2Q23 annualized linked-quarter,
end-of-period loans grew 11.3%, while deposits grew 17.1%
Pinnacle Financial Partners, Inc. (Nasdaq/NGS: PNFP) reported
net income per diluted common share of $2.54 for the quarter ended
June 30, 2023, compared to net income per diluted common share of
$1.86 for the quarter ended June 30, 2022, an increase of 36.6
percent. Net income per diluted common share was $4.30 for the six
months ended June 30, 2023, compared to $3.51 for the six months
ended June 30, 2022, an increase of approximately 22.5 percent.
Excluding losses on the sale of investment securities, other
real estate (ORE) expense and gains on the sale of fixed assets
associated with the firm's sale-leaseback transaction for the three
months ended June 30, 2023 and 2022, net income per diluted common
share was $1.79 for the three months ended June 30, 2023, compared
to $1.86 for the three months ended June 30, 2022, a decrease of
3.8 percent. Excluding losses on the sale of investment securities,
other real estate (ORE) expense and gains on the sale of fixed
assets associated with our sale-leaseback transaction for the six
months ended June 30, 2023 and 2022, net income per diluted common
share was $3.55 for the six months ended June 30, 2023, compared to
$3.51 for the six months ended June 30, 2022, an increase of 1.1
percent.
"This proved to be another sound operating quarter especially
given the results of several critical performance metrics such as
asset quality, net interest income growth and tangible book value
accretion," said M. Terry Turner, Pinnacle's president and chief
executive officer. "Second quarter results continue to reflect our
longstanding and ongoing ability to leverage our award-winning work
environment and market-leading net promoter scores to take market
share from our large national and regional competitors. The second
quarter of 2023 also saw us increase our thrust and focus on
gathering client funding, which is the 'raw material' that we need
to support our outsized loan and earnings growth over time.
Consequently, our relationship managers attracted client funding
from across our footprint, which resulted in deposit growth of over
$1.5 billion this quarter. Loan growth during the second quarter of
2023 was $855 million, or 11.3% linked-quarter annualized. This
amount is consistent with the outlook we provided in connection
with our first quarter results and is reflective of our deliberate
efforts to moderate loan growth by constraining certain asset
classes and elevating loan pricing.
"We also added 20 revenue producers during the quarter. Despite
all the uncertainty plaguing the industry, we continue to invest in
our proven relationship banking model and believe, even during
times such as these, that a consistent focus on attracting and
retaining highly successful revenue producers and their clients
will enable us to continue compounding earnings and accreting
tangible book value more reliably than peers.
"Our second quarter diluted earnings per share includes the
positive impact of $0.84 per diluted common share from a
sale-leaseback transaction that was executed during the second
quarter. The gain from the sale-leaseback transaction was partially
offset by the realized net loss of approximately $0.10 per diluted
common share from the sale of approximately $174.0 million in
available-for-sale investment securities."
BALANCE SHEET GROWTH:
Total assets at June 30, 2023 were $46.9 billion, an increase of
approximately $6.8 billion from June 30, 2022 and $1.8 billion from
March 31, 2023, reflecting a year-over-year increase of 16.8
percent and a linked-quarter annualized increase of 15.6 percent,
respectively. A further analysis of select balance sheet trends
follows:
Balances at
Linked- Quarter
Annualized % Change
Balances at
Year-over-Year %
Change
(dollars in thousands)
June 30, 2023
March 31, 2023
June 30, 2022
Loans
$
31,153,290
$
30,297,871
11.3
%
$
26,333,096
18.3
%
Less: PPP loans
4,650
6,382
NM
51,100
(90.9
)%
Loans excluding PPP loans
31,148,640
30,291,489
11.3
%
26,281,996
18.5
%
Securities and other interest-earning
assets
10,625,301
10,080,769
21.6
%
9,342,543
13.7
%
Total interest-earning assets excluding
PPP loans
$
41,773,941
$
40,372,258
13.9
%
$
35,624,539
17.3
%
Core deposits:
Noninterest-bearing deposits
$
8,436,799
$
9,018,439
(25.8
)%
$
11,058,198
(23.7
)%
Interest-bearing core deposits(1)
24,343,968
23,035,672
22.7
%
18,953,246
28.4
%
Noncore deposits and other funding(2)
7,731,082
6,865,003
50.5
%
4,496,117
72.0
%
Total funding
$
40,511,849
$
38,919,114
16.4
%
$
34,507,561
17.4
%
(1):
Interest-bearing core deposits
are interest-bearing deposits, money market accounts, time deposits
less than $250,000 including certain reciprocating time and money
market deposits issued through the IntraFi Network.
(2):
Noncore deposits and other
funding consists of time deposits greater than $250,000, securities
sold under agreements to repurchase, public funds, brokered
deposits, FHLB advances and subordinated debt.
"End-of-period loans grew by $855.4 million over last quarter,
and end-of-period deposits grew by $1.5 billion over the same
period, reflecting an annualized linked-quarter growth rate of 11.3
percent and 17.1 percent, respectfully," Turner said. "We continued
to experience a mix shift in our deposits as more deposits moved
from noninterest-bearing accounts to interest-bearing accounts,
albeit at a lesser pace than the previous quarters. We anticipate
that the reduction in noninterest bearing balances will slow from
the pace of previous quarters this year.
"Our cumulative deposit beta at June 30, 2023 increased to 48.0
percent, which is consistent with our expectations. We believe with
more rate hikes in the forecast for 2023, our funding costs will
increase just not at the same rate as the second quarter increase.
Furthermore, we anticipate that the impact of our hiring and usual
seasonal growth will enable us to continue to grow our deposits for
the remainder of the year at levels that should support our current
outlook of high single-digit percentage deposit growth for 2023
over 2022."
PRE-TAX, PRE-PROVISION NET REVENUE (PPNR) GROWTH:
Pre-tax, pre-provision net revenues (PPNR) for the three and six
months ended June 30, 2023 were $277.6 million and $467.6 million,
respectively, inclusive of $85.7 million of gain on the sale of
fixed assets as a result of the sale-leaseback transaction
completed in the three months ended June 30, 2023, an increase of
43.1 percent and 32.0 percent, respectively, from the $194.0
million and $354.3 million, respectively, recognized in the three
and six months ended June 30, 2022.
Three months ended
Six months ended
June 30,
June 30,
(dollars in thousands)
2023
2022
% change
2023
2022
% change
Revenues:
Net interest income
$
315,393
$
264,574
19.2
%
$
627,624
$
504,049
24.5
%
Noninterest income
173,839
125,502
38.5
%
263,368
228,998
15.0
%
Total revenues
489,232
390,076
25.4
%
890,992
733,047
21.5
%
Noninterest expense
211,641
196,038
8.0
%
423,368
378,699
11.8
%
Pre-tax, pre-provision net revenue
(PPNR)
277,591
194,038
43.1
%
467,624
354,348
32.0
%
Adjustments:
Investment losses on sales of securities,
net
9,961
—
NM
9,961
61
NM
Gain on the sale of fixed assets as a
result of sale leaseback
(85,692
)
—
NM
(85,692
)
—
NM
ORE expense
58
86
(32.6
)%
157
191
(17.8
)%
Adjusted PPNR
$
201,918
$
194,124
4.0
%
$
392,050
$
354,600
10.6
%
- Revenue per fully diluted common share was $6.43 for the second
quarter of 2023, compared to $5.28 for the first quarter of 2023
and $5.14 for the second quarter of 2022, a 25.1 percent
year-over-year growth rate. Excluding net losses on sales of
investment securities, gain on the sale of fixed assets as a result
of the sale-leaseback transaction and ORE expense, revenue per
fully diluted share for the second quarter of 2023 was $5.43.
- Net interest income for the quarter ended June 30, 2023 was
$315.4 million, compared to $312.2 million for the first quarter of
2023 and $264.6 million for the second quarter of 2022, a
year-over-year growth rate of 19.2 percent.
- Revenues from PPP loans approximated $34,000 in the second
quarter of 2023, compared to $20,000 in the first quarter of 2023
and $4.1 million in the second quarter of 2022. At June 30, 2023,
remaining unamortized fees for PPP loans were approximately
$192,000.
- Included in net interest income for the second quarter of 2023
was $776,000 of discount accretion associated with fair value
adjustments, compared to $852,000 of discount accretion recognized
in the first quarter of 2023 and $1.6 million in the second quarter
of 2022. There remains $1.9 million of purchase accounting discount
accretion as of June 30, 2023.
- Noninterest income for the quarter ended June 30, 2023 was
$173.8 million, compared to $89.5 million for the first quarter of
2023 and $125.5 million for the second quarter of 2022, a
year-over-year increase of 38.5 percent.
- Gain on the sale of fixed assets was $85.7 million for the
quarter ended June 30, 2023, compared to $135,000 and $65,000,
respectively, for the quarters ended March 31, 2023 and June 30,
2022. The quarter ended June 30, 2023 included a gain on the sale
of fixed assets as a result of the sale-leaseback transaction
completed in the second quarter of 2023 of $85.7 million.
- Net losses on the sale of investment securities were $10.0
million for the quarter ended June 30, 2023, compared to no gains
or losses for the quarters ended March 31, 2023 and June 30,
2022.
- Wealth management revenues, which include investment, trust and
insurance services, were $24.1 million for the second quarter of
2023, compared to $22.5 million for the first quarter of 2023 and
$21.8 million for the second quarter of 2022, a year-over-year
increase of 10.2 percent.
- During the second quarter of 2023, mortgage loans sold resulted
in a $1.6 million net gain, compared to a $2.1 million net gain in
the first quarter of 2023 and a $2.2 million net gain in the second
quarter of 2022.
- Income from the firm's investment in BHG was $26.9 million for
the second quarter 2023, compared to $19.1 million for the first
quarter of 2023 and $49.5 million for the second quarter of 2022, a
year-over-year decline of 45.6 percent.
- Loan originations increased to $1.1 billion in the second
quarter of 2023 compared to $1.0 billion in the first quarter of
2023 and $1.1 billion in the second quarter of 2022.
- Loans sold to BHG's community bank partners were approximately
$523 million in the second quarter of 2023 compared to
approximately $704 million in the first quarter of 2023 and $658
million in the second quarter of 2022. BHG also sold $557 million
in loans to private investors during the second quarter of
2022.
- BHG increased its reserves for on-balance sheet loan losses to
$196 million, or 5.99 percent of loans held for investment at June
30, 2023, compared to 5.19 percent at March 31, 2023. BHG also
increased its accrual for losses attributable to loan substitutions
and prepayments for loans previously sold through its community
bank auction platform to $369 million, or 5.87 percent of the loans
that have been previously sold and were unpaid, at June 30, 2023
compared to 5.81 percent at March 31, 2023.
- Noninterest expense for the quarter ended June 30, 2023 was
$211.6 million, compared to $211.7 million in the first quarter of
2023 and $196.0 million in the second quarter of 2022, reflecting a
year-over-year increase of 8.0 percent.
- Salaries and employee benefits were $132.4 million in the
second quarter of 2023, compared to $135.7 million in the first
quarter of 2023 and $126.6 million in the second quarter of 2022,
reflecting a year-over-year increase of 4.6 percent.
- Costs related to the firm's cash and equity incentive plans
were $23.2 million in the second quarter of 2023, compared to $22.5
million in the first quarter of 2023 and $31.1 million in the
second quarter of 2022.
- The reduction in salaries and employee benefits expense was
primarily due to the year-over-year decrease in the costs related
to the firm's annual cash and equity incentive plans. Offsetting
this decrease in part was the impact of full-time equivalent
associates increasing to 3,309.0 at June 30, 2023, from 3,074.0 at
June 30, 2022, a year-over-year increase in headcount of 7.6
percent.
- Noninterest expense categories, other than salaries and
employee benefits, were $79.2 million in the second quarter of
2023, compared to $76.0 million in the first quarter of 2023 and
$69.4 million in the second quarter of 2022, reflecting a
year-over-year increase of 14.1 percent.
"Our sale-leaseback transaction resulted in an $85.7 million
gain on the sale of fixed assets during the second quarter of
2023," said Harold R. Carpenter, Pinnacle's chief financial
officer. "We have reviewed the potential for a sale-leaseback
transaction on several occasions over the years. In the fourth
quarter of last year, as rates were increasing, it became much more
opportunistic. After much diligence, we elected to execute the
transaction during the second quarter of 2023.
"As to revenues for the second quarter, our net interest income
for the second quarter was up by $3.2 million from the first
quarter. Our current outlook is that growth in net interest income
for fiscal year 2023 over 2022 should approximate a low-teens
percentage increase. Net growth in fee income in the second quarter
of 2023 compared to the first quarter was largely attributable to
the gain on sale of fixed assets recognized in connection with the
sale-leaseback transaction, offset by $10.0 million in net losses
from the sale of investment securities. The second quarter sale of
investment securities provided us the opportunity to increase our
net interest income as the proceeds of the sale are now achieving a
higher yield and thus serve to minimize the financial impact of
higher lease occupancy costs from the sale-leaseback transaction.
BHG revenues also increased $7.8 million from the first to the
second quarter of 2023.
"Expenses were essentially flat when comparing second quarter to
first quarter of 2023. Salaries and employee benefits expense
decreased on a linked-quarter basis, as employee benefits were
seasonally lower in the second quarter of 2023 from the first
quarter. Occupancy expense increased this quarter as a result of
the sale-leaseback transaction. We anticipate a similar dollar
increase in occupancy costs next quarter given the sale-leaseback
transaction was consummated in multiple transactions that occurred
throughout the second quarter and thus will be fully integrated
into our results in the third quarter. We will continue to monitor
our expense burden in light of our anticipated revenue growth and
adjust incentives and/or reduce other expenses through either
reduced hiring, deferral of anticipated projects or implementation
of other cost-saving measures as required."
PROFITABILITY, LIQUIDITY AND SOUNDNESS:
Three months ended
Six months ended
June 30, 2023
March 31, 2023
June 30, 2022
June 30, 2023
June 30, 2022
Net interest margin
3.20
%
3.40
%
3.17
%
3.30
%
3.03
%
Efficiency ratio
43.26
%
52.70
%
50.26
%
47.52
%
51.66
%
Return on average assets
1.71
%
1.26
%
1.46
%
1.49
%
1.39
%
Return on average tangible common equity
(TCE)
21.06
%
15.43
%
17.62
%
18.33
%
16.63
%
As of
June 30, 2023
March 31, 2023
June 30, 2022
Shareholders' equity to total assets
12.5
%
12.6
%
13.2
%
Average loan to deposit ratio
84.94
%
83.97
%
80.67
%
Uninsured/uncollateralized deposits to
total deposits
28.31
%
33.23
%
41.38
%
Tangible common equity to tangible
assets
8.3
%
8.3
%
8.4
%
Book value per common share
$
73.32
$
71.24
$
66.74
Tangible book value per common share
$
48.85
$
46.75
$
42.08
Annualized net loan charge-offs to avg.
loans (1)
0.13
%
0.10
%
0.01
%
Nonperforming assets to total loans, ORE
and other nonperforming assets (NPAs)
0.15
%
0.15
%
0.09
%
Classified asset ratio (Pinnacle Bank)
(2)
3.30
%
2.70
%
2.90
%
Allowance for credit losses (ACL) to total
loans
1.08
%
1.04
%
1.03
%
(1):
Annualized net loan charge-offs
to average loans ratios are computed by annualizing quarterly net
loan charge-offs and dividing the result by average loans for the
quarter.
(2):
Classified assets as a percentage
of Tier 1 capital plus allowance for credit losses.
- Net interest margin was 3.20 percent for the second quarter of
2023, compared to 3.40 percent for the first quarter of 2023 and
3.17 percent for the second quarter of 2022.
- Provision for credit losses was $31.7 million in the second
quarter of 2023, compared to $18.8 million in the first quarter of
2023 and $12.9 million in the second quarter of 2022. Net
charge-offs were $9.8 million for the quarter ended June 30, 2023,
compared to $7.3 million for the quarter ended March 31, 2023 and
$877,000 for the quarter ended June 30, 2022. Annualized net
charge-offs for the second quarter of 2023 were 0.13 percent.
- Nonperforming assets were $47.4 million at June 30, 2023,
compared to $44.8 million at March 31, 2023 and $23.7 million at
June 30, 2022, up 100.0 percent over the same quarter last year.
The ratio of the allowance for credit losses to nonperforming loans
at June 30, 2023 was 762.0 percent, compared to 848.5 percent at
March 31, 2023 and 1,762.6 percent at June 30, 2022.
- Classified assets were $153.9 million at June 30, 2023,
compared to $120.3 million at March 31, 2023 and $112.5 at June 30,
2022, up 36.8 percent over the same quarter last year.
"Our net interest margin declined on a linked-quarter basis by
approximately 20 basis points," Carpenter said. "Increased deposit
pricing and the continued reduction in our noninterest-bearing
deposit account balances as a result of a shift in deposit mix were
the primary contributors to our decreased net interest margin. Also
contributing to the reduced net interest margin was an elevated
level of on-balance sheet liquidity, which, as we noted last
quarter, we acquired during mid-March given the heightened levels
of uncertainty in the broader banking industry. The impact of this
elevated liquidity should decrease over the remainder of 2023 as we
seek to deploy some of this excess into both loan growth and the
reduction of wholesale funding.
"We continue to experience reductions in our uninsured deposit
base, as approximately $1.9 billion in deposits were added to a
reciprocal deposit insurance funding network during the second
quarter, contributing to a reduction in our
uninsured/uncollateralized deposit base from approximately 33.2
percent at the end of the first quarter of 2023 to approximately
28.3 percent at the end of the second quarter of 2023.
"Our investment securities portfolio, including both the
held-to-maturity and available-for-sale portfolios, continues to
perform well for us though the value of these securities decreased
by approximately $255.4 million in the second quarter from the
first quarter, largely as a result of our decision to sell
approximately $174.0 million in securities in the second quarter of
2023. Our tangible book value per share also increased to $48.85 at
June 30, 2023 from $46.75 at March 31, 2023.
"Lastly, credit metrics have been largely consistent for an
extended period of time, and we expect those metrics to remain
consistent for the remainder of this year. We did record an
increased provision this quarter in comparison to last quarter and,
thus, increased the ratio of our allowance for credit losses to
total loans to 1.08 percent."
BOARD OF DIRECTORS DECLARES DIVIDENDS
On July 18, 2023, Pinnacle Financial's Board of Directors
approved a quarterly cash dividend of $0.22 per common share to be
paid on Aug. 25, 2023 to common shareholders of record as of the
close of business on Aug. 4, 2023. Additionally, the Board of
Directors approved a quarterly cash dividend of approximately $3.8
million, or $16.88 per share (or $0.422 per depositary share), on
Pinnacle Financial's 6.75 percent Series B Non-Cumulative Perpetual
Preferred Stock payable on Sept. 1, 2023 to shareholders of record
at the close of business on Aug. 17, 2023. The amount and timing of
any future dividend payments to both preferred and common
shareholders will be subject to the approval of Pinnacle's Board of
Directors.
WEBCAST AND CONFERENCE CALL INFORMATION
Pinnacle will host a webcast and conference call at 8:30 a.m.
CDT on July 19, 2023, to discuss second quarter 2023 results and
other matters. To access the call for audio only, please call
1-877-209-7255. 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 is the No. 1 bank in the Nashville-Murfreesboro-Franklin
MSA according to 2022 deposit data from the FDIC, is listed by
Forbes among the top 25 banks in the nation and earned a spot on
the 2022 list of 100 Best Companies to Work For® in the U.S., its
sixth consecutive appearance. Pinnacle was also listed in Fortune
magazine as the second best company to work for in the U.S. for
women. American Banker recognized Pinnacle as one of America’s Best
Banks to Work For nine years in a row and No. 1 among banks with
more than $11 billion in assets in 2021.
Pinnacle owns a 49 percent interest in Bankers Healthcare Group
(BHG), which provides innovative, hassle-free financial solutions
to healthcare practitioners and other professionals. Great Place to
Work and FORTUNE ranked BHG No. 4 on its 2021 list of Best
Workplaces in New York State in the small/medium business
category.
The firm began operations in a single location in downtown
Nashville, TN in October 2000 and has since grown to approximately
$46.9 billion in assets as of June 30, 2023. As the second-largest
bank holding company headquartered in Tennessee, Pinnacle operates
in 17 primarily urban markets and their surrounding
communities.
Additional information concerning Pinnacle, which is included in
the Nasdaq Financial-100 Index, can be accessed at
www.pnfp.com.
Forward-Looking Statements
All statements, other than statements of historical fact,
included in this press release, are forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995, Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. The words "expect,"
"anticipate," "intend," "may," "should," "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
statements. These forward-looking statements are subject to known
and unknown risks, uncertainties and other factors that could cause
the actual results to differ materially from the statements,
including, but not limited to: (i) deterioration in the financial
condition of borrowers of Pinnacle Bank and its subsidiaries or
BHG, including as a result of the negative impact of inflationary
pressures on our and BHG's customers and their businesses,
resulting in significant increases in loan losses and provisions
for those losses and, in the case of BHG, substitutions; (ii)
fluctuations or differences in interest rates on loans or deposits
from those that Pinnacle Financial is modeling or anticipating,
including as a result of Pinnacle Bank's inability to better match
deposit rates with the changes in the short-term rate environment,
or that affect the yield curve; (iii) the sale of investment
securities in a loss position before their value recovers,
including as a result of asset liability management strategies or
in response to liquidity needs; (iv) adverse conditions in the
national or local economies including in Pinnacle Financial's
markets throughout Tennessee, North Carolina, South Carolina,
Georgia, Alabama, Virginia and Kentucky, particularly in commercial
and residential real estate markets; (v) the inability of Pinnacle
Financial, or entities in which it has significant investments,
like BHG, to maintain the long-term historical growth rate of its,
or such entities', loan portfolio; (vi) the ability to grow and
retain low-cost core deposits and retain large, uninsured deposits,
including during times when Pinnacle Bank is seeking to limit the
rates it pays on deposits or uncertainty exists in the financial
services sector; (vii) changes in loan underwriting, credit review
or loss reserve policies associated with economic conditions,
examination conclusions, or regulatory developments; (viii)
effectiveness of Pinnacle Financial's asset management activities
in improving, resolving or liquidating lower-quality assets; (ix)
the impact of competition with other financial institutions,
including pricing pressures and the resulting impact on Pinnacle
Financial’s results, including as a result of the negative impact
to net interest margin from rising deposit and other funding costs;
(x) the results of regulatory examinations; (xi) Pinnacle
Financial's ability to identify potential candidates for,
consummate, and achieve synergies from, potential future
acquisitions; (xii) difficulties and delays in integrating acquired
businesses or fully realizing costs savings and other benefits from
acquisitions; (xiii) BHG's ability to profitably grow its business
and successfully execute on its business plans; (xiv) risks of
expansion into new geographic or product markets; (xv) any matter
that would cause Pinnacle Financial to conclude that there was
impairment of any asset, including goodwill or other intangible
assets; (xvi) the ineffectiveness of Pinnacle Bank's hedging
strategies, or the unexpected counterparty failure or hedge failure
of the underlying hedges; (xvii) reduced ability to attract
additional financial advisors (or failure of such advisors to cause
their clients to switch to Pinnacle Bank), to retain financial
advisors (including as a result of the competitive environment for
associates) or otherwise to attract customers from other financial
institutions; (xviii) deterioration in the valuation of other real
estate owned and increased expenses associated therewith; (xix)
inability to comply with regulatory capital requirements, including
those resulting from changes to capital calculation methodologies,
required capital maintenance levels or regulatory requests or
directives, particularly if Pinnacle Bank's level of applicable
commercial real estate loans were to exceed percentage levels of
total capital in guidelines recommended by its regulators; (xx)
approval of the declaration of any dividend by Pinnacle Financial's
board of directors; (xxi) the vulnerability of Pinnacle Bank's
network and online banking portals, and the systems of parties with
whom Pinnacle Bank contracts, to unauthorized access, computer
viruses, phishing schemes, spam attacks, human error, natural
disasters, power loss and other security breaches; (xxii) the
possibility of increased compliance and operational costs as a
result of increased regulatory oversight (including by the Consumer
Financial Protection Bureau), including oversight of companies in
which Pinnacle Financial or Pinnacle Bank have significant
investments, like BHG, and the development of additional banking
products for Pinnacle Bank's corporate and consumer clients;
(xxiii) the risks associated with Pinnacle Bank being a minority
investor in BHG, including the risk that the owners of a majority
of the equity interests in BHG decide to sell the company or all or
a portion of their ownership interests in BHG (triggering a similar
sale by Pinnacle Bank); (xxiv) changes in state and federal
legislation, regulations or policies applicable to banks and other
financial service providers, like BHG, including regulatory or
legislative developments; (xxv) fluctuations in the valuations of
Pinnacle Financial's equity investments and the ultimate success of
such investments; (xxvi) the availability of and access to capital;
(xxvii) adverse results (including costs, fines, reputational harm,
inability to obtain necessary approvals and/or other negative
effects) from current or future litigation, regulatory examinations
or other legal and/or regulatory actions; and (xxviii) general
competitive, economic, political and market conditions. Additional
factors which could affect the forward looking statements can be
found in Pinnacle Financial's Annual Report on Form 10-K for the
year ended December 31, 2022, and subsequently filed Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K filed with the
SEC and available on the SEC's website at http://www.sec.gov.
Pinnacle Financial disclaims any obligation to update or revise any
forward-looking statements contained in this press release, which
speak only as of the date hereof, whether as a result of new
information, future events or otherwise.
Non-GAAP Financial Matters
This release contains certain non-GAAP financial measures,
including, without limitation, total revenues, net income to common
shareholders, earnings per diluted common share, revenue per
diluted common share, PPNR, efficiency ratio, noninterest expense,
noninterest income and the ratio of noninterest expense to average
assets, excluding in certain instances the impact of expenses
related to other real estate owned, gains or losses on sale of
investment securities, gains associated with the sale-leaseback
transaction completed in the second quarter of 2023 and other
matters for the accounting periods presented. This release also
includes non-GAAP financial measures which exclude the impact of
loans originated and forgiven and repaid under the PPP. This
release may also contain certain other non-GAAP capital ratios and
performance measures that exclude the impact of goodwill and core
deposit intangibles associated with Pinnacle Financial's
acquisitions of BNC, Avenue Bank, Magna Bank, CapitalMark Bank
& Trust, Mid-America Bancshares, Inc., Cavalry Bancorp, Inc.
and other acquisitions which collectively are less material to the
non-GAAP measure as well as the impact of Pinnacle Financial's
Series B Preferred Stock. The presentation of the non-GAAP
financial information is not intended to be considered in isolation
or as a substitute for any measure prepared in accordance with
GAAP. Because non-GAAP financial measures presented in this release
are not measurements determined in accordance with GAAP and are
susceptible to varying calculations, these non-GAAP financial
measures, as presented, may not be comparable to other similarly
titled measures presented by other companies.
Pinnacle Financial believes that these non-GAAP financial
measures facilitate making period-to-period comparisons and are
meaningful indications of its operating performance. In addition,
because intangible assets such as goodwill and the core deposit
intangible, and the other items excluded each vary extensively from
company to company, Pinnacle Financial believes that the
presentation of this information allows investors to more easily
compare Pinnacle Financial's results to the results of other
companies. Pinnacle Financial's management utilizes this non-GAAP
financial information to compare Pinnacle Financial's operating
performance for 2023 versus certain periods in 2022 and to
internally prepared projections.
PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS –
UNAUDITED
(dollars in thousands, except for share
and per share data)
June 30, 2023
December 31, 2022
June 30, 2022
ASSETS
Cash and noninterest-bearing due from
banks
$
447,216
$
268,649
$
265,507
Restricted cash
22,567
31,447
29,739
Interest-bearing due from banks
3,363,348
877,286
1,336,667
Cash and cash equivalents
3,833,131
1,177,382
1,631,913
Securities purchased with agreement to
resell
507,235
513,276
1,328,876
Securities available-for-sale, at fair
value
3,591,280
3,558,870
3,809,338
Securities held-to-maturity (fair value of
$2.7 billion, $2.7 billion, and $2.5 billion, net of allowance for
credit losses of $1.7 million, $1.6 million, and $1.2 million at
June 30, 2023, Dec. 31, 2022, and June 30, 2022, respectively)
3,032,177
3,079,050
2,744,555
Consumer loans held-for-sale
85,981
42,237
67,467
Commercial loans held-for-sale
22,713
21,093
25,901
Loans
31,153,290
29,041,605
26,333,096
Less allowance for credit losses
(337,459
)
(300,665
)
(272,483
)
Loans, net
30,815,831
28,740,940
26,060,613
Premises and equipment, net
244,853
327,885
302,389
Equity method investment
461,596
443,185
403,191
Accrued interest receivable
164,854
161,182
116,038
Goodwill
1,846,973
1,846,973
1,846,466
Core deposits and other intangible
assets
30,981
34,555
37,617
Other real estate owned
2,555
7,952
8,237
Other assets
2,235,822
2,015,441
1,738,691
Total assets
$
46,875,982
$
41,970,021
$
40,121,292
LIABILITIES AND SHAREHOLDERS'
EQUITY
Deposits:
Noninterest-bearing
$
8,436,799
$
9,812,744
$
11,058,198
Interest-bearing
10,433,361
7,884,605
6,617,324
Savings and money market accounts
13,645,849
13,774,534
12,492,329
Time
5,206,652
3,489,355
2,427,452
Total deposits
37,722,661
34,961,238
32,595,303
Securities sold under agreements to
repurchase
163,774
194,910
199,585
Federal Home Loan Bank advances
2,200,917
464,436
1,289,059
Subordinated debt and other borrowings
424,497
424,055
423,614
Accrued interest payable
53,854
19,478
13,551
Other liabilities
466,520
386,512
284,941
Total liabilities
41,032,223
36,450,629
34,806,053
Preferred stock, no par value, 10.0
million shares authorized; 225,000 shares non-cumulative perpetual
preferred stock, Series B, liquidation preference $225.0 million,
issued and outstanding at June 30, 2023, Dec. 31, 2022, and June
30, 2022, respectively
217,126
217,126
217,126
Common stock, par value $1.00; 180.0
million shares authorized; 76.7 million, 76.5 million and 76.4
million shares issued and outstanding at June 30, 2023, Dec. 31,
2022, and June 30, 2022, respectively
76,740
76,454
76,385
Additional paid-in capital
3,087,967
3,074,867
3,056,228
Retained earnings
2,634,315
2,341,706
2,096,950
Accumulated other comprehensive loss, net
of taxes
(172,389
)
(190,761
)
(131,450
)
Total shareholders' equity
5,843,759
5,519,392
5,315,239
Total liabilities and shareholders'
equity
$
46,875,982
$
41,970,021
$
40,121,292
This information is preliminary
and based on company data available at the time of the
presentation.
PINNACLE FINANCIAL PARTNERS, INC. AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME –
UNAUDITED
(dollars in thousands, except for share
and per share data)
Three months ended
Six months ended
June 30, 2023
March 31, 2023
June 30, 2022
June 30, 2023
June 30, 2022
Interest income:
Loans, including fees
$
478,896
$
431,902
$
252,182
$
910,798
$
479,229
Securities
Taxable
31,967
29,358
12,725
61,325
23,773
Tax-exempt
24,603
23,802
19,898
48,405
37,344
Federal funds sold and other
39,773
20,977
7,571
60,750
10,647
Total interest income
575,239
506,039
292,376
1,081,278
550,993
Interest expense:
Deposits
228,668
176,589
18,181
405,257
28,431
Securities sold under agreements to
repurchase
783
595
82
1,378
138
FHLB advances and other borrowings
30,395
16,624
9,539
47,019
18,375
Total interest expense
259,846
193,808
27,802
453,654
46,944
Net interest income
315,393
312,231
264,574
627,624
504,049
Provision for credit losses
31,689
18,767
12,907
50,456
15,627
Net interest income after provision for
credit losses
283,704
293,464
251,667
577,168
488,422
Noninterest income:
Service charges on deposit accounts
12,180
11,718
11,616
23,898
22,646
Investment services
14,174
11,595
13,205
25,769
23,896
Insurance sales commissions
3,252
4,464
2,554
7,716
6,590
Gains on mortgage loans sold, net
1,567
2,053
2,150
3,620
6,216
Investment losses on sales, net
(9,961
)
—
—
(9,961
)
(61
)
Trust fees
6,627
6,429
6,065
13,056
12,038
Income from equity method investment
26,924
19,079
49,465
46,003
83,120
Gain on sale of fixed assets
85,724
135
65
85,859
198
Other noninterest income
33,352
34,056
40,382
67,408
74,355
Total noninterest income
173,839
89,529
125,502
263,368
228,998
Noninterest expense:
Salaries and employee benefits
132,443
135,708
126,611
268,151
248,463
Equipment and occupancy
33,706
30,353
26,921
64,059
52,457
Other real estate, net
58
99
86
157
191
Marketing and other business
development
5,664
5,942
4,759
11,606
8,536
Postage and supplies
2,863
2,819
2,320
5,682
4,691
Amortization of intangibles
1,780
1,794
2,051
3,574
3,922
Other noninterest expense
35,127
35,012
33,290
70,139
60,439
Total noninterest expense
211,641
211,727
196,038
423,368
378,699
Income before income taxes
245,902
171,266
181,131
417,168
338,721
Income tax expense
48,603
33,995
36,004
82,598
64,484
Net income
197,299
137,271
145,127
334,570
274,237
Preferred stock dividends
(3,798
)
(3,798
)
(3,798
)
(7,596
)
(7,596
)
Net income available to common
shareholders
$
193,501
$
133,473
$
141,329
$
326,974
$
266,641
Per share information:
Basic net income per common share
$
2.55
$
1.76
$
1.87
$
4.30
$
3.52
Diluted net income per common share
$
2.54
$
1.76
$
1.86
$
4.30
$
3.51
Weighted average common shares
outstanding:
Basic
76,030,081
75,921,282
75,751,296
75,975,982
75,703,407
Diluted
76,090,321
76,042,328
75,940,500
76,061,883
75,934,025
This information is preliminary
and based on company data available at the time of the
presentation.
PINNACLE FINANCIAL PARTNERS,
INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
SHAREHOLDERS' EQUITY
(Unaudited)
(dollars and shares in thousands)
Preferred Stock
Amount
Common Stock
Additional Paid -in
Capital
Retained Earnings
Accumulated Other Comp. Income
(Loss), net
Total Shareholders'
Equity
Shares
Amounts
Balance at December 31, 2021
$
217,126
76,143
$
76,143
$
3,045,802
$
1,864,350
$
107,186
$
5,310,607
Exercise of employee common stock options
& related tax benefits
—
14
14
309
—
—
323
Preferred dividends paid ($33.76 per
share)
—
—
—
—
(7,596
)
—
(7,596
)
Common dividends paid ($0.44 per
share)
—
—
—
—
(34,041
)
(34,041
)
Issuance of restricted common shares, net
of forfeitures
—
166
166
(166
)
—
—
—
Restricted shares withheld for taxes &
related tax benefits
—
(43
)
(43
)
(4,359
)
—
—
(4,402
)
Issuance of common stock pursuant to
restricted stock unit (RSU) and performance stock unit (PSU)
agreements, net of shares withheld for taxes & related tax
benefits
—
105
105
(5,566
)
—
—
(5,461
)
Compensation expense for restricted shares
& performance stock units
—
—
—
20,208
—
—
20,208
Net income
—
—
—
—
274,237
—
274,237
Other comprehensive loss
—
—
—
—
—
(238,636
)
(238,636
)
Balance at June 30, 2022
$
217,126
76,385
$
76,385
$
3,056,228
$
2,096,950
$
(131,450
)
$
5,315,239
Balance at December 31, 2022
$
217,126
76,454
$
76,454
$
3,074,867
$
2,341,706
$
(190,761
)
$
5,519,392
Exercise of employee common stock options
& related tax benefits
—
40
40
931
—
—
971
Preferred dividends paid ($33.76 per
share)
—
—
—
—
(7,596
)
—
(7,596
)
Common dividends paid ($0.44 per
share)
—
—
—
—
(34,365
)
—
(34,365
)
Issuance of restricted common shares, net
of forfeitures
—
200
200
(200
)
—
—
—
Restricted shares withheld for taxes &
related tax benefits
—
(47
)
(47
)
(3,345
)
—
—
(3,392
)
Issuance of common stock pursuant to RSU
and PSU agreements, net of shares withheld for taxes & related
tax benefits
—
93
93
(3,738
)
—
—
(3,645
)
Compensation expense for restricted shares
& performance stock units
—
—
—
19,452
—
—
19,452
Net income
—
—
—
—
334,570
—
334,570
Other comprehensive gain
—
—
—
—
—
18,372
18,372
Balance at June 30, 2023
$
217,126
76,740
$
76,740
$
3,087,967
$
2,634,315
$
(172,389
)
$
5,843,759
PINNACLE FINANCIAL PARTNERS, INC. AND
SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA –
UNAUDITED
(dollars in thousands)
June
March
December
September
June
March
2023
2023
2022
2022
2022
2022
Balance sheet data, at quarter
end:
Commercial and industrial loans
$
10,979,261
10,716,945
10,233,395
9,738,271
9,244,708
8,213,204
Commercial real estate - owner occupied
loans
3,845,359
3,686,796
3,587,257
3,426,271
3,243,018
3,124,275
Commercial real estate - investment
loans
5,682,652
5,556,484
5,277,454
5,122,127
4,909,598
4,707,761
Commercial real estate - multifamily and
other loans
1,488,236
1,331,249
1,265,165
1,042,854
951,998
718,822
Consumer real estate - mortgage loans
4,692,673
4,531,285
4,435,046
4,271,913
4,047,051
3,813,252
Construction and land development
loans
3,904,774
3,909,024
3,679,498
3,548,970
3,386,866
3,277,029
Consumer and other loans
555,685
559,706
555,823
550,565
498,757
487,499
Paycheck protection program loans
4,650
6,382
7,967
10,723
51,100
157,180
Total loans
31,153,290
30,297,871
29,041,605
27,711,694
26,333,096
24,499,022
Allowance for credit losses
(337,459
)
(313,841
)
(300,665
)
(288,088
)
(272,483
)
(261,618
)
Securities
6,623,457
6,878,831
6,637,920
6,481,018
6,553,893
6,136,109
Total assets
46,875,982
45,119,587
41,970,021
41,000,118
40,121,292
39,400,378
Noninterest-bearing deposits
8,436,799
9,018,439
9,812,744
10,567,873
11,058,198
10,986,194
Total deposits
37,722,661
36,178,553
34,961,238
33,690,049
32,595,303
32,295,814
Securities sold under agreements to
repurchase
163,774
149,777
194,910
190,554
199,585
219,530
FHLB advances
2,200,917
2,166,508
464,436
889,248
1,289,059
888,870
Subordinated debt and other borrowings
424,497
424,276
424,055
423,834
423,614
423,319
Total shareholders' equity
5,843,759
5,684,128
5,519,392
5,342,112
5,315,239
5,280,950
Balance sheet data, quarterly
averages:
Total loans
$
30,882,205
29,633,640
28,402,197
27,021,031
25,397,389
23,848,533
Securities
6,722,247
6,765,126
6,537,262
6,542,026
6,446,774
6,143,664
Federal funds sold and other
3,350,705
2,100,757
1,828,588
2,600,978
2,837,679
4,799,946
Total earning assets
40,955,157
38,499,523
36,768,047
36,164,035
34,681,842
34,792,143
Total assets
45,411,961
42,983,854
41,324,251
40,464,649
38,780,786
38,637,221
Noninterest-bearing deposits
8,599,781
9,332,317
10,486,233
10,926,069
10,803,439
10,478,403
Total deposits
36,355,859
35,291,775
34,177,281
33,108,415
31,484,100
31,538,985
Securities sold under agreements to
repurchase
162,429
219,082
199,610
215,646
216,846
179,869
FHLB advances
2,352,045
1,130,356
701,813
1,010,865
1,095,531
888,746
Subordinated debt and other borrowings
426,712
426,564
427,503
426,267
427,191
441,755
Total shareholders' equity
5,782,239
5,605,604
5,433,274
5,403,244
5,316,219
5,331,405
Statement of operations data, for the
three months ended:
Interest income
$
575,239
506,039
451,178
371,764
292,376
258,617
Interest expense
259,846
193,808
131,718
65,980
27,802
19,142
Net interest income
315,393
312,231
319,460
305,784
264,574
239,475
Provision for credit losses
31,689
18,767
24,805
27,493
12,907
2,720
Net interest income after provision for
credit losses
283,704
293,464
294,655
278,291
251,667
236,755
Noninterest income
173,839
89,529
82,321
104,805
125,502
103,496
Noninterest expense
211,641
211,727
202,047
199,253
196,038
182,661
Income before income taxes
245,902
171,266
174,929
183,843
181,131
157,590
Income tax expense
48,603
33,995
37,082
35,185
36,004
28,480
Net income
197,299
137,271
137,847
148,658
145,127
129,110
Preferred stock dividends
(3,798
)
(3,798
)
(3,798
)
(3,798
)
(3,798
)
(3,798
)
Net income available to common
shareholders
$
193,501
133,473
134,049
144,860
141,329
125,312
Profitability and other ratios:
Return on avg. assets (1)
1.71
%
1.26
%
1.29
%
1.42
%
1.46
%
1.32
%
Return on avg. equity (1)
13.42
%
9.66
%
9.79
%
10.64
%
10.66
%
9.53
%
Return on avg. common equity (1)
13.95
%
10.05
%
10.20
%
11.08
%
11.12
%
9.94
%
Return on avg. tangible common equity
(1)
21.06
%
15.43
%
15.95
%
17.40
%
17.62
%
15.63
%
Common stock dividend payout ratio
(14)
11.04
%
12.07
%
12.26
%
12.34
%
12.63
%
12.94
%
Net interest margin (2)
3.20
%
3.40
%
3.60
%
3.47
%
3.17
%
2.89
%
Noninterest income to total revenue
(3)
35.53
%
22.28
%
20.49
%
25.53
%
32.17
%
30.18
%
Noninterest income to avg. assets (1)
1.54
%
0.84
%
0.79
%
1.03
%
1.30
%
1.09
%
Noninterest exp. to avg. assets (1)
1.87
%
2.00
%
1.94
%
1.95
%
2.03
%
1.92
%
Efficiency ratio (4)
43.26
%
52.70
%
50.29
%
48.53
%
50.26
%
53.26
%
Avg. loans to avg. deposits
84.94
%
83.97
%
83.10
%
81.61
%
80.67
%
75.62
%
Securities to total assets
14.13
%
15.25
%
15.82
%
15.81
%
16.34
%
15.57
%
This information is preliminary
and based on company data available at the time of the
presentation.
PINNACLE FINANCIAL PARTNERS, INC. AND
SUBSIDIARIES
ANALYSIS OF INTEREST INCOME AND
EXPENSE, RATES AND YIELDS-UNAUDITED
(dollars in thousands)
Three months ended
Three months ended
June 30, 2023
June 30, 2022
Average Balances
Interest
Rates/ Yields
Average Balances
Interest
Rates/ Yields
Interest-earning assets
Loans (1) (2)
$
30,882,205
$
478,896
6.30
%
$
25,397,389
$
252,182
4.07
%
Securities
Taxable
3,394,507
31,967
3.78
%
3,420,950
12,725
1.49
%
Tax-exempt (2)
3,327,740
24,603
3.54
%
3,025,824
19,898
3.19
%
Interest-bearing due from banks
2,597,020
33,234
5.13
%
1,332,463
2,611
0.79
%
Resell agreements
509,694
3,374
2.65
%
1,326,790
3,844
1.16
%
Federal funds sold
—
—
—
%
—
—
—
%
Other
243,991
3,165
5.20
%
178,426
1,116
2.51
%
Total interest-earning assets
40,955,157
$
575,239
5.74
%
34,681,842
$
292,376
3.49
%
Nonearning assets
Intangible assets
1,879,108
1,882,546
Other nonearning assets
2,577,696
2,216,398
Total assets
$
45,411,961
$
38,780,786
Interest-bearing liabilities
Interest-bearing deposits:
Interest checking
9,361,316
75,815
3.25
%
6,520,804
6,134
0.38
%
Savings and money market
13,684,536
110,024
3.22
%
12,084,911
9,071
0.30
%
Time
4,710,226
42,829
3.65
%
2,074,946
2,976
0.58
%
Total interest-bearing deposits
27,756,078
228,668
3.30
%
20,680,661
18,181
0.35
%
Securities sold under agreements to
repurchase
162,429
783
1.93
%
216,846
82
0.15
%
Federal Home Loan Bank advances
2,352,045
24,603
4.20
%
1,095,531
5,231
1.92
%
Subordinated debt and other borrowings
426,712
5,792
5.44
%
427,191
4,308
4.04
%
Total interest-bearing liabilities
30,697,264
259,846
3.40
%
22,420,229
27,802
0.50
%
Noninterest-bearing deposits
8,599,781
—
—
10,803,439
—
—
Total deposits and interest-bearing
liabilities
39,297,045
$
259,846
2.65
%
33,223,668
$
27,802
0.34
%
Other liabilities
332,677
240,899
Shareholders' equity
5,782,239
5,316,219
Total liabilities and shareholders'
equity
$
45,411,961
$
38,780,786
Net interest
income
$
315,393
$
264,574
Net interest spread (3)
2.35
%
2.99
%
Net interest margin (4)
3.20
%
3.17
%
(1) Average balances of nonperforming
loans are included in the above amounts.
(2) Yields computed on tax-exempt
instruments on a tax equivalent basis and included $11.2 million of
taxable equivalent income for the three months ended June 30, 2023
compared to $9.6 million for the three months ended June 30, 2022.
The tax-exempt benefit has been reduced by the projected impact of
tax-exempt income that will be disallowed pursuant to IRS
Regulations as of and for the then current period presented.
(3) Yields realized on interest-bearing
assets less the rates paid on interest-bearing liabilities. The net
interest spread calculation excludes the impact of demand deposits.
Had the impact of demand deposits been included, the net interest
spread for the three months ended June 30, 2023 would have been
3.09% compared to a net interest spread of 3.16% for the three
months ended June 30, 2022.
(4) Net interest margin is the result of
annualized net interest income calculated on a tax equivalent basis
divided by average interest-earning assets for the period.
This information is preliminary and based
on company data available at the time of the presentation.
PINNACLE FINANCIAL PARTNERS, INC. AND
SUBSIDIARIES
ANALYSIS OF INTEREST INCOME AND
EXPENSE, RATES AND YIELDS-UNAUDITED
(dollars in thousands)
Six months ended
Six months ended
June 30, 2023
June 30, 2022
Average Balances
Interest
Rates/ Yields
Average Balances
Interest
Rates/ Yields
Interest-earning assets
Loans (1) (2)
$
30,261,372
$
910,798
6.15
%
$
24,627,240
$
479,229
4.01
%
Securities
Taxable
3,451,410
61,325
3.58
%
3,381,538
23,773
1.42
%
Tax-exempt (2)
3,292,158
48,405
3.54
%
2,914,519
37,344
3.12
%
Interest-bearing due from banks
1,998,083
49,166
4.96
%
2,334,566
3,914
0.34
%
Resell agreements
511,169
6,703
2.64
%
1,304,392
5,058
0.78
%
Federal funds sold
—
—
—
%
—
—
—
%
Other
219,932
4,881
4.48
%
174,434
1,675
1.94
%
Total interest-earning assets
39,734,124
$
1,081,278
5.60
%
34,736,689
$
550,993
3.30
%
Nonearning assets
Intangible assets
1,879,994
1,873,190
Other nonearning assets
2,590,548
2,099,522
Total assets
$
44,204,666
$
38,709,401
Interest-bearing liabilities
Interest-bearing deposits:
Interest checking
8,581,899
128,289
3.01
%
6,456,418
8,733
0.27
%
Savings and money market
14,029,351
207,543
2.98
%
12,334,678
14,195
0.23
%
Time
4,251,481
69,425
3.29
%
2,078,477
5,503
0.53
%
Total interest-bearing deposits
26,862,731
405,257
3.04
%
20,869,573
28,431
0.27
%
Securities sold under agreements to
repurchase
190,599
1,378
1.46
%
198,459
138
0.14
%
Federal Home Loan Bank advances
1,744,575
35,574
4.11
%
992,710
9,705
1.97
%
Subordinated debt and other borrowings
426,638
11,445
5.41
%
434,433
8,670
4.02
%
Total interest-bearing liabilities
29,224,543
453,654
3.13
%
22,495,175
46,944
0.42
%
Noninterest-bearing deposits
8,964,026
—
—
10,641,819
—
—
Total deposits and interest-bearing
liabilities
38,188,569
$
453,654
2.40
%
33,136,994
$
46,944
0.29
%
Other liabilities
321,637
248,637
Shareholders' equity
5,694,460
5,323,770
Total liabilities and shareholders'
equity
$
44,204,666
$
38,709,401
Net interest
income
$
627,624
$
504,049
Net interest spread (3)
2.47
%
2.88
%
Net interest margin (4)
3.30
%
3.03
%
(1) Average balances of nonperforming
loans are included in the above amounts.
(2) Yields computed on tax-exempt
instruments on a tax equivalent basis and included $22.1 million of
taxable equivalent income for the six months ended June 30, 2023
compared to $18.1 million for the six months ended June 30, 2022.
The tax-exempt benefit has been reduced by the projected impact of
tax-exempt income that will be disallowed pursuant to IRS
Regulations as of and for the then current period presented.
(3) Yields realized on interest-bearing
assets less the rates paid on interest-bearing liabilities. The net
interest spread calculation excludes the impact of demand deposits.
Had the impact of demand deposits been included, the net interest
spread for the six months ended June 30, 2023 would have been 3.20%
compared to a net interest spread of 3.02% for the six months ended
June 30, 2022.
(4) Net interest margin is the result of
annualized net interest income calculated on a tax equivalent basis
divided by average interest-earning assets for the period.
This information is preliminary and based
on company data available at the time of the presentation.
PINNACLE FINANCIAL PARTNERS, INC. AND
SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA –
UNAUDITED
(dollars in thousands)
June
March
December
September
June
March
2023
2023
2022
2022
2022
2022
Asset quality information and
ratios:
Nonperforming assets:
Nonaccrual loans
$
44,289
36,988
38,116
34,115
15,459
26,616
ORE and other nonperforming assets
(NPAs)
3,105
7,802
7,952
7,787
8,237
8,437
Total nonperforming assets
$
47,394
44,790
46,068
41,902
23,696
35,053
Past due loans over 90 days and still
accruing interest
$
5,257
5,284
4,406
6,757
3,840
1,605
Accruing purchase credit deteriorated
loans
$
7,415
7,684
8,060
8,759
9,194
12,661
Net loan charge-offs
$
9,771
7,291
11,729
10,983
877
2,958
Allowance for credit losses to nonaccrual
loans
762.0
%
848.5
%
788.8
%
844.5
%
1,762.6
%
982.9
%
As a percentage of total loans:
Past due accruing loans over 30 days
0.14
%
0.14
%
0.15
%
0.13
%
0.11
%
0.11
%
Potential problem loans
0.32
%
0.22
%
0.19
%
0.21
%
0.32
%
0.41
%
Allowance for credit losses
1.08
%
1.04
%
1.04
%
1.04
%
1.03
%
1.07
%
Nonperforming assets to total loans, ORE
and other NPAs
0.15
%
0.15
%
0.16
%
0.15
%
0.09
%
0.14
%
Classified asset ratio (Pinnacle Bank)
(6)
3.3
%
2.7
%
2.4
%
2.6
%
2.9
%
3.6
%
Annualized net loan charge-offs to avg.
loans (5)
0.13
%
0.10
%
0.17
%
0.16
%
0.01
%
0.05
%
Interest rates and yields:
Loans
6.30
%
6.00
%
5.54
%
4.73
%
4.07
%
3.94
%
Securities
3.66
%
3.47
%
3.19
%
2.66
%
2.29
%
2.12
%
Total earning assets
5.74
%
5.45
%
5.02
%
4.20
%
3.49
%
3.11
%
Total deposits, including non-interest
bearing
2.52
%
2.03
%
1.40
%
0.66
%
0.23
%
0.13
%
Securities sold under agreements to
repurchase
1.93
%
1.10
%
0.94
%
0.34
%
0.15
%
0.13
%
FHLB advances
4.20
%
3.94
%
3.04
%
2.26
%
1.92
%
2.04
%
Subordinated debt and other borrowings
5.44
%
5.38
%
4.98
%
4.51
%
4.04
%
4.00
%
Total deposits and interest-bearing
liabilities
2.65
%
2.12
%
1.47
%
0.75
%
0.34
%
0.23
%
Capital and other ratios (6):
Pinnacle Financial ratios:
Shareholders' equity to total assets
12.5
%
12.6
%
13.2
%
13.0
%
13.2
%
13.4
%
Common equity Tier one
10.2
%
9.9
%
10.0
%
10.0
%
10.2
%
10.5
%
Tier one risk-based
10.8
%
10.5
%
10.5
%
10.7
%
10.9
%
11.2
%
Total risk-based
12.7
%
12.4
%
12.4
%
12.6
%
12.9
%
13.3
%
Leverage
9.5
%
9.6
%
9.7
%
9.7
%
9.8
%
9.5
%
Tangible common equity to tangible
assets
8.3
%
8.3
%
8.5
%
8.3
%
8.4
%
8.5
%
Pinnacle Bank ratios:
Common equity Tier one
11.1
%
10.8
%
10.9
%
11.1
%
11.0
%
11.4
%
Tier one risk-based
11.1
%
10.8
%
10.9
%
11.1
%
11.0
%
11.4
%
Total risk-based
11.9
%
11.6
%
11.6
%
11.8
%
11.7
%
12.1
%
Leverage
9.8
%
9.9
%
10.1
%
10.1
%
9.9
%
9.6
%
Construction and land development loans as
a percentage of total capital (17)
84.5
%
88.5
%
85.9
%
85.4
%
87.4
%
87.4
%
Non-owner occupied commercial real estate
and multi-family as a percentage of total capital (17)
256.7
%
261.1
%
249.6
%
244.0
%
250.2
%
243.7
%
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)
June
March
December
September
June
March
2023
2023
2022
2022
2022
2022
Per share data:
Earnings per common share – basic
$
2.55
1.76
1.77
1.91
1.87
1.66
Earnings per common share - basic,
excluding non-GAAP adjustments
$
1.80
1.76
1.77
1.91
1.87
1.66
Earnings per common share – diluted
$
2.54
1.76
1.76
1.91
1.86
1.65
Earnings per common share - diluted,
excluding non-GAAP adjustments
$
1.79
1.76
1.76
1.91
1.86
1.65
Common dividends per share
$
0.22
0.22
0.22
0.22
0.22
0.22
Book value per common share at quarter end
(7)
$
73.32
71.24
69.35
67.07
66.74
66.30
Tangible book value per common share at
quarter end (7)
$
48.85
46.75
44.74
42.44
42.08
41.65
Revenue per diluted common share
$
6.43
5.28
5.27
5.40
5.14
4.52
Revenue per diluted common share,
excluding non-GAAP adjustments
$
5.43
5.28
5.27
5.40
5.14
4.52
Investor information:
Closing sales price of common stock on
last trading day of quarter
$
56.65
55.16
73.40
81.10
72.31
92.08
High closing sales price of common stock
during quarter
$
57.93
82.79
87.81
87.66
91.42
110.41
Low closing sales price of common stock
during quarter
$
46.17
52.51
70.74
68.68
68.56
90.46
Closing sales price of depositary shares
on last trading day of quarter
$
23.75
24.15
25.35
25.33
25.19
26.72
High closing sales price of depositary
shares during quarter
$
24.90
25.71
25.60
26.23
26.44
28.53
Low closing sales price of depositary
shares during quarter
$
19.95
20.77
23.11
24.76
24.75
25.63
Other information:
Residential mortgage loan sales:
Gross loans sold
$
192,948
120,146
134,514
181,139
239,736
270,793
Gross fees (8)
$
4,133
2,795
3,149
3,189
6,523
5,700
Gross fees as a percentage of loans
originated
2.14
%
2.33
%
2.34
%
1.76
%
2.72
%
2.11
%
Net gain (loss) on residential mortgage
loans sold
$
1,567
2,053
(65
)
1,117
2,150
4,066
Investment gains (losses) on sales of
securities, net (13)
$
(9,961
)
—
—
217
—
(61
)
Brokerage account assets, at quarter end
(9)
$
9,007,230
8,634,339
8,049,125
7,220,405
6,761,480
7,158,939
Trust account managed assets, at quarter
end
$
5,084,592
4,855,951
4,560,752
4,162,639
4,207,406
4,499,911
Core deposits (10)
$
32,780,767
32,054,111
31,301,077
30,748,817
30,011,444
30,398,683
Core deposits to total funding (10)
80.9
%
82.4
%
86.8
%
87.4
%
87.0
%
89.9
%
Risk-weighted assets
$
38,853,588
38,117,659
36,216,901
35,281,315
33,366,074
31,170,258
Number of offices
127
126
123
120
119
119
Total core deposits per office
$
258,116
254,398
254,480
256,240
252,197
255,451
Total assets per full-time equivalent
employee
$
14,166
13,750
12,948
12,875
13,052
13,186
Annualized revenues per full-time
equivalent employee
$
593.0
496.5
491.8
511.5
509.0
465.5
Annualized expenses per full-time
equivalent employee
$
256.5
261.7
247.3
248.2
255.8
247.9
Number of employees (full-time
equivalent)
3,309.0
3,281.5
3,241.5
3,184.5
3,074.0
2,988.0
Associate retention rate (11)
94.1
%
93.8
%
93.8
%
93.6
%
93.3
%
93.1
%
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
Three months ended
Six months ended
(dollars in thousands, except per share
data)
June
March
June
June
June
2023
2023
2022
2023
2022
Net interest income
$
315,393
312,231
264,574
627,624
504,049
Noninterest income
173,839
89,529
125,502
263,368
228,998
Total revenues
489,232
401,760
390,076
890,992
733,047
Less: Investment losses on sales of
securities, net
9,961
—
—
9,961
61
Gain on sale of fixed assets as a result
of sale-leaseback transaction
(85,692
)
—
—
(85,692
)
—
Total revenues excluding the impact of
adjustments noted above
$
413,501
401,760
390,076
815,261
733,108
Noninterest expense
$
211,641
211,727
196,038
423,368
378,699
Less: ORE expense
58
99
86
157
191
Noninterest expense excluding the impact
of adjustments noted above
$
211,583
211,628
195,952
423,211
378,508
Pre-tax income
$
245,902
171,266
181,131
417,168
338,721
Provision for credit losses
31,689
18,767
12,907
50,456
15,627
Pre-tax pre-provision net revenue
277,591
190,033
194,038
467,624
354,348
Less: Adjustments noted above
(75,673
)
99
86
(75,574
)
252
Adjusted pre-tax pre-provision net revenue
(12)
$
201,918
190,132
194,124
392,050
354,600
Noninterest income
$
173,839
89,529
125,502
263,368
228,998
Less: Adjustments noted above
(75,731
)
—
—
(75,731
)
61
Noninterest income excluding the impact of
adjustments noted above
$
98,108
89,529
125,502
187,637
229,059
Efficiency ratio (4)
43.26
%
52.70
%
50.26
%
47.52
%
51.66
%
Adjustments noted above
7.91
%
(0.02
)%
(0.03
)%
4.39
%
(0.03
)%
Efficiency ratio excluding adjustments
noted above (4)
51.17
%
52.68
%
50.23
%
51.91
%
51.63
%
Total average assets
$
45,411,961
42,983,854
38,780,786
44,204,666
38,709,401
Noninterest income to average assets
(1)
1.54
%
0.84
%
1.30
%
1.20
%
1.19
%
Less: Adjustments noted above
(0.67
)%
—
%
—
%
(0.34
)%
—
%
Noninterest income (excluding adjustments
noted above) to average assets (1)
0.87
%
0.84
%
1.30
%
0.86
%
1.19
%
Noninterest expense to average assets
(1)
1.87
%
2.00
%
2.03
%
1.93
%
1.97
%
Adjustments as noted above
—
%
—
%
—
%
—
%
—
%
Noninterest expense (excluding adjustments
noted above) to average assets (1)
1.87
%
2.00
%
2.03
%
1.93
%
1.97
%
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
Three months ended
(dollars in thousands, except per share
data)
June
March
December
September
June
March
2023
2023
2022
2022
2022
2022
Net income available to common
shareholders
$
193,501
133,473
134,049
144,860
141,329
125,312
Investment (gains) losses on sales of
securities, net
9,961
—
—
(217
)
—
61
Gain on sale of fixed assets as a result
of sale-leaseback transaction
(85,692
)
—
—
—
—
—
ORE expense (benefit)
58
99
179
(90
)
86
105
Tax effect on adjustments noted above
(16)
18,918
(25
)
(47
)
80
(22
)
(43
)
Net income available to common
shareholders excluding adjustments noted above
$
136,746
133,547
134,181
144,633
141,393
125,435
Basic earnings per common share
$
2.55
1.76
1.77
1.91
1.87
1.66
Adjustment due to investment (gains)
losses on sales of securities, net
0.13
—
—
—
—
—
Adjustment due to gain on sale of fixed
assets as a result of sale-leaseback transaction
(1.13
)
—
—
—
—
—
Adjustment due to ORE expense
(benefit)
—
—
—
—
—
—
Adjustment due to tax effect on
adjustments noted above (16)
0.25
—
—
—
—
—
Basic earnings per common share excluding
adjustments noted above
$
1.80
1.76
1.77
1.91
1.87
1.66
Diluted earnings per common share
$
2.54
1.76
1.76
1.91
1.86
1.65
Adjustment due to investment (gains)
losses on sales of securities, net
0.13
—
—
—
—
—
Adjustment due to gain on sale of fixed
assets as a result of sale-leaseback transaction
(1.13
)
—
—
—
—
—
Adjustment due to ORE expense
(benefit)
—
—
—
—
—
—
Adjustment due to tax effect on
adjustments noted above (16)
0.25
—
—
—
—
—
Diluted earnings per common share
excluding the adjustments noted above
$
1.79
1.76
1.76
1.91
1.86
1.65
Revenue per diluted common share
$
6.43
5.28
5.27
5.40
5.14
4.52
Adjustments due to revenue-impacting items
as noted above
(1.00
)
—
—
—
—
—
Revenue per diluted common share excluding
adjustments due to revenue-impacting items as noted above
$
5.43
5.28
5.27
5.40
5.14
4.52
Book value per common share at quarter end
(7)
$
73.32
71.24
69.35
67.07
66.74
66.30
Adjustment due to goodwill, core deposit
and other intangible assets
(24.47
)
(24.49
)
(24.61
)
(24.63
)
(24.66
)
(24.65
)
Tangible book value per common share at
quarter end (7)
$
48.85
46.75
44.74
42.44
42.08
41.65
Equity method investment (15)
Fee income from BHG, net of
amortization
$
26,924
19,079
21,005
41,341
49,465
33,655
Funding cost to support investment
5,995
5,093
4,586
3,891
1,998
666
Pre-tax impact of BHG
20,929
13,986
16,419
37,450
47,467
32,989
Income tax expense at statutory rates
(16)
5,232
3,497
4,292
9,789
12,408
8,623
Earnings attributable to BHG
$
15,697
10,489
12,127
27,661
35,059
24,366
Basic earnings per common share
attributable to BHG
$
0.21
0.14
0.16
0.37
0.46
0.32
Diluted earnings per common share
attributable to BHG
$
0.21
0.14
0.16
0.36
0.46
0.32
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
Six months ended
(dollars in thousands, except per share
data)
June 30,
2023
2022
Net income available to common
shareholders
$
326,974
266,641
Investment losses on sales of securities,
net
9,961
61
Gain on sale of fixed assets as a result
of sale-leaseback transaction
(85,692
)
—
ORE expense
157
191
Tax effect on adjustments noted above
(16)
18,894
(66
)
Net income available to common
shareholders excluding adjustments noted above
$
270,294
266,827
Basic earnings per common share
$
4.30
3.52
Adjustment due to investment losses on
sales of securities, net
0.13
—
Adjustment due to gain on sale of fixed
assets as a result of sale-leaseback transaction
(1.13
)
—
Adjustment due to ORE expense
—
—
Adjustment due to tax effect on
adjustments noted above (16)
0.25
—
Basic earnings per common share excluding
adjustments noted above
$
3.55
3.52
Diluted earnings per common share
4.30
3.51
Adjustment due to investment losses on
sales of securities, net
0.13
—
Adjustment due to gain on sale of fixed
assets as a result of sale-leaseback transaction
(1.13
)
—
Adjustment due to ORE expense
—
—
Adjustment due to tax effect on
adjustments noted above (16)
0.25
—
Diluted earnings per common share
excluding the adjustments noted above
$
3.55
3.51
Revenue per diluted common share
$
11.71
9.65
Adjustments due to revenue-impacting items
as noted above
(0.99
)
—
Revenue per diluted common share excluding
adjustments due to revenue-impacting items noted above
$
10.72
9.65
Equity method investment (15)
Fee income from BHG, net of
amortization
$
46,003
83,120
Funding cost to support investment
11,088
2,664
Pre-tax impact of BHG
34,915
80,456
Income tax expense at statutory rates
(16)
8,729
21,031
Earnings attributable to BHG
$
26,186
59,425
Basic earnings per common share
attributable to BHG
$
0.34
0.78
Diluted earnings per common share
attributable to BHG
$
0.34
0.78
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
Three months ended
Six months ended
(dollars in thousands, except per share
data)
June
March
June
June
June
2023
2023
2022
2023
2022
Return on average assets (1)
1.71
%
1.26
%
1.46
%
1.49
%
1.39
%
Adjustments as noted above
(0.50
)%
—
%
—
%
(0.26
)%
—
%
Return on average assets excluding
adjustments noted above (1)
1.21
%
1.26
%
1.46
%
1.23
%
1.39
%
Tangible assets:
Total assets
$
46,875,982
45,119,587
40,121,292
$
46,875,982
40,121,292
Less: Goodwill
(1,846,973
)
(1,846,973
)
(1,846,466
)
(1,846,973
)
(1,846,466
)
Core deposit and other intangible
assets
(30,981
)
(32,761
)
(37,617
)
(30,981
)
(37,617
)
Net tangible assets
$
44,998,028
43,239,853
38,237,209
$
44,998,028
38,237,209
Tangible common equity:
Total shareholders' equity
$
5,843,759
5,684,128
5,315,239
$
5,843,759
5,315,239
Less: Preferred shareholders' equity
(217,126
)
(217,126
)
(217,126
)
(217,126
)
(217,126
)
Total common shareholders' equity
5,626,633
5,467,002
5,098,113
5,626,633
5,098,113
Less: Goodwill
(1,846,973
)
(1,846,973
)
(1,846,466
)
(1,846,973
)
(1,846,466
)
Core deposit and other intangible
assets
(30,981
)
(32,761
)
(37,617
)
(30,981
)
(37,617
)
Net tangible common equity
$
3,748,679
3,587,268
3,214,030
$
3,748,679
3,214,030
Ratio of tangible common equity to
tangible assets
8.33
%
8.30
%
8.41
%
8.33
%
8.41
%
Average tangible assets:
Average assets
$
45,411,961
42,983,854
38,780,786
$
44,204,666
38,709,401
Less: Average goodwill
(1,846,973
)
(1,846,973
)
(1,851,137
)
(1,846,973
)
(1,840,902
)
Average core deposit and other intangible
assets
(32,135
)
(33,917
)
(31,409
)
(33,021
)
(32,288
)
Net average tangible assets
$
43,532,853
41,102,964
36,898,240
$
42,324,672
36,836,211
Return on average assets (1)
1.71
%
1.26
%
1.46
%
1.49
%
1.39
%
Adjustment due to goodwill, core deposit
and other intangible assets
0.07
%
0.06
%
0.08
%
0.07
%
0.07
%
Return on average tangible assets (1)
1.78
%
1.32
%
1.54
%
1.56
%
1.46
%
Adjustments as noted above
(0.52
)%
—
%
—
%
(0.27
)%
—
%
Return on average tangible assets
excluding adjustments noted above (1)
1.26
%
1.32
%
1.54
%
1.29
%
1.46
%
Average tangible common equity:
Average shareholders' equity
$
5,782,239
5,605,604
5,316,219
$
5,694,460
5,323,770
Less: Average preferred equity
(217,126
)
(217,126
)
(217,126
)
(217,126
)
(217,126
)
Average common equity
5,565,113
5,388,478
5,099,093
5,477,334
5,106,644
Less: Average goodwill
(1,846,973
)
(1,846,973
)
(1,851,137
)
(1,846,973
)
(1,840,902
)
Average core deposit and other intangible
assets
(32,135
)
(33,917
)
(31,409
)
(33,021
)
(32,288
)
Net average tangible common equity
$
3,686,005
3,507,588
3,216,547
$
3,597,340
3,233,454
Return on average equity (1)
13.42
%
9.66
%
10.66
%
11.58
%
10.10
%
Adjustment due to average preferred
shareholders' equity
0.53
%
0.39
%
0.46
%
0.46
%
0.43
%
Return on average common equity (1)
13.95
%
10.05
%
11.12
%
12.04
%
10.53
%
Adjustment due to goodwill, core deposit
and other intangible assets
7.11
%
5.38
%
6.50
%
6.29
%
6.10
%
Return on average tangible common equity
(1)
21.06
%
15.43
%
17.62
%
18.33
%
16.63
%
Adjustments as noted above
(6.18
)%
0.01
%
0.01
%
(3.18
)%
0.01
%
Return on average tangible common equity
excluding adjustments noted above (1)
14.88
%
15.44
%
17.63
%
15.15
%
16.64
%
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
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. Annualized net loan charge-offs to
average loans ratios are computed by annualizing quarter-to-date
net loan charge-offs and dividing the result by average loans for
the quarter-to-date period.
6. Capital ratios are calculated using
regulatory reporting regulations enacted for such period and are
defined as follows:
Equity to total assets – End of period
total shareholders' equity as a percentage of end of period
assets.
Tangible common equity to tangible assets
- End of period total shareholders' equity less end of period
preferred stock, goodwill, core deposit and other intangibles as a
percentage of end of period assets less end of period goodwill,
core deposit and other intangibles.
Leverage – Tier I capital (pursuant to
risk-based capital guidelines) as a percentage of adjusted average
assets.
Tier I risk-based – Tier I 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 credit losses.
Tier I 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.
7. Book value per common share computed by
dividing total common shareholders' equity by common shares
outstanding. Tangible book value per common share computed by
dividing total common shareholders' equity, less goodwill, core
deposit and other intangibles by common shares outstanding.
8. Amounts are included in the statement
of operations in "Gains on mortgage loans sold, net", net of
commissions paid on such amounts.
9. At fair value, based on information
obtained from Pinnacle's third party broker/dealer for non-FDIC
insured financial products and services.
10. 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.
11. 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. Associate
retention rate does not include associates at acquired institutions
displaced by merger.
12. Adjusted pre-tax, pre-provision net
revenue excludes the impact of ORE expenses and income, investment
gains and losses on sales of securities and gain on sale of fixed
assets as a result of the sale-leaseback transaction.
13. Represents investment gains (losses)
on sales and impairments, net occurring as a result of gains or
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.
14. The dividend payout ratio is
calculated as the sum of the annualized dividend rate for dividends
paid on common shares divided by the trailing 12-months fully
diluted earnings per common share as of the dividend declaration
date.
15. Earnings from equity method investment
includes the impact of the issuance of subordinated debt as well as
the funding costs of the overall franchise. Income tax expense is
calculated using statutory tax rates.
16. Tax effect calculated using the
blended statutory rate of 25.00 percent for 2023. For periods prior
to 2023, tax effect calculated using the blended statutory rate of
26.14 percent.
17. Calculated using the same guidelines
as are used in the Federal Financial Institutions Examination
Council's Uniform Bank Performance Report.
pnfp-earnings
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230718517772/en/
MEDIA CONTACT: Joe Bass, 615-743-8219
FINANCIAL CONTACT: Harold Carpenter, 615-744-3742
WEBSITE: www.pnfp.com
Pinnacle Financial Partn... (NASDAQ:PNFP)
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