7 percent at March 31, 2014, from 373.8 percent at Dec. 31, 2013 and 317.9 percent at March 31, 2013. |
| § | Net charge-offs were $934,000 for the quarter ended March 31, 2014, compared to $1.54 million for the fourth quarter of 2013 and $2.18 million for the quarter ended March 31, 2013. Annualized net charge-offs as a percentage of average loans for the quarter ended March 31, 2014 were 0.09 percent compared to 0.24 percent for the quarter ended March 31, 2013. |
| § | Provision for loan losses decreased from $2.17 million for the first quarter of 2013 to $488,000 for the first quarter of 2014 and $2.23 million for the fourth quarter of 2013. |
WEBCAST AND CONFERENCE CALL INFORMATION
Pinnacle will host a webcast and conference call at 8:30 a.m. (CDT) on April 15, 2014 to discuss first quarter 2014 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, it 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, trust, mortgage and insurance products and services designed for businesses and their owners and individuals interested in a comprehensive relationship with their financial institution.
The firm began operations in a single downtown Nashville location in October 2000 and has since grown to $5.6 billion in assets at March 31, 2014. At March 31, 2014, Pinnacle is the second-largest bank holding company headquartered in Tennessee, with 29 offices in eight Middle Tennessee counties and four offices in Knoxville. Additionally, Great Place to Work® named Pinnacle one of the best workplaces in the United States on its 2013 Best Small & Medium Workplaces list published in FORTUNE magazine. The American Banker also recognized Pinnacle as the best bank to work for in the country.
Additional information concerning Pinnacle, which is included in the NASDAQ Financial-100 Index, 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," "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 risks 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 inability of Pinnacle Financial to grow its loan portfolio; (iv) changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments; (v) effectiveness of Pinnacle Financial's asset management activities in improving, resolving or liquidating lower-quality assets; (vi) increased competition with other financial institutions; (vii) greater than anticipated adverse conditions 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; (viii) rapid fluctuations or unanticipated changes in interest rates on loans or deposits; (ix) the results of regulatory examinations; (x) the ability to retain large, uninsured deposits; (xi) the development of any new market other than Nashville or Knoxville; (xii) a merger or acquisition; (xiii) any matter that would cause Pinnacle Financial to conclude that there was impairment of any asset, including intangible assets; (xiv) the ability to attract additional financial advisors or to attract customers from other financial institutions; (xv) further deterioration in the valuation of other real estate owned and increased expenses associated therewith; (xvi) inability to comply with regulatory capital requirements, including those resulting from changes to capital calculation methodologies and required capital maintenance levels; (xvii) risks associated with litigation, including the applicability of insurance coverage; (xviii) approval of the declaration of any dividend by Pinnacle Financial's board of directors and, (xix) 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. 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 25, 2014. 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.
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | |
| CONSOLIDATED BALANCE SHEETS – UNAUDITED | |
| | | | | | |
| | | March 31, 2014 | | | December 31, 2013 | |
ASSETS | | | | | | |
| Cash and noninterest-bearing due from banks | | $ | 94,172,230 | | | $ | 79,785,004 | |
| Interest-bearing due from banks | | | 75,826,385 | | | | 124,509,486 | |
| Federal funds sold and other | | | 938,792 | | | | 4,644,247 | |
| Cash and cash equivalents | | | 170,937,407 | | | | 208,938,737 | |
| | | | | | | | |
| Securities available-for-sale, at fair value | | | 735,400,911 | | | | 693,456,314 | |
| Securities held-to-maturity (fair value of $38,194,567 and $38,817,467 at | | | | | | | | |
| March 31, 2014 and December 31, 2013, respectively) | | | 38,733,099 | | | | 39,795,649 | |
| Mortgage loans held-for-sale | | | 13,970,926 | | | | 12,850,339 | |
| | | | | | | | |
| Loans | | | 4,181,686,799 | | | | 4,144,493,486 | |
| Less allowance for loan losses | | | (67,523,575 | ) | | | (67,969,693 | ) |
| Loans, net | | | 4,114,163,224 | | | | 4,076,523,793 | |
| | | | | | | | |
| Premises and equipment, net | | | 71,627,370 | | | | 72,649,574 | |
| Other investments | | | 33,358,506 | | | | 33,226,195 | |
| Accrued interest receivable | | | 17,219,090 | | | | 15,406,389 | |
| Goodwill | | | 243,568,203 | | | | 243,651,006 | |
| Core deposit and other intangible assets | | | 3,603,074 | | | | 3,840,750 | |
| Other real estate owned | | | 15,037,823 | | | | 15,226,136 | |
| Other assets | | | 143,312,957 | | | | 148,210,975 | |
| Total assets | | $ | 5,600,932,590 | | | $ | 5,563,775,857 | |
| | | | | | | | |
LIABILITIES AND STOCKHOLDERS' EQUITY | | | | | | | | |
| Deposits: | | | | | | | | |
| Noninterest-bearing | | $ | 1,180,202,107 | | | $ | 1,167,414,487 | |
| Interest-bearing | | | 912,387,013 | | | | 884,294,802 | |
| Savings and money market accounts | | | 1,902,452,916 | | | | 1,962,714,398 | |
| Time | | | 505,534,750 | | | | 519,049,037 | |
| Total deposits | | | 4,500,576,786 | | | | 4,533,472,724 | |
| Securities sold under agreements to repurchase | | | 68,092,650 | | | | 70,465,326 | |
| Federal Home Loan Bank advances | | | 150,604,286 | | | | 90,637,328 | |
| Subordinated debt and other borrowings | | | 98,033,292 | | | | 98,658,292 | |
| Accrued interest payable | | | 745,180 | | | | 792,703 | |
| Other liabilities | | | 40,383,743 | | | | 46,041,823 | |
| Total liabilities | | | 4,858,435,937 | | | | 4,840,068,196 | |
| | | | | | | | |
| 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; 35,567,268 shares and 35,221,941 | | | | | | | | |
| shares issued and outstanding at March 31, 2014 and December 31, 2013, respectively | | | 35,567,268 | | | | 35,221,941 | |
| Additional paid-in capital | | | 551,461,564 | | | | 550,212,135 | |
| Retained earnings | | | 155,840,829 | | | | 142,298,199 | |
| Accumulated other comprehensive loss, net of taxes | | | (373,008 | ) | | | (4,024,614 | ) |
| Stockholders' equity | | | 742,496,653 | | | | 723,707,661 | |
| Total liabilities and stockholders' equity | | $ | 5,600,932,590 | | | $ | 5,563,775,857 | |
| | | | | | | | |
| This information is preliminary and based on company data available at the time of the presentation. | | | | | | | | |
| | | | | | | | |
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | | | | | | | | | | | | | | | | |
| SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED | | |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| (dollars in thousands, except per share data) | | March | | | December | | | September | | | June | | | March | | | December | |
| | 2014 | | | 2013 | | | 2013 | | | 2013 | | | 2013 | | | 2012 | |
| | | | | | | | | | | | | | | | | | |
| Per share data: | | | | | | | | | | | | | | | | | | |
| Earnings – basic | | $ | 0.47 | | | | 0.45 | | | | 0.43 | | | | 0.42 | | | | 0.40 | | | | 0.35 | |
| Earnings – diluted | | $ | 0.47 | | | | 0.44 | | | | 0.42 | | | | 0.42 | | | | 0.39 | | | | 0.34 | |
| Common dividends per share | | $ | 0.08 | | | | 0.08 | | | | - | | | | - | | | | - | | | | - | |
Book value per common share at quarter end (9) | | $ | 20.88 | | | | 20.55 | | | | 20.27 | | | | 19.86 | | | | 19.74 | | | | 19.57 | |
| Tangible common equity per common share | | $ | 13.93 | | | | 13.52 | | | | 13.22 | | | | 12.78 | | | | 12.64 | | | | 12.39 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Weighted avg. common shares – basic | | | 34,602,337 | | | | 34,355,691 | | | | 34,282,899 | | | | 34,172,274 | | | | 33,987,265 | | | | 33,960,664 | |
| Weighted avg. common shares – diluted | | | 34,966,600 | | | | 34,765,424 | | | | 34,606,567 | | | | 34,431,054 | | | | 34,206,202 | | | | 34,527,479 | |
| Common shares outstanding | | | 35,567,268 | | | | 35,221,941 | | | | 35,133,733 | | | | 35,073,763 | | | | 35,022,487 | | | | 34,696,597 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Investor information: | | | | | | | | | | | | | | | | | | | | | | | | |
| Closing sales price | | $ | 37.49 | | | | 32.53 | | | | 29.81 | | | | 25.71 | | | | 23.36 | | | | 18.84 | |
| High closing sales price during quarter | | $ | 38.64 | | | | 33.25 | | | | 29.99 | | | | 26.17 | | | | 23.73 | | | | 20.60 | |
| Low closing sales price during quarter | | $ | 31.02 | | | | 29.67 | | | | 26.56 | | | | 21.68 | | | | 19.29 | | | | 18.05 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Other information: | | | | | | | | | | | | | | | | | | | | | | | | |
| Gains on mortgage loans sold: | | | | | | | | | | | | | | | | | | | | | | | | |
| Mortgage loan sales: | | | | | | | | | | | | | | | | | | | | | | | | |
| Gross loans sold | | $ | 61,290 | | | | 70,194 | | | | 105,817 | | | | 123,181 | | | | 120,569 | | | | 132,485 | |
Gross fees (10) | | $ | 1,504 | | | | 1,842 | | | | 2,470 | | | | 3,346 | | | | 3,158 | | | | 3,269 | |
| Gross fees as a percentage of loans originated | | | 2.45 | % | | | 2.62 | % | | | 2.33 | % | | | 2.72 | % | | | 2.62 | % | | | 2.47 | % |
Investment gains and losses on sales and impairments, net (17) | | $ | - | | | | - | | | | (1,441 | ) | | | (25 | ) | | | - | | | | 1,988 | |
Brokerage account assets, at quarter-end (11) | | $ | 1,611,232 | | | | 1,560,349 | | | | 1,445,461 | | | | 1,387,172 | | | | 1,333,676 | | | | 1,242,379 | |
| Trust account managed assets, at quarter-end | | $ | 613,440 | | | | 605,324 | | | | 576,190 | | | | 630,322 | | | | 515,970 | | | | 496,264 | |
| Balance of commercial loan participations sold to other | | | | | | | | | | | | | | | | | | | | | | | | |
| banks and serviced by Pinnacle, at quarter end | | $ | 53,959 | | | | 52,703 | | | | 50,797 | | | | 45,585 | | | | 42,721 | | | | 39,668 | |
Core deposits (12) | | $ | 4,087,477 | | | | 4,100,037 | | | | 3,903,000 | | | | 3,771,425 | | | | 3,537,860 | | | | 3,674,662 | |
Core deposits to total funding (12) | | | 84.8 | % | | | 85.5 | % | | | 84.3 | % | | | 81.3 | % | | | 84.0 | % | | | 87.3 | % |
| Risk-weighted assets | | $ | 4,740,545 | | | | 4,785,028 | | | | 4,568,667 | | | | 4,531,730 | | | | 4,388,341 | | | | 4,239,384 | |
| Total assets per full-time equivalent employee | | $ | 7,528 | | | | 7,408 | | | | 7,305 | | | | 7,335 | | | | 7,038 | | | | 6,900 | |
| Annualized revenues per full-time equivalent employee | | $ | 319.7 | | | | 303.5 | | | | 300.8 | | | | 300.8 | | | | 307.7 | | | | 301.4 | |
| Number of employees (full-time equivalent) | | | 744.0 | | | | 751.0 | | | | 738.0 | | | | 732.5 | | | | 720.5 | | | | 730.5 | |
Associate retention rate (13) | | | 95.6 | % | | | 94.4 | % | | | 93.9 | % | | | 93.0 | % | | | 91.2 | % | | | 93.2 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Selected economic information (in thousands) (14): | | | | | | | | | | | | | | | | | | | | | | | | |
| Nashville MSA nonfarm employment - February 2014 | | | 827.5 | | | | 817.3 | | | | 814.7 | | | | 817.1 | | | | 807.1 | | | | 799.7 | |
| Knoxville MSA nonfarm employment - February 2014 | | | 337.1 | | | | 334.2 | | | | 337.7 | | | | 337.9 | | | | 337.4 | | | | 333.5 | |
| Nashville MSA unemployment - January 2014 | | | 5.2 | % | | | 5.8 | % | | | 6.5 | % | | | 6.6 | % | | | 6.2 | % | | | 6.3 | % |
| Knoxville MSA unemployment - January 2014 | | | 5.6 | % | | | 6.3 | % | | | 7.0 | % | | | 6.9 | % | | | 6.6 | % | | | 6.5 | % |
| Nashville residential median home price - March 2014 | | $ | 195.0 | | | | 198.8 | | | | 197.9 | | | | 205.9 | | | | 169.0 | | | | 181.0 | |
Nashville inventory of residential homes for sale - March 2014 (16) | | | 4.6 | | | | 4.0 | | | | 10.2 | | | | 10.5 | | | | 9.9 | | | | 9.1 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| This information is preliminary and based on company data available at the time of the presentation. | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES | | | | | | | | | | | | | | | | |
| RECONCILIATION OF NON-GAAP SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED | | |
| | | | | | | | | | | | | | | | | | |
| | March | | | December | | | September | | | June | | | March | | | December | |
(dollars in thousands, except per share data) | | 2014 | | | 2013 | | | 2013 | | | 2013 | | | 2013 | | | 2012 | |
| | | | | | | | | | | | | | | | | | | |
| Tangible assets: | | | | | | | | | | | | | | | | | | |
| Total assets | | $ | 5,600,933 | | | | 5,563,776 | | | | 5,391,201 | | | | 5,373,168 | | | | 5,070,935 | | | | 5,040,549 | |
| Less: Goodwill | | | (243,568 | ) | | | (243,651 | ) | | | (243,808 | ) | | | (243,900 | ) | | | (244,012 | ) | | | (244,040 | ) |
| Core deposit and other intangible assets | | | (3,603 | ) | | | (3,841 | ) | | | (4,087 | ) | | | (4,334 | ) | | | (4,582 | ) | | | (5,103 | ) |
| Net tangible assets | | $ | 5,353,762 | | | | 5,316,284 | | | | 5,143,306 | | | | 5,124,934 | | | | 4,822,342 | | | | 4,791,406 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Tangible equity: | | | | | | | | | | | | | | | | | | | | | | | | |
| Total stockholders' equity | | $ | 742,497 | | | | 723,708 | | | | 712,216 | | | | 696,569 | | | | 691,434 | | | | 679,071 | |
| Less: Goodwill | | | (243,568 | ) | | | (243,651 | ) | | | (243,808 | ) | | | (243,900 | ) | | | (244,012 | ) | | | (244,040 | ) |
| Core deposit and other intangible assets | | | (3,603 | ) | | | (3,841 | ) | | | (4,087 | ) | | | (4,334 | ) | | | (4,582 | ) | | | (5,103 | ) |
| Net tangible common equity | | $ | 495,326 | | | | 476,216 | | | | 464,321 | | | | 448,335 | | | | 442,840 | | | | 429,928 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Ratio of tangible common equity to tangible assets | | | 9.25 | % | | | 8.96 | % | | | 9.03 | % | | | 8.75 | % | | | 9.18 | % | | | 8.97 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | For the three months ended | |
| | March | | | December | | | September | | | June | | | March | | | December | |
| | 2014 | | | 2013 | | | 2013 | | | 2013 | | | 2013 | | | 2012 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income | | $ | 45,908 | | | | 44,969 | | | | 44,573 | | | | 43,599 | | | | 42,758 | | | | 42,243 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Noninterest income | | | 12,736 | | | | 12,488 | | | | 11,387 | | | | 11,326 | | | | 11,902 | | | | 13,108 | |
| Less: Investment gains and losses on sales and impairments, net | | | - | | | | - | | | | 1,441 | | | | 25 | | | | - | | | | (1,988 | ) |
| Net noncredit related loan losses | | | - | | | | - | | | | - | | | | 771 | | | | - | | | | - | |
| Noninterest income excluding investment gains and losses on | | | | | | | | | | | | | | | | | | | | | | | | |
| sales and impairments, net, and noncredit related loan losses | | | 12,736 | | | | 12,488 | | | | 12,828 | | | | 12,122 | | | | 11,902 | | | | 11,120 | |
| Total revenues excluding the impact of investment gains and losses on | | | | | | | | | | | | | | | | | | | | | | | | |
| sales and impairments, net, and noncredit related loan losses | | | 58,644 | | | | 57,457 | | | | 57,401 | | | | 55,721 | | | | 54,660 | | | | 53,363 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Noninterest expense | | | 33,650 | | | | 32,637 | | | | 33,323 | | | | 30,862 | | | | 32,440 | | | | 34,851 | |
| Less: Other real estate expense | | | 651 | | | | 302 | | | | 699 | | | | 1,391 | | | | 721 | | | | 1,365 | |
| FHLB restructuring charges | | | - | | | | - | | | | - | | | | - | | | | 877 | | | | 2,092 | |
| Noninterest expense excluding the impact of other real estate | | | | | | | | | | | | | | | | | | | | | | | | |
| expense and FHLB restructuring charges | | | 32,999 | | | | 32,335 | | | | 32,624 | | | | 29,471 | | | | 30,842 | | | | 31,394 | |
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Adjusted pre-tax pre-provision income (15) | | $ | 25,645 | | | | 25,122 | | | | 24,777 | | | | 26,250 | | | | 23,818 | | | | 21,969 | |
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Efficiency Ratio (4) | | | 57.4 | % | | | 56.8 | % | | | 59.5 | % | | | 56.2 | % | | | 59.4 | % | | | 63.0 | % |
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| Total average assets | | $ | 5,514,031 | | | | 5,388,371 | | | | 5,313,003 | | | | 5,210,600 | | | | 4,992,018 | | | | 4,964,521 | |
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Noninterest expense (excluding ORE expense and FHLB restructuring charges) to avg. assets (1) | | | 2.43 | % | | | 2.38 | % | | | 2.44 | % | | | 2.24 | % | | | 2.45 | % | | | 2.51 | % |
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| 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 |
| SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED |
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| 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. Troubled debt restructurings include loans where the company, as a result of the borrower's financial difficulties, has granted a credit concession to the borrower (i.e., interest only payments for a significant period of time, extending the maturity of the loan, etc.). All of these loans continue to accrue interest at the contractual rate. |
| 6. 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. |
| 7. 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. |
| 8. Capital ratios are defined as follows: |
| Equity to total assets – End of period total stockholders' equity as a percentage of end of period assets. |
| Tangible common equity to total assets - End of period total stockholders' equity less end of period goodwill, core deposit and other intangibles 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. |
| Classified asset - Classified assets as a percentage of Tier 1 capital plus allowance for loan losses. |
| Tier one common equity to risk weighted assets - Tier 1 capital (pursuant to risk-based capital guidelines) less the amount of any preferred stock or subordinated indebtedness that is considered |
| as a component of tier 1 capital as a percentage of total risk-weighted assets. |
| 9. Book value per share computed by dividing total stockholders' equity less preferred stock and common stock warrants by common shares outstanding. |
| 10. Amounts are included in the statement of operations in "Gains on loans sold, net", net of commissions paid on such amounts. |
| 11. At fair value, based on information obtained from Pinnacle's third party broker/dealer for non-FDIC insured financial products and services. |
| 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 $250,000. |
| 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 BERC- MTSU & Bureau of Labor Statistics. Labor force data is seasonally adjusted. The most recent quarter data presented is as of the most recent month that data is available as of the release date. Historical data is subject to update by the BERC- MTSU & Bureau of Labor Statistics. Historical data is presented based on the most recently reported data available by the BERC- MTSU & Bureau of Labor Statistics. The Nashville home data is from the Greater Nashville Association of Realtors. |
| 15. Adjusted pre-tax, pre-provision income excludes the impact of investment gains and losses on sales and impairments, net and non-credit related loan losses as well as other real estate owned expenses and FHLB restructuring charges. |
| 16. Represents months supply of homes currently listed with MLS based on current sales activity in the Nashville MSA. |
| 17. Represents investment gains (losses) on sales and impairments, net occurring as a result of both credit losses and losses incurred as the result of a change in management's intention to sell a bond prior to the recovery of its amortized cost basis. |
| 18. The dividend payout ratio is calculated as the sum of the annualized dividend rate divided by the trailing 12-months fully diluted earnings per share as of the dividend declaration date. |
