EXHIBIT-99.1 (PINNACLE LOGO) FOR IMMEDIATE RELEASE MEDIA CONTACT: Tiffany Carpenter 615-320-7532 FINANCIAL CONTACT: Harold Carpenter 615-744-3742 WEBSITE: www.mypinnacle.com PINNACLE FINANCIAL REPORTS CONTINUED RAPID GROWTH WITH EARNINGS OF $0.10 PER SHARE AND $348 MILLION IN ASSETS FOR FIRST QUARTER OF 2003 NASHVILLE, Tenn., April 14, 2003 - Pinnacle Financial Partners Inc. (Nasdaq: PNFP), the holding company for Pinnacle National Bank, today reported net income for the quarter ended March 31, 2003, of $373,000, or $0.10 per diluted share, compared to a net income of $45,000, or $0.02 per diluted share for the quarter ended March 31, 2002, an increase of 400 percent. Total assets grew to $348 million as of March 31, 2003, up 82 percent from the $192 million reported at March 31, 2002 and up $43 million from December 31, 2002. Total assets at March 31, 2003, include approximately $329 million in earning assets or 95 percent of total assets. Deposits in the first quarter rose to $267 million at March 31, 2003, a 78 percent increase from $150 million in deposits at March 31, 2002 and up $33 million from December 31, 2002. "We continue to be pleased with the company's growth in both earnings and assets," said M. Terry Turner, president and CEO of Pinnacle Financial Partners. "Many of Nashville's most respected companies are moving their banking relationships to Pinnacle as a result of our record of distinctive service, effective financial advice and their desire to deal with local decision makers." Net interest income for the first quarter of 2003 was $2.6 million, compared to $1.7 million for the first quarter of 2002. The net interest margin for the first quarter of 2003 was 3.5 percent, compared to a net interest margin of 4.1 percent for the first quarter of 2002. The provision for loan losses was $288,000 for the first quarter of 2003, compared to $209,000 for the first quarter of 2002. The allowance for loan losses represented 1.25 percent of total loans at March 31, 2003. Noninterest income for the first quarter of 2003 was $462,000, compared to $292,000 for the first quarter of 2002. For the first quarter of 2003 noninterest income represented approximately 15 percent of total revenues (net interest income and noninterest income). Noninterest expense for the first quarter of 2003 was $2.2 million, compared to $1.7 million for the first quarter of 2002. The efficiency ratio for the first quarter of 2003 improved to 72 percent, compared to 86 percent for the first quarter of 2002. During the first quarter of 2003, Pinnacle continued its focus on those factors which have contributed to its early successes while also investing in four new initiatives to broaden its reach into the greater Nashville market, including: - Deepening the company's talent by continuing to recruit experienced individuals in the Nashville market with strong client relationships and the ability to provide distinctive service and effective financial advice. During the first quarter of 2003, the company increased its employee base by 20% and anticipates continued hiring of market proven professionals during the remainder of this year. - Launching our new home mortgage origination unit in January. - Completing construction of a new office in the Rivergate area of Davidson County which opened in April of 2003. This brings the company's total number of locations to four in the metropolitan Nashville market. - Finalizing the acquisition of property in the Cool Springs area in Williamson County for an office scheduled to open in late fall or winter of this year. Based on these incremental investments, anticipated growth trends and the anticipated results from these trends, Pinnacle Financial Partners estimates its second quarter 2003 diluted earnings per share will approximate $0.12 to $0.14. Additionally, diluted earnings per share for the year ending December 31, 2003, are currently estimated to be $0.55 to $0.65. 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 may cause the actual results, performance or achievements of Pinnacle Financial Partners to differ materially from these estimates. 2 Pinnacle Financial Partners, a Nashville-based financial services firm, was founded in March 2000 by prominent Nashville business leaders, including five former First American Corporation executives. Pinnacle, which opened for business October 2000, offers a full-range of banking, investment, and insurance products targeted at small and medium-sized businesses and their owner/managers. Pinnacle operates four offices in the downtown, Green Hills and Rivergate areas of Nashville and in Brentwood, Tennessee. Additional information concerning Pinnacle can be accessed at www.mypinnacle.com. ### Certain of the statements in this release may constitute forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1933, as amended (the "Securities Act"), 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 the Company 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) increased competition with other financial institutions, (iii) lack of sustained growth in the economy in the Nashville, Tennessee area, (iv) rapid fluctuations or unanticipated changes in interest rates, (v) the inability of the Bank to satisfy regulatory requirements for its expansion plans, and (vi) changes in the legislative and regulatory environment, a more detailed description of various risks is contained in the Company's most recent annual report on Form 10 KSB. Many of such factors are beyond the Company's ability to control or predict, and readers are cautioned not to put undue reliance on such forward-looking statements. The Company 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. 3 PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS - UNAUDITED MARCH 31, DECEMBER 31, 2003 2002 ------------- ------------- ASSETS Cash and noninterest-bearing due from banks ......................... $ 11,477,529 $ 8,061,300 Interest-bearing due from banks ..................................... 935,614 4,195,647 Federal funds sold and securities purchased under agreements to resell ............................................. 4,318,135 685,182 ------------- ------------- Cash and cash equivalents ...................................... 16,731,278 12,942,129 Securities available-for-sale, at fair value ........................ 94,600,186 73,980,054 Mortgage loans held-for-sale ........................................ 790,150 -- Loans ............................................................... 228,842,646 209,743,436 Less allowance for loan losses ...................................... (2,860,000) (2,677,043) ------------- ------------- Loans, net .................................................... 225,982,646 207,066,393 Premises and equipment, net ......................................... 4,393,627 3,611,504 Other assets ........................................................ 5,868,545 5,839,834 ------------- ------------- Total assets ............................................... $ 348,366,432 $ 305,278,974 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY Deposits: Noninterest-bearing demand ..................................... $ 38,817,830 $ 31,599,897 Interest-bearing demand ........................................ 13,962,696 13,234,956 Savings and money market accounts .............................. 87,700,475 75,995,881 Time ........................................................... 126,250,590 113,185,655 ------------- ------------- Total deposits ............................................. 266,731,591 234,016,389 Securities sold under agreements to repurchase ...................... 15,845,627 15,050,208 Federal Home Loan Bank advances ..................................... 32,500,000 21,500,000 Other liabilities ................................................... 885,973 2,308,730 ------------- ------------- Total liabilities .......................................... 315,963,191 272,875,327 Commitments and contingent liabilities Stockholders' equity: Preferred stock, no par value; 10,000,000 shares authorized; no shares issued and outstanding ................. -- -- Common stock, par value $1.00; 10,000,000 shares authorized; 3,692,053 issued and outstanding at March 31, 2003 and December 31, 2002 ......................... 3,692,053 3,692,053 Additional paid-in capital ..................................... 30,682,947 30,682,947 Accumulated deficit ............................................ (2,370,815) (2,743,794) Accumulated other comprehensive income, net .................... 399,056 772,441 ------------- ------------- Total stockholders' equity ................................. 32,403,241 32,403,647 ------------- ------------- Total liabilities and stockholders' equity ................. $ 348,366,432 $ 305,278,974 ============= ============= 4 PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED THREE MONTHS ENDED MARCH 31, 2003 2002 ---------- --------- INTEREST INCOME: Loans, including fees ................................. $2,963,513 2,264,696 Securities, available-for-sale: Taxable .......................................... 908,046 274,222 Tax-exempt ....................................... 37,863 -- Federal funds sold and other .......................... 36,411 34,162 ---------- --------- Total interest income ............................ 3,945,833 2,573,080 ---------- --------- INTEREST EXPENSE: Deposits .............................................. 1,072,672 796,126 Securities sold under agreements to repurchase ........ 14,796 21,611 Federal funds purchased and other borrowings .......... 222,130 73,688 ---------- --------- Total interest expense ........................... 1,309,598 891,405 ---------- --------- Net interest income .............................. 2,636,235 1,681,675 PROVISION FOR LOAN LOSSES ............................. 288,026 209,000 ---------- --------- NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES ... 2,348,209 1,472,675 NONINTEREST INCOME: Service charges on deposit accounts .............. 101,753 53,640 Investment services .............................. 155,932 181,510 Gain on sale of investment securities ............ 17,698 -- Gain on loan participations sold, net ............ 2,189 19,773 Other noninterest income ......................... 184,610 49,227 ---------- --------- Total noninterest income ..................... 462,182 304,150 ---------- --------- NONINTEREST EXPENSE: Compensation and employee benefits ............... 1,434,912 1,108,312 Equipment and occupancy .......................... 396,825 340,871 Marketing and other business development ......... 75,490 45,898 Postage and supplies ............................. 73,262 54,914 Other noninterest expense ........................ 261,775 154,924 ---------- --------- Total noninterest expense .................... 2,242,264 1,704,914 ---------- --------- INCOME BEFORE INCOME TAXES ............................ 568,127 71,911 Income tax expense ............................... 195,148 27,327 ---------- --------- NET INCOME ............................................ $ 372,979 44,584 ========== ========= PER SHARE INFORMATION: Basic net income per common share ................ $ 0.10 0.02 ========== ========= Diluted net income per common share .............. $ 0.10 0.02 ========== ========= Weighted average shares outstanding: Basic ........................................ 3,692,053 2,312,053 Diluted ...................................... 3,841,631 2,323,076 5 PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES SELECTED QUARTERLY FINANCIAL DATA - UNAUDITED (DOLLARS IN THOUSANDS, MAR DEC SEPT JUNE MARCH DEC EXCEPT PER SHARE DATA) 2003 2002 2002 2002 2002 2001 BALANCE SHEET DATA, AT QUARTER END: Total assets ....................................... $ 348,366 305,279 278,750 229,795 192,476 175,439 Total loans ........................................ 228,842 209,743 191,299 170,427 151,280 134,440 Allowance for loan losses .......................... (2,860) (2,677) (2,427) (2,182) (2,041) (1,832) Securities available-for-sale ...................... 94,600 73,980 57,062 37,950 20,302 19,886 Total deposits ..................................... 266,732 234,016 212,914 168,752 149,460 133,259 Securities sold under agreements to repurchase ..... 15,846 15,050 16,720 16,855 10,223 14,658 Advances from FHLB ................................. 32,500 21,500 15,500 11,500 11,500 8,500 Total stockholders' equity ......................... 32,403 32,404 32,089 31,402 18,172 18,291 BALANCE SHEET DATA, QUARTERLY AVERAGES: Total assets ....................................... $ 326,108 285,929 243,284 204,592 177,994 143,050 Total loans ........................................ 217,690 201,290 181,005 158,076 143,402 110,755 Securities available-for-sale ...................... 87,124 63,150 42,007 24,904 19,438 20,276 Total deposits ..................................... 243,545 215,617 181,844 163,146 137,933 110,094 Securities sold under agreements to repurchase ..... 14,106 16,685 13,091 10,496 10,644 10,308 Advances from FHLB ................................. 29,994 18,054 14,196 11,500 8,600 5,228 Total stockholders' equity ......................... 32,675 32,167 31,808 18,694 18,292 14,841 STATEMENT OF OPERATIONS DATA, FOR THE THREE MONTHS ENDED: Interest income .................................... $ 3,946 3,691 3,425 2,872 2,573 2,212 Interest expense ................................... 1,310 1,268 1,146 1,057 891 792 ----------- ---------- ---------- ---------- ---------- ---------- Net interest income .............................. 2,636 2,423 2,279 1,815 1,682 1,420 Provision for loan losses .......................... 288 250 247 232 209 647 ----------- ---------- ---------- ---------- ---------- ---------- Net interest income after provision for loan losses 2,348 2,173 2,032 1,583 1,473 773 Noninterest income ................................. 462 469 497 462 304 498 Noninterest expense ................................ 2,242 2,230 2,182 1,872 1,705 1,604 ----------- ---------- ---------- ---------- ---------- ---------- Net income before taxes ......................... 568 412 347 173 72 (333) Income tax expense (benefit) ....................... 195 127 136 66 27 (2,065) ----------- ---------- ---------- ---------- ---------- ---------- Net income (loss) ............................... $ 373 285 211 107 45 1,732 =========== ========== ========== ========== ========== ========== PER SHARE DATA: Earnings - basic ................................... $ 0.10 0.08 0.06 0.04 0.02 0.79 Earnings - diluted ................................. $ 0.10 0.08 0.06 0.04 0.02 0.79 Book value at quarter end .......................... $ 8.78 8.78 8.69 8.51 7.86 7.91 Weighted avg. shares - basic ....................... 3,692,053 3,692,053 3,692,053 2,521,723 2,312,053 2,198,430 Weighted avg. shares - diluted ..................... 3,841,631 3,795,967 3,745,272 2,555,844 2,323,076 2,198,430 Commons shares outstanding ......................... 3,692,053 3,692,053 3,692,053 3,692,053 2,312,053 2,312,053 CAPITAL RATIOS (1): Leverage ........................................... 10.1% 11.1% 13.1% 14.7% 9.5% 11.2% Tier 1 risk-based .................................. 12.1% 12.7% 13.0% 15.4% 9.4% 10.1% Total risk-based ................................... 13.2% 13.8% 14.0% 16.6% 10.4% 11.6% INVESTOR INFORMATION: Closing price at end of quarter .................... $ 13.46 12.91 11.19 11.74 9.75 10.25 High bid during quarter ............................ $ 14.14 13.30 13.00 11.90 10.50 11.00 Low bid during quarter ............................. $ 12.76 11.01 10.90 9.70 8.75 7.20 (1) Capital ratios are for Pinnacle Financial Partners, Inc. and are defined as follows: Leverage - Tier 1 capital (pursuant to risk-based capital guidelines) as a percentage of adjusted average assets. Tier 1 risk-based - Tier 1 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. 6 PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES SELECTED QUARTERLY FINANCIAL DATA -- UNAUDITED - --------------------------------------------------------------------------------------------------------------------------------- (DOLLARS IN THOUSANDS, MAR DEC SEPT JUNE MARCH DEC EXCEPT PER SHARE DATA) 2003 2002 2002 2002 2002 2001 - --------------------------- --------- ---------- ---------- --------- ----------- --------- PERFORMANCE RATIOS AND OTHER DATA: Return on average assets ..................... 0.46% 0.40% 0.34% 0.21% 0.10% 4.80% Return on average stockholders' equity ....... 4.63% 3.52% 2.64% 1.83% 0.98% 41.40% Net interest margin (2) ...................... 3.46% 3.59% 3.97% 3.74% 4.10% 4.21% Noninterest income to total revenue (3) ...... 14.9% 16.2% 17.9% 20.3% 15.1% 25.9% Noninterest income to avg. assets ............ 0.57% 0.65% 0.81% 0.90% 0.68% 1.38% Noninterest expense to avg. assets ........... 2.79% 3.09% 3.56% 3.64% 3.89% 4.45% Efficiency ratio ............................. 72.4% 77.1% 78.6% 82.2% 85.9% 83.7% Average loans to average deposits ............ 89.4% 93.4% 97.7% 97.1% 103.4% 100.6% Average interest earning assets to average interest-bearing liabilities ........ 119.4% 120.6% 119.0% 115.0% 114.5% 116.2% Brokered time deposits to total deposits ..... 16.8% 18.0% 19.8% 23.7% 26.5% 20.5% ASSET QUALITY INFORMATION AND RATIOS: Nonaccrual loans ............................. $ 1,095 1,845 70 90 220 250 Past due loans over 90 days and still accruing interest .......................... $ 44 22 41 15 20 -- Net loan charge-off's ........................ $ 105 -- 2 91 -- -- Allowance for loan losses to total loans ..... 1.25% 1.28% 1.27% 1.28% 1.35% 1.36% Nonaccrual loans to total loans .............. 0.48% 0.88% 0.04% 0.05% 0.15% 0.19% Avg. commercial loan internal risk ratings (4) 3.9 3.9 4.0 4.0 3.9 3.8 Avg. loan account balances (5) ............... $ 158 163 155 151 149 156 INTEREST RATES AND YIELDS: Loans ........................................ 5.52% 5.81% 6.21% 6.18% 6.42% 6.78% Securities, available-for-sale ............... 4.44% 4.41% 5.16% 5.58% 5.73% 5.70% Federal funds sold and other ................. 2.22% 2.58% 2.92% 2.15% 2.82% 3.13% Deposits ..................................... 1.79% 1.99% 2.17% 2.34% 2.34% 2.55% Securities sold under agreements to repurchase 0.43% 0.61% 0.71% 0.76% 0.82% 1.25% Federal funds purchased and other borrowings . 2.63% 3.16% 3.26% 3.45% 2.89% 2.93% OTHER INFORMATION: Brokerage account assets, at quarter-end (6) $177,000 171,000 166,000 165,000 169,000 136,000 Associate retention rate (7) ................. 92.4% 94.5% 94.4% 96.2% 96.2% 98.0% (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) 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). Loans rated "8" or worse are considered potential problem credits. Generally, consumer loans are not subjected to internal risk ratings. (5) Computed by dividing the balance of all loans by the number of loan accounts as of the end of each quarter. (6) At market value, based on information obtained from the company's third party broker/dealer for non-FDIC insured financial products and services. (7) 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. 7