PINNACLE FINANCIAL PARTNERS INC - FORM 8-K - EX-99.1 - July 21, 2020

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8-K - 8-K - PINNACLE FINANCIAL PARTNERS INCpnfp-20200721.htm

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FOR IMMEDIATE RELEASE

MEDIA CONTACT:Joe Bass, 615-743-8219
FINANCIAL CONTACT:Harold Carpenter, 615-744-3742
WEBSITE: www.pnfp.com

PNFP REPORTS DILUTED EPS OF $0.83, ROAA OF 0.77% AND ROTCE OF 9.77% FOR 2Q 2020
Strong balance sheet with elevated capital and liquidity and sound asset quality metrics

NASHVILLE, TN, July 21, 2020 - Pinnacle Financial Partners, Inc. (Nasdaq/NGS: PNFP) reported net income per diluted common share of $0.83 for the quarter ended June 30, 2020, compared to net income per diluted common share of $1.31 for the quarter ended June 30, 2019, a decrease of 36.6 percent. Excluding gains and losses on the sale of investment securities and ORE expense for the three months ended June 30, 2020 and 2019, FHLB restructuring charges for the three months ended June 30, 2020, and branch rationalization charges and a loss from the sale of Pinnacle Bank's non-prime automobile portfolio for the three months ended June 30, 2019, net income per diluted common share was $0.89 in 2020, compared to $1.42 in 2019, a year-over-year decrease of 37.3 percent.
Net income per diluted common share was $1.20 for the six months ended June 30, 2020, compared to net income per diluted common share of $2.53 for the six months ended June 30, 2019, a decrease of 52.6 percent. Excluding gains and losses on the sale of investment securities and ORE expense for the six months ended June 30, 2020 and 2019, FHLB restructuring charges for the six months ended June 30, 2020 and branch rationalization charges and a loss from the sale of Pinnacle Bank's non-prime automobile portfolio for the six months ended June 30, 2019, net income per diluted common share was $1.28 in 2020, compared to $2.66 in 2019, a year-over-year decrease of 51.9 percent.
"Those that perform best through any economic cycle are the ones who are willing and able to quickly adapt to both temporary shifts and permanent change," said M. Terry Turner, Pinnacle's president and chief executive officer. "So for us, in the second quarter, we continued our intense focus on protecting our associates, clients, communities and shareholders from a rapidly progressing COVID-19 pandemic. In conjunction with the value we place on our long-term banking relationships, during the first and second quarters we granted payment deferrals on approximately $4.4 billion in loans and issued $2.2 billion in PPP loans to borrowers affected by the pandemic. We also fortified our balance sheet with additional liquidity and capital and began a diligent review of those borrowers we believe to be most impacted by the pandemic. As the second quarter evolved, we gathered an immense amount of borrower information through one-on-one discussions, organized surveys, industry data and other methods. This information, along with strong asset quality metrics, provides us a great deal of confidence about our portfolio's ability to better weather the impact of the pandemic and reconfirms the client selection processes we have deployed over these many years. As we enter the third quarter of 2020, our firm is looking forward to capitalizing on the opportunities that lie ahead for our franchise post-COVID-19."

BALANCE SHEET GROWTH:
•Loans at June 30, 2020 were $22.5 billion, an increase of $3.7 billion from June 30, 2019, reflecting year-over-year growth of 19.7 percent. Loans at June 30, 2020 increased $2.1 billion from March 31, 2020, reflecting a linked-quarter annualized growth rate of 41.6 percent. Contributing to the increased loan volumes at June 30, 2020 were $2.2 billion
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of loans issued through the Small Business Administration’s (SBA’s) Paycheck Protection Program (PPP) during the second quarter of 2020. The average yield on these loans, inclusive of $7.5 million of loan fee accretion recognized in the quarter, was 2.89 percent for the second quarter of 2020.
◦Average loans were $22.3 billion for the three months ended June 30, 2020, up $2.3 billion from $20.0 billion for the three months ended March 31, 2020, a linked-quarter annualized growth rate of 44.9 percent.
◦At June 30, 2020, the remaining discount associated with fair value accounting adjustments on acquired loans was $38.0 million, compared to $43.9 million at March 31, 2020.
◦At June 30, 2020, there were $68.7 million in SBA PPP loan fees remaining, which should be accreted into net interest income over the next two years as these loans are paid by borrowers or are forgiven under the PPP.
•Deposits at June 30, 2020 were a record $25.5 billion, an increase of $6.1 billion from June 30, 2019, reflecting year-over-year growth of 31.2 percent. Deposits at June 30, 2020 increased $4.2 billion from March 31, 2020, reflecting a linked-quarter annualized growth rate of 78.5 percent.
◦Average deposits were $24.8 billion for the three months ended June 30, 2020, compared to $20.7 billion for the three months ended March 31, 2020, a linked-quarter annualized growth rate of 79.8 percent.
◦Core deposits were $21.4 billion at June 30, 2020, compared to $16.5 billion at June 30, 2019 and $18.6 billion at March 31, 2020. The linked-quarter annualized growth rate of core deposits in the second quarter of 2020 was 59.9 percent.

"Traditionally, our firm has produced outsized growth predicated on our unique ability to attract great bankers to our firm," Turner said. "While we have pulled back on our recruiting to some extent, for the first six months of 2020, we’ve still attracted 56 revenue producers to our firm in 2020. And although we intend to hire fewer new associates than originally planned for 2020, we expect that the revenue producers we hire this year, combined with those hired over the last two years, should enable us to produce balance sheet growth beyond current levels of market demand.
"Obviously, the Paycheck Protection Program had a significant impact on our second quarter results. Although it is difficult to measure precisely the level of increased deposits that came to us from the PPP, our research indicates that our PPP borrowers increased their deposit balances with our firm by roughly $1.7 billion between March 31, 2020 and June 30, 2020, or approximately 61 percent of our linked-quarter core deposit growth of $2.8 billion."

PROFITABILITY:
•Return on average assets was 0.77 percent for the second quarter of 2020, compared to 0.40 percent for the first quarter of 2020 and 1.55 percent for the second quarter of 2019. Second quarter 2020 return on average tangible assets amounted to 0.81 percent, compared to 0.43 percent for the first quarter of 2020 and 1.67 percent for the second quarter of 2019.
◦Excluding the adjustments described above for both 2020 and 2019, return on average assets was 0.82 percent for the second quarter of 2020, compared to 0.42 percent for the first quarter of 2020 and 1.69 percent for the second quarter of 2019. Likewise, excluding those same adjustments, the firm’s return on average tangible assets was 0.87 percent for the second quarter of 2020, compared to 0.45 percent for the first quarter of 2020 and 1.82 percent for the second quarter of 2019.
•Return on average equity for the second quarter of 2020 amounted to 5.58 percent, compared to 2.58 percent for the first quarter of 2020 and 9.77 percent for the second quarter of 2019. Excluding preferred stockholders' equity for the
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three months ended June 30, 2020, return on average common equity for the second quarter of 2020 amounted to 5.66 percent, compared to 2.58 percent for the first quarter of 2020 and 9.77 percent for the second quarter of 2019. Second quarter 2020 return on average tangible common equity amounted to 9.77 percent, compared to 4.48 percent for the first quarter of 2020 and 17.74 percent for the second quarter of 2019.
◦Excluding the adjustments described above for both 2020 and 2019, return on average tangible common equity amounted to 10.45 percent for the second quarter of 2020, compared to 4.71 percent for the first quarter of 2020 and 19.28 percent for the second quarter of 2019.

"Profitability metrics were again significantly influenced by COVID-19," said Harold R. Carpenter, Pinnacle's chief financial officer. "As anticipated the reserve build of approximately $68 million was less than the first quarter. Nevertheless, the elevated provision was primarily due to higher than anticipated current unemployment metrics and qualitative overlays as a result of the uncertainty that exists in our markets. Additionally, exclusive of PPP loans, our loan portfolio decreased by $99.2 million when comparing June 30, 2020 to March 31, 2020, mostly due to loan draw requests, which were down by $380.4 million at June 30, 2020 when compared to March 31, 2020. We remain optimistic that our loan growth will achieve an annualized growth rate of low to mid-single digits in the second half of the year, but this will be subject to the ebbs and flows of the pandemic and the influence it has on business owners and the resulting leverage they are willing to accept in order to grow their businesses. Credit worthy opportunities, although down from prior years, are finding their way to the bank, and we are here to support those projects.
"Deposit inflows were strong and we ended the second quarter with exceptional core deposit growth even after considering the estimated impact of PPP. We continue to grow our core deposit base during these extraordinary times and attribute a large part of that growth to the focus of our relationship managers and the confidence our depositors place in them."

MAINTAINING A STRONG BALANCE SHEET:
•Net charge-offs were $5.4 million for the quarter ended June 30, 2020, compared to $10.2 million for the quarter ended March 31, 2020 and $4.1 million for the quarter ended June 30, 2019. Annualized net charge-offs as a percentage of average loans for the quarter ended June 30, 2020 were 0.10 percent, compared to 0.20 percent for the quarter ended March 31, 2020 and 0.09 percent for the second quarter of 2019.
•Nonperforming assets decreased to 0.38 percent of total loans and ORE at June 30, 2020, compared to 0.48 percent at March 31, 2020 and 0.55 percent at June 30, 2019. Nonperforming assets were $84.7 million at June 30, 2020, compared to $98.2 million at March 31, 2020 and $102.7 million at June 30, 2019.
•The classified asset ratio at June 30, 2020 was 11.2 percent, compared to 12.0 percent at March 31, 2020 and 13.9 percent at June 30, 2019. Classified assets were $338.4 million at June 30, 2020, compared to $350.1 million at March 31, 2020 and $337.8 million at June 30, 2019.
•The allowance for credit losses represented 1.27 percent of total loans at June 30, 2020, compared to 1.09 percent at March 31, 2020 and 0.48 percent at June 30, 2019. Excluding PPP loans, the allowance for credit losses as a percentage of loans was 1.41 percent at June 30, 2020.
◦The ratio of the allowance for credit losses to nonperforming loans increased to 456.1 percent at June 30, 2020, from 313.5 percent at March 31, 2020 and 118.6 percent at June 30, 2019. At June 30, 2020, purchased credit deteriorated loans of $8.9 million, which were recorded at fair value upon acquisition, represented 14.3 percent of the firm's nonperforming loans.
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◦Provision for credit losses was $68.3 million in the second quarter of 2020, compared to $99.9 million in the first quarter of 2020 and $7.2 million in the second quarter of 2019.
•During the second quarter of 2020, the firm successfully issued 9.0 million depositary shares, each representing a 1/40th fractional interest in a share of Series B noncumulative, perpetual preferred stock in a registered public offering to both retail and institutional investors. Net proceeds from the transaction after issuance costs were approximately $217.6 million. The net proceeds, which have been retained at Pinnacle Financial, contributed to an increase in Tier 1 capital at Pinnacle Financial and will provide additional capital for general corporate purposes.

"Net charge-offs decreased by $4.8 million when comparing the second quarter to the first quarter of 2020 due in part to a $1.7 million partial recovery of a first quarter charge-off," Carpenter said. "This meaningful recovery in the second quarter was related to a credit that we charged down and disclosed last quarter as the credit had been immediately impacted by the pandemic. We highlight this matter as it points to the speed at which we believe our firm is traveling and intends to travel in addressing problem credits. Our goal is to identify these credits and work them to an appropriate resolution as quickly as possible.
"Although substantially all of our credit metrics improved during the second quarter, we continue to expend great effort on several focus segments within our loan portfolio that we believe are the most negatively impacted by COVID-19, namely hospitality, restaurants, retail and entertainment. Our financial advisors are hands-on in identifying those borrowers that are experiencing difficulty and working with them to eliminate or minimize whatever loss content may be present in their portfolios. We’ve also experienced great progress with respect to borrower deferrals. During April 2020, borrower deferrals topped out at approximately $4.4 billion. At June 30, 2020, deferrals had decreased to $4.2 billion and, as of July 17, 2020, loans for which principal and/or interest was being deferred had decreased to $2.7 billion. New deferral requests have essentially ceased. Though it's still early in this process, and the disruption being experienced is like nothing we have ever seen, we are optimistic that many of our borrowers are gaining traction and will find a path forward through the pandemic.”

REVENUES:
•Revenues for the quarter ended June 30, 2020 were $273.6 million, an increase of $9.7 million from the $263.9 million recognized in the first quarter of 2020, an annualized growth rate of 14.7 percent. Revenues were up $14.0 million from the second quarter of 2019, a year-over-year growth rate of 5.4 percent.
◦Revenue per fully diluted common share was $3.63 for the three months ended June 30, 2020, compared to $3.47 for the first quarter of 2020 and $3.39 for the second quarter of 2019.
•Net interest income for the quarter ended June 30, 2020 was $200.7 million, compared to $193.6 million for the first quarter of 2020 and $188.9 million for the second quarter of 2019, a year-over-year growth rate of 6.2 percent. Net interest margin was 2.87 percent for the second quarter of 2020, compared to 3.28 percent for the first quarter of 2020 and 3.48 percent for the second quarter of 2019.
•Impacting the firm’s net interest income and net interest margin in the second quarter were the impact of both the PPP and the firm’s building of additional on-balance sheet liquidity as a result of the pandemic. PPP loans increased the firm’s average loans by $1.7 billion during the second quarter of 2020. Additionally, the firm also maintained approximately $2.0 billion in average excess liquidity, primarily in Federal funds sold and other cash equivalent balances. The firm's second quarter 2020 net interest margin was negatively impacted by approximately 0.32 percent as a result of PPP loans and building of excess liquidity throughout 2020.
•Included in net interest income for the second quarter of 2020 was $5.8 million of discount accretion associated with fair value adjustments, compared to $7.4 million of discount accretion recognized in the first quarter of 2020 and $8.9
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million in the second quarter of 2019. There remains $38.0 million of purchase accounting discount accretion as of June 30, 2020.
◦During the second quarter of 2020, the firm restructured approximately $392 million of FHLB advances resulting in $6.6 million of prepayment penalties, of which $2.9 million was recognized in the second quarter. The remaining prepayment penalties will be amortized over the next 5 years. The weighted average rate for the FHLB advances that were either paid off or restructured was 2.16 percent, while the new FHLB advances were acquired at an annualized rate of 0.60 percent.
•Noninterest income for the quarter ended June 30, 2020 was $73.0 million, compared to $70.4 million for the first quarter of 2020, a linked-quarter annualized growth rate of 14.8 percent. Compared to $70.7 million for the second quarter of 2019, noninterest income grew 3.2 percent year-over-year.
◦Wealth management revenues, which include investment, trust and insurance services, were $12.2 million for the quarter ended June 30, 2020, compared to $16.6 million for the first quarter of 2020 and $11.5 million for the second quarter of 2019, a year-over-year increase of 6.0 percent. Wealth management revenues have been aided by a growth in revenue producers over the last 12 to 18 months.
◦Income from the firm's investment in BHG was $17.2 million for the quarter ended June 30, 2020, up 10.4 percent compared to $15.6 million for the quarter ended March 31, 2020 and down 46.7 percent, compared to $32.3 million for the quarter ended June 30, 2019.
◦Net gains on mortgage loans sold were $19.6 million during the quarter ended June 30, 2020, up 128.6 percent compared to $8.6 million for the quarter ended March 31, 2020. Net gains on mortgage loans sold were up 226.4 percent, compared to $6.0 million during the quarter ended June 30, 2019. This dramatic growth reflects market conditions and the addition of a meaningful number of revenue producing mortgage originators over the last 12 to 18 months.
◦Other noninterest income was $17.2 million for the quarter ended June 30, 2020, compared to $20.1 million for the quarter ended March 31, 2020 and $16.5 million for the quarter ended June 30, 2019, year-over-year an increase of 4.4 percent. Contributing to the year-over-year growth were increases in SBA loan fees, loan swap fees and the value of the firm's bank-owned life insurance policies.

"After taking into account several of the tactics that were deployed in response to COVID-19, we are pleased with our net interest margin for the second quarter," Carpenter said. "These items will continue to impact our margin results over the next few quarters, but eventually their impact will lessen, allowing the GAAP margin to be more indicative of underlying business trends. Our focus for the third quarter will be to continue to reduce our deposit costs for both core and wholesale funding sources. Additionally, as the COVID-19 outlook improves, we also anticipate reducing our level of liquidity over the next two to three quarters and expect that eventually we will find our way to historical balance sheet liquidity levels. We’ve also been successful in the implementation of client loan floors on new and renewed loans. Our financial advisors are active with borrowers on this matter and during the second quarter, we negotiated new floors on $699 million in new and renewed short-term variable rate loans. Over and above that amount, we also negotiated floors on $1.1 billion in unfunded commitments also tied to short-term variable rates. These successful negotiations resulted in a loan floor penetration rate of 61 percent for funded loans and 85 percent for unfunded loans, which we consider to be exceptional. All of these matters should help support our core margin in future quarters.
"Our residential mortgage business continues to have a big year with a record of $551 million of secondary market placements in the second quarter. Our mortgage business remains robust and is helpful to us in countering our other businesses that have been more negatively impacted by the pandemic.
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"We believe BHG is also having another great year. For the first six months of 2020, BHG further strengthened its balance sheet by increasing its reserves, while at the same time reporting quarter-over-quarter net earnings growth. BHG has recently announced that in the third quarter it will seek to access the capital markets as it looks to place its first securitization over the next few weeks. This securitization will allow BHG to retain the interest income from the loans originated by it at a spread that they believe is greater than spreads it has achieved through its traditional business model. BHG anticipates that approximately $175 million in on-balance sheet BHG loans will collateralize the anticipated $160 million in securitization proceeds. BHG will not substitute new loans for loans in the collateral pool that experience payment defaults. We are also excited that the entire issuance has achieved an investment grade rating providing further confidence to investors."

OTHER HIGHLIGHTS:
•The firm's efficiency ratio for the second quarter of 2020 decreased to 48.1 percent, compared to 52.0 percent for the first quarter of 2020 and 49.2 percent in the second quarter of 2019. The ratio of noninterest expenses to average assets was 1.61 percent for the second quarter of 2020, compared to 1.96 percent in the first quarter of 2020 and 1.98 percent in the second quarter of 2019.
◦Excluding the adjustments described above for both 2020 and 2019, the efficiency ratio was 46.0 percent for the second quarter of 2020, compared to 51.2 percent for the first quarter of 2020 and 45.9 percent for the second quarter of 2019. Excluding ORE expense for 2020 and 2019, FHLB restructuring charges for 2020 and branch rationalization charges in 2019, the ratio of noninterest expense to average assets was 1.54 percent for the second quarter of 2020, compared to 1.92 percent for the first quarter of 2020 and 1.89 percent for the second quarter of 2019.
•Noninterest expense for the quarter ended June 30, 2020 was $131.6 million, compared to $137.3 million in the first quarter of 2020 and $127.7 million in the second quarter of 2019, reflecting a year-over-year increase of 3.1 percent. Excluding ORE expense for 2020 and 2019, FHLB restructuring charges for 2020 and branch rationalization charges for 2019, noninterest expense for the second quarter of 2020 increased 3.2 percent over the second quarter of 2019.
◦Salaries and employee benefits were $73.9 million in the second quarter of 2020, compared to $80.5 million in the first quarter of 2020 and $75.6 million in the second quarter of 2019, reflecting a year-over-year decrease of 2.3 percent.
▪Included in salaries and employee benefits are costs related to the firm’s annual cash incentive plan. Incentive costs for this plan amounted to approximately $573,000 in the second quarter of 2020, compared to $4.7 million in the first quarter of 2020 and $11.0 million in the second quarter of last year. The firm announced that as a result of the pandemic’s impact on the anticipated earnings for this year, the firm has reduced its accrual for payouts under its broad-based cash incentive plan for 2020 to a payout of approximately 25 percent. Additionally, the firm announced that performance-based equity compensation expense for previously granted awards with performance criteria tied to fiscal year 2020 tranches has also been significantly reduced, as many of these awards are likely to be forfeited as a result of the pandemic.
•The effective tax rate for the second quarter of 2020 was expense of 15.2 percent, compared to a benefit of 6.2 percent for the first quarter of 2020 and expense of 19.6 percent for the second quarter of 2019. The effective tax rate in the first quarter of 2020 was impacted by the tax benefit related to provision expense associated with the COVID-19 pandemic.
•During the first quarter of 2020, the firm acquired 1.0 million shares of its common stock in open market transactions pursuant to its previously announced share repurchase program, at an average price of $50.01. Since the announcement of the repurchase program, the number of shares acquired has been 2.5 million at an average price of $52.66. The firm's
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last transaction to repurchase shares of its common stock was on March 19, 2020. Shortly thereafter, the company suspended its share repurchase program.

"Expenses decreased in the second quarter of 2020 due to a meaningful reduction in incentive accruals as a result of COVID-19's impact on our earnings for this year," Carpenter said. "At June 30, 2020, we continue to accrue a 25 percent target level payout due to the newly implemented core deposit component for which our associates are outperforming with respect to both deposit volume and rate goals. We also added $4.5 million to off-balance sheet reserves in bringing the total off-balance sheet reserve to $20.8 million for this year.
"As we consider expense run rates going into the remainder of 2020, we have eliminated much of our 2020 hiring plan to consider only staffing of our Atlanta buildout, key revenue producer adds in our other markets as well as critical operational positions. We reaffirm our belief that our 2020 annualized expense growth will be in the low to mid-single digit percentage in comparison to 2019."

BOARD OF DIRECTORS DECLARES DIVIDENDS
On July 21, 2020, Pinnacle Financial's Board of Directors approved a quarterly cash dividend of $0.16 per common share to be paid on Aug. 28, 2020 to common shareholders of record as of the close of business on Aug. 7, 2020. Additionally, on that same day, Pinnacle Financial's Board of Directors approved a quarterly dividend of approximately $3.8 million, or $16.88 per share (or $0.422 per depositary share), on its 6.75 percent Series B Non-Cumulative Perpetual Preferred Stock payable on Sept. 1, 2020 to shareholders of record at the close of business on Aug. 17, 2020.
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.

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WEBCAST AND CONFERENCE CALL INFORMATION
Pinnacle will host a webcast and conference call at 8:30 a.m. CT on July 22, 2020, to discuss second quarter 2020 results and other matters. To access the call for audio only, please call 1-877-602-7944. For the presentation and streaming audio, please access the webcast on the investor relations page of Pinnacle's website at www.pnfp.com.
For those unable to participate in the webcast, it will be archived on the investor relations page of Pinnacle's website at www.pnfp.com for 90 days following the presentation.
Pinnacle Financial Partners provides a full range of banking, investment, trust, mortgage and insurance products and services designed for businesses and their owners and individuals interested in a comprehensive relationship with their financial institution. The firm is the No. 1 bank in the Nashville-Murfreesboro-Franklin MSA, according to 2019 deposit data from the FDIC. Pinnacle earned a spot on FORTUNE’s 2019 list of the 100 Best Companies to Work For® in the U.S., its third consecutive appearance. American Banker recognized Pinnacle as one of America’s Best Banks to Work For seven years in a row.
Pinnacle owns a 49 percent interest in Bankers Healthcare Group (BHG), which provides innovative, hassle-free financial solutions to healthcare practitioners and other licensed professionals. Great Place to Work and FORTUNE ranked BHG No. 1 on its 2020 list of Best Workplaces in New York 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 $33.3 billion in assets as of June 30, 2020. As the second-largest bank holding company headquartered in Tennessee, Pinnacle operates in 12 primarily urban markets in Tennessee, the Carolinas, Virginia and Georgia.
Additional information concerning Pinnacle, which is included in the Nasdaq Financial-100 Index, can be accessed at www.pnfp.com.
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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) further deterioration in the financial condition of borrowers of Pinnacle Bank and its subsidiaries or BHG resulting in significant increases in loan losses and provisions for those losses and, in the case of BHG, substitutions; (ii) the further effects of the emergence of widespread health emergencies or pandemics, including the magnitude and duration of the COVID-19 pandemic and its impact on general economic and financial market conditions and on Pinnacle Financial's and its customers' business, results of operations, asset quality and financial condition; (iii) the ability to grow and retain low-cost core deposits and retain large, uninsured deposits, including during times when Pinnacle Bank is seeking to lower rates it pays on deposits; (iv) the inability of Pinnacle Financial, or entities in which it has significant investments, like BHG, to maintain the historical growth rate of its, or such entities', loan portfolio; (v) changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments; (vi) effectiveness of Pinnacle Financial's asset management activities in improving, resolving or liquidating lower-quality assets; (vii) 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 compression to net interest margin; (viii) adverse conditions in the national or local economies including in Pinnacle Financial's markets throughout Tennessee, North Carolina, South Carolina, Georgia and Virginia,  particularly in commercial and residential real estate markets; (ix) 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; (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 including the recent expansion into the Atlanta, Georgia metro market; (xv) any matter that would cause Pinnacle Financial to conclude that there was impairment of any asset, including goodwill or other intangible assets; (xvi) 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; (xvii) deterioration in the valuation of other real estate owned and increased expenses associated therewith; (xviii) 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; (xix) approval of the declaration of any dividend by Pinnacle Financial's board of directors; (xx) 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; (xxi) 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;  (xxii) the risks associated with Pinnacle Financial and 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 if not prohibited from doing so by Pinnacle Financial or Pinnacle Bank; (xxiii) changes in state and federal legislation, regulations or policies applicable to banks and other financial service providers, like BHG, including regulatory or legislative developments; (xxiv) the availability of and access to capital; (xxv) 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, including as a result of Pinnacle Bank's participation in and execution of government programs related to the COVID-19 pandemic; and (xxvi) 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, 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.

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Non-GAAP Financial Matters
This release contains certain non-GAAP financial measures, including, without limitation, earnings per diluted common share, efficiency ratio 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, the charges associated with Pinnacle Financial's branch rationalization project, FHLB restructuring expenses, the sale of the remaining portion of Pinnacle Bank's non-prime automobile portfolio and other matters for the accounting periods presented. This release also includes non-GAAP financial measures which exclude the impact of loans originated 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 2020 versus certain periods in 2019 and to internally prepared projections.

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PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS – UNAUDITED
(dollars in thousands)
 June 30, 2020December 31, 2019June 30, 2019
ASSETS
Cash and noninterest-bearing due from banks$213,551  $157,901  $153,071  
Restricted cash254,593  137,045  121,440  
Interest-bearing due from banks2,221,519  210,784  332,862  
Federal funds sold and other3,798  20,977  20,214  
Cash and cash equivalents2,693,461  526,707  627,587  
Securities available-for-sale, at fair value3,310,278  3,539,995  3,256,906  
Securities held-to-maturity (fair value of $1.1 billion, net of allowance for credit losses of $188,000 at June 30, 2020, $201.2 million and $200.6 million at Dec. 31, 2019 and June 30, 2019, respectively)1,048,035  188,996  190,928  
Consumer loans held-for-sale69,443  81,820  70,004  
Commercial loans held-for-sale16,201  17,585  21,295  
Loans22,520,300  19,787,876  18,814,318  
Less allowance for credit losses(285,372) (94,777) (90,253) 
Loans, net22,234,928  19,693,099  18,724,065  
Premises and equipment, net281,739  273,932  274,729  
Equity method investment302,879  278,037  243,875  
Accrued interest receivable112,675  84,462  84,582  
Goodwill1,819,811  1,819,811  1,807,121  
Core deposits and other intangible assets47,131  51,130  41,578  
Other real estate owned22,080  29,487  26,657  
Other assets1,383,451  1,220,435  1,171,028  
Total assets$33,342,112  $27,805,496  $26,540,355  
LIABILITIES AND STOCKHOLDERS' EQUITY 
Deposits: 
Noninterest-bearing$6,892,864  $4,795,476  $4,493,419  
Interest-bearing4,815,012  3,630,168  3,129,941  
Savings and money market accounts9,338,719  7,813,939  7,547,166  
Time4,475,234  3,941,445  4,278,857  
Total deposits25,521,829  20,181,028  19,449,383  
Securities sold under agreements to repurchase194,553  126,354  154,169  
Federal Home Loan Bank advances1,787,551  2,062,534  1,960,062  
Subordinated debt and other borrowings717,043  749,080  464,144  
Accrued interest payable34,916  42,183  30,376  
Other liabilities390,573  288,569  305,860  
Total liabilities28,646,465  23,449,748  22,363,994  
Preferred stock, no par value, $10.0 million shares authorized; 225,000 shares non-cumulative perpetual preferred stock, Series B, liquidation preference $1,000 issued and outstanding at June 30, 2020 and no shares issued and outstanding at Dec. 31, 2019 and June 30, 2019, respectively
217,632  —  —  
Common stock, par value $1.00; 180.0 million shares authorized; 75.8 million, 76.6 million and 76.9 million shares issued and outstanding at June 30, 2020, Dec. 31, 2019 and June 30, 2019, respectively75,836  76,564  76,929  
Additional paid-in capital3,019,286  3,064,467  3,076,486  
Retained earnings1,218,367  1,184,183  1,002,434  
Accumulated other comprehensive income, net of taxes164,526  30,534  20,512  
Total stockholders' equity4,695,647  4,355,748  4,176,361  
Total liabilities and stockholders' equity$33,342,112  $27,805,496  $26,540,355  
This information is preliminary and based on company data available at the time of the presentation.

11


PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME – UNAUDITED
(dollars in thousands, except for per share data)Three months endedSix months ended
 June 30, 2020March 31, 2020June 30, 2019June 30, 2020June 30, 2019
Interest income:
Loans, including fees$226,281  $236,420  $237,653  $462,701  $467,032  
Securities
Taxable9,589  10,268  12,243  19,857  25,783  
Tax-exempt14,596  13,824  12,556  28,420  24,228  
Federal funds sold and other1,272  2,557  3,399  3,829  6,691  
Total interest income251,738  263,069  265,851  514,807  523,734  
Interest expense:
Deposits33,727  50,698  58,988  84,425  113,205  
Securities sold under agreements to repurchase94  115  142  209  287  
FHLB advances and other borrowings17,260  18,704  17,803  35,964  34,078  
Total interest expense51,081  69,517  76,933  120,598  147,570  
Net interest income200,657  193,552  188,918  394,209  376,164  
Provision for credit losses68,332  99,889  7,195  168,221  14,379  
Net interest income after provision for credit losses132,325  93,663  181,723  225,988  361,785  
Noninterest income:
Service charges on deposit accounts6,910  9,032  8,940  15,942  17,482  
Investment services5,971  9,239  5,868  15,210  11,207  
Insurance sales commissions2,231  3,240  2,147  5,471  5,075  
Gains on mortgage loans sold, net19,619  8,583  6,011  28,202  10,889  
Investment gains (losses) on sales, net(128) 463  (4,466) 335  (6,426) 
Trust fees3,958  4,170  3,461  8,128  6,756  
Income from equity method investment17,208  15,592  32,261  32,800  45,551  
Other noninterest income17,185  20,058  16,460  37,243  31,211  
Total noninterest income72,954  70,377  70,682  143,331  121,745  
Noninterest expense:
Salaries and employee benefits73,887  80,480  75,620  154,367  145,996  
Equipment and occupancy22,026  20,978  23,844  43,004  43,175  
Other real estate, net2,888  2,415  2,523  5,303  2,769  
Marketing and other business development2,142  3,251  3,282  5,393  6,230  
Postage and supplies2,070  1,990  2,079  4,060  3,971  
Amortization of intangibles2,479  2,520  2,271  4,999  4,582  
Other noninterest expense26,113  25,715  18,067  51,828  35,014  
Total noninterest expense131,605  137,349  127,686  268,954  241,737  
Income before income taxes73,674  26,691  124,719  100,365  241,793  
Income tax (benefit) expense11,230  (1,665) 24,398  9,565  47,512  
Net income$62,444  $28,356  $100,321  $90,800  $194,281  
Per share information:
Basic net income per common share$0.83  $0.37  $1.31  $1.20  $2.54  
Diluted net income per common share$0.83  $0.37  $1.31  $1.20  $2.53  
Weighted average common shares outstanding:
Basic75,210,869  75,803,402  76,343,608  75,507,136  76,572,120  
Diluted75,323,259  75,966,295  76,611,657  75,645,768  76,866,163  
This information is preliminary and based on company data available at the time of the presentation.
12


PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED
(dollars in thousands)JuneMarchDecemberSeptemberJuneMarch
202020202019201920192019
Balance sheet data, at quarter end:
Commercial and industrial loans$8,516,333  6,752,317  6,290,296  6,002,285  5,795,107  5,419,520  
Commercial real estate - owner occupied2,708,306  2,650,170  2,669,766  2,595,837  2,624,160  2,617,541  
Commercial real estate - investment4,822,537  4,520,234  4,418,658  4,443,687  4,252,098  4,107,953  
Commercial real estate - multifamily and other561,481  550,338  620,794  669,721  709,135  693,652  
Consumer real estate  - mortgage loans3,042,604  3,106,465  3,068,625  3,025,502  2,949,755  2,887,628  
Construction and land development loans2,574,494  2,520,937  2,430,483  2,253,303  2,117,969  2,097,570  
Consumer and other294,545  296,392  289,254  355,307  366,094  351,042  
Total loans22,520,300  20,396,853  19,787,876  19,345,642  18,814,318  18,174,906  
Allowance for credit losses(285,372) (222,465) (94,777) (93,647) (90,253) (87,194) 
Securities4,358,313  4,089,821  3,728,991  3,583,119  3,447,834  3,444,049  
Total assets33,342,112  29,264,180  27,805,496  27,547,834  26,540,355  25,557,858  
Noninterest-bearing deposits6,892,864  4,963,415  4,795,476  4,702,155  4,493,419  4,317,787  
Total deposits25,521,829  21,333,171  20,181,028  20,000,677  19,449,383  18,480,461  
Securities sold under agreements to repurchase194,553  186,548  126,354  95,402  154,169  100,698  
FHLB advances1,787,551  2,317,520  2,062,534  2,052,548  1,960,062  2,121,075  
Subordinated debt and other borrowings717,043  669,658  749,080  750,488  464,144  484,703  
Total stockholders' equity4,695,647  4,385,128  4,355,748  4,294,630  4,176,361  4,055,939  
Balance sheet data, quarterly averages:
Total loans$22,257,168  20,009,288  19,599,620  19,216,835  18,611,164  17,938,480  
Securities4,194,811  3,814,543  3,662,829  3,507,363  3,412,475  3,302,676  
Federal funds sold and other2,618,832  807,796  717,927  802,326  530,556  469,909  
Total earning assets29,070,811  24,631,627  23,980,376  23,526,524  22,554,195  21,711,065  
Total assets32,785,391  28,237,642  27,604,774  27,134,163  25,915,971  25,049,954  
Noninterest-bearing deposits6,432,010  4,759,729  4,834,694  4,574,821  4,399,766  4,195,443  
Total deposits24,807,032  20,679,455  20,078,594  19,778,007  18,864,859  18,358,094  
Securities sold under agreements to repurchase191,084  141,192  109,127  134,197  117,261  109,306  
FHLB advances2,213,769  2,029,888  1,992,213  2,136,928  2,164,341  1,926,358  
Subordinated debt and other borrowings706,657  673,415  753,244  533,194  469,498  470,775  
Total stockholders' equity4,499,438  4,417,155  4,343,246  4,265,006  4,117,754  4,017,375  
Statement of operations data, for the three months ended:
Interest income$251,738  263,069  268,453  275,749  265,851  257,883  
Interest expense51,081  69,517  74,281  79,943  76,933  70,637  
Net interest income200,657  193,552  194,172  195,806  188,918  187,246  
Provision for credit losses68,332  99,889  4,644  8,260  7,195  7,184  
Net interest income after provision for credit losses132,325  93,663  189,528  187,546  181,723  180,062  
Noninterest income72,954  70,377  59,462  82,619  70,682  51,063  
Noninterest expense131,605  137,349  130,470  132,941  127,686  114,051  
Income before taxes73,674  26,691  118,520  137,224  124,719  117,074  
Income tax (benefit) expense11,230  (1,665) 22,441  26,703  24,398  23,114  
Net income$62,444  28,356  96,079  110,521  100,321  93,960  
Profitability and other ratios:
Return on avg. assets (1)
0.77 %0.40 %1.38 %1.62 %1.55 %1.52 %
Return on avg. equity (1)
5.58 %2.58 %8.78 %10.28 %9.77 %9.49 %
 Return on avg. common equity (1)
5.66 %2.58 %8.78 %10.28 %9.77 %9.49 %
Return on avg. tangible common equity (1)
9.77 %4.48 %15.41 %18.28 %17.74 %17.60 %
Common stock dividend payout ratio (16)
16.41 %14.61 %12.24 %12.31 %12.88 %13.39 %
Net interest margin (2)
2.87 %3.28 %3.35 %3.43 %3.48 %3.62 %
Noninterest income to total revenue (3)
26.66 %26.67 %23.44 %29.67 %27.23 %21.43 %
Noninterest income to avg. assets (1)
0.89 %1.00 %0.85 %1.21 %1.09 %0.83 %
Noninterest exp. to avg. assets (1)
1.61 %1.96 %1.88 %1.94 %1.98 %1.85 %
Efficiency ratio (4)
48.10 %52.04 %51.44 %47.75 %49.19 %47.86 %
Avg. loans to avg. deposits
89.72 %96.76 %97.61 %97.16 %98.66 %97.71 %
Securities to total assets
13.07 %13.98 %13.41 %13.01 %12.99 %13.48 %
This information is preliminary and based on company data available at the time of the presentation.

13


PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
ANALYSIS OF INTEREST INCOME AND EXPENSE, RATES AND YIELDS-UNAUDITED
(dollars in thousands)Three months endedThree months ended
June 30, 2020June 30, 2019
 Average BalancesInterestRates/ YieldsAverage BalancesInterestRates/ Yields
Interest-earning assets
Loans (1) (2)
$22,257,168  $226,281  4.16 %$18,611,164  $237,653  5.22 %
Securities
Taxable2,157,081  9,589  1.79 %1,781,814  12,243  2.76 %
Tax-exempt (2)
2,037,730  14,596  3.44 %1,630,661  12,556  3.68 %
Federal funds sold and other2,618,832  1,272  0.20 %530,556  3,399  2.57 %
Total interest-earning assets29,070,811  $251,738  3.58 %22,554,195  $265,851  4.85 %
Nonearning assets
Intangible assets1,868,231  1,850,146  
Other nonearning assets1,846,349  1,511,630  
Total assets$32,785,391  $25,915,971  
Interest-bearing liabilities
Interest-bearing deposits:
Interest checking4,639,729  4,256  0.37 %3,150,865  9,305  1.18 %
Savings and money market9,181,266  8,904  0.39 %7,355,783  26,947  1.47 %
Time4,554,027  20,567  1.82 %3,958,445  22,736  2.30 %
Total interest-bearing deposits18,375,022  33,727  0.74 %14,465,093  58,988  1.64 %
Securities sold under agreements to repurchase191,084  94  0.20 %117,261  142  0.49 %
Federal Home Loan Bank advances2,213,769  9,502  1.73 %2,164,341  11,552  2.14 %
Subordinated debt and other borrowings706,657  7,758  4.42 %469,498  6,251  5.34 %
Total interest-bearing liabilities21,486,532  51,081  0.96 %17,216,193  76,933  1.79 %
Noninterest-bearing deposits6,432,010  —  —  4,399,766  —  —  
Total deposits and interest-bearing liabilities27,918,542  $51,081  0.74 %21,615,959  $76,933  1.43 %
Other liabilities367,411  182,258  
Stockholders' equity 4,499,438  4,117,754  
Total liabilities and stockholders' equity$32,785,391  $25,915,971  
Net  interest  income 
$200,657  $188,918  
Net interest spread (3)
2.62 %3.06 %
Net interest margin (4)
2.87 %3.48 %
(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 $6.9 million of taxable equivalent income for the three months ended June 30, 2020 compared to $6.9 million for the three months ended June 30, 2019. 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, 2020 would have been 2.84% compared to a net interest spread of 3.42% for the three months ended June 30, 2019.
(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.  

14


PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
ANALYSIS OF INTEREST INCOME AND EXPENSE, RATES AND YIELDS-UNAUDITED
(dollars in thousands)Six months endedSix months ended
June 30, 2020June 30, 2019
 Average BalancesInterestRates/ YieldsAverage BalancesInterestRates/ Yields
Interest-earning assets
Loans (1) (2)
$21,133,228  $462,701  4.48 %$18,276,680  $467,032  5.25 %
Securities
Taxable2,040,855  19,857  1.96 %1,813,693  25,783  2.87 %
Tax-exempt (2)
1,963,822  28,420  3.47 %1,544,186  24,228  3.77 %
Federal funds sold and other1,713,314  3,829  0.45 %500,400  6,691  2.70 %
Total interest-earning assets26,851,219  $514,807  3.96 %22,134,959  $523,734  4.89 %
Nonearning assets
Intangible assets1,869,147  1,851,292  
Other nonearning assets1,791,150  1,499,104  
Total assets$30,511,516  $25,485,355  
Interest-bearing liabilities
Interest-bearing deposits:
Interest checking4,192,505  12,723  0.61 %3,140,734  18,628  1.20 %
Savings and money market8,639,407  29,339  0.68 %7,446,911  53,284  1.44 %
Time4,315,462  42,363  1.97 %3,727,061  41,293  2.23 %
Total interest-bearing deposits17,147,374  84,425  0.99 %14,314,706  113,205  1.59 %
Securities sold under agreements to repurchase166,138  209  0.25 %113,305  287  0.51 %
Federal Home Loan Bank advances2,121,828  19,909  1.89 %2,046,007  21,515  2.12 %
Subordinated debt and other borrowings690,036  16,055  4.68 %470,133  12,563  5.39 %
Total interest-bearing liabilities20,125,376  120,598  1.21 %16,944,151  147,570  1.76 %
Noninterest-bearing deposits5,595,869  —  —  4,298,169  —  —  
Total deposits and interest-bearing liabilities25,721,245  $120,598  0.94 %21,242,320  $147,570  1.40 %
Other liabilities331,975  175,193  
Stockholders' equity 4,458,296  4,067,842  
Total liabilities and stockholders' equity$30,511,516  $25,485,355  
Net  interest  income 
$394,209  $376,164  
Net interest spread (3)
2.76 %3.14 %
Net interest margin (4)
3.06 %3.55 %
(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 $14.0 million of taxable equivalent income for the six-months ended June 30, 2020 compared to $13.4 million for the six months ended June 30, 2019. 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, 2020 would have been 3.02% compared to a net interest spread of 3.49% for the six months ended June 30, 2019.
(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.

15


PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED
(dollars in thousands)JuneMarchDecemberSeptemberJuneMarch
202020202019201920192019
Asset quality information and ratios:
Nonperforming assets:
Nonaccrual loans$62,562  70,970  61,605  73,263  76,077  96,144  
Other real estate (ORE) and
other nonperforming assets (NPAs)
22,105  27,182  29,487  30,049  26,658  15,138  
Total nonperforming assets$84,667  $98,152  $91,092  $103,312  $102,735  $111,282  
Past due loans over 90 days and still accruing interest$1,982  $1,990  $1,615  $2,450  $2,733  $1,982  
Accruing troubled debt restructurings (5)
$3,274  $3,869  $4,850  $5,803  $7,412  $5,481  
Accruing purchase credit impaired loans$14,616  $13,984  $13,249  $12,887  $12,632  $13,122  
Net loan charge-offs$5,385  $10,155  $3,515  $4,866  $4,136  $3,565  
Allowance for credit losses to nonaccrual loans456.1 %313.5 %153.8 %127.8 %118.6 %90.7 %
As a percentage of total loans:
Past due accruing loans over 30 days0.09 %0.17 %0.18 %0.24 %0.21 %0.22 %
Potential problem loans (6)
1.12 %1.22 %1.39 %1.31 %1.21 %1.05 %
Allowance for credit losses (20)
1.27 %1.09 %0.48 %0.48 %0.48 %0.48 %
Nonperforming assets to total loans, ORE and other NPAs0.38 %0.48 %0.46 %0.53 %0.55 %0.61 %
    Classified asset ratio (Pinnacle Bank) (8)
11.2 %12.0 %13.4 %13.5 %13.9 %13.0 %
Annualized net loan charge-offs to avg. loans (7)
0.10 %0.20 %0.07 %0.10 %0.09 %0.08 %
Wtd. avg. commercial loan internal risk ratings (6)
45.145.044.945.344.944.9
44.44.54.44.44.5
Interest rates and yields:
Loans4.16 %4.84 %5.00 %5.21 %5.22 %5.28 %
Securities2.59 %2.82 %2.85 %3.00 %3.20 %3.37 %
Total earning assets3.58 %4.41 %4.58 %4.78 %4.85 %4.94 %
Total deposits, including non-interest bearing0.55 %0.99 %1.10 %1.25 %1.25 %1.20 %
Securities sold under agreements to repurchase0.20 %0.33 %0.48 %0.45 %0.49 %0.54 %
FHLB advances1.73 %2.06 %2.10 %2.15 %2.14 %2.10 %
Subordinated debt and other borrowings4.42 %4.96 %4.04 %4.22 %5.34 %5.44 %
Total deposits and interest-bearing liabilities0.74 %1.19 %1.29 %1.40 %1.43 %1.37 %
Capital and other ratios (8):
Pinnacle Financial ratios:
Stockholders' equity to total assets14.1 %15.0 %15.7 %15.6 %15.7 %15.9 %
Common equity Tier one9.6 %9.4 %9.7 %9.6 %9.5 %9.4 %
Tier one risk-based10.4 %9.4 %9.7 %9.6 %9.5 %9.4 %
Total risk-based14.0 %12.8 %13.2 %13.2 %12.0 %12.0 %
Leverage8.4 %8.8 %9.1 %8.9 %9.1 %9.0 %
Tangible common equity to tangible assets8.3 %9.2 %9.6 %9.4 %9.4 %9.3 %
Pinnacle Bank ratios:
Common equity Tier one11.0 %11.0 %11.2 %11.1 %10.3 %10.4 %
Tier one risk-based11.0 %11.0 %11.2 %11.1 %10.3 %10.4 %
Total risk-based12.4 %12.2 %12.2 %12.1 %11.3 %11.4 %
Leverage8.9 %10.3 %10.5 %10.4 %9.8 %9.9 %
Construction and land development loans
as a percentage of total capital (19)
83.6 %84.2 %83.6 %79.9 %82.6 %84.1 %
Non-owner occupied commercial real estate and
multi-family as a percentage of total capital (19)
275.0 %264.1 %268.3 %272.8 %288.9 %282.5 %
This information is preliminary and based on company data available at the time of the presentation.

16


PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED
(dollars in thousands, except per share data)JuneMarchDecemberSeptemberJuneMarch
202020202019201920192019
Per share data:
Earnings  – basic$0.83  0.37  1.26  1.45  1.31  1.22  
Earnings - basic, excluding non-GAAP adjustments$0.89  0.39  1.27  1.45  1.43  1.24  
Earnings  – diluted$0.83  0.37  1.26  1.44  1.31  1.22  
Earnings - diluted, excluding non-GAAP adjustments$0.89  0.39  1.27  1.45  1.42  1.24  
Common dividends per share$0.16  0.16  0.16  0.16  0.16  0.16  
Book value per common share at quarter end (9)
$59.05  57.85  56.89  55.97  54.29  52.63  
Tangible book value per common share at quarter end (9)
$34.43  33.20  32.45  31.60  30.26  28.61  
Revenue per diluted common share$3.63  3.47  3.32  3.64  3.39  3.09  
Revenue per diluted common share, excluding non-GAAP adjustments$3.63  3.47  3.32  3.63  3.47  3.12  
Investor information:
Closing sales price of common stock on last trading day of quarter$41.99  37.54  64.00  56.75  57.48  54.70  
High closing sales price of common stock during quarter$48.98  64.03  64.80  61.14  59.23  59.55  
Low closing sales price of common stock during quarter$33.24  31.98  54.58  50.78  52.95  46.35  
Closing sales price of depositary shares on last trading day of quarter$25.98  —  —  —  —  —  
High closing sales price of depositary shares during quarter$26.05  —  —  —  —  —  
Low closing sales price of depositary shares during quarter$25.19  —  —  —  —  —  
Other information:
Residential mortgage loan sales:
Gross loans sold$550,704  286,703  322,228  302,473  291,813  193,830  
Gross fees (10)
$16,381  9,490  9,953  9,392  8,485  5,695  
Gross fees as a percentage of loans originated2.97 %3.31 %3.09 %3.11 %2.91 %2.94 %
Net gain on residential mortgage loans sold$19,619  8,583  6,044  7,402  6,011  4,878  
Investment gains (losses) on sales of securities, net (15)
$(128) 463  68  417  (4,466) (1,960) 
Brokerage account assets, at quarter end (11)
$4,499,856  4,000,643  4,636,441  4,355,429  4,287,985  4,122,980  
Trust account managed assets, at quarter end$2,908,131  2,714,582  2,942,811  2,530,356  2,425,791  2,263,095  
Core deposits (12)
$21,391,794  18,604,262  17,617,479  17,103,470  16,503,686  16,340,763  
Core deposits to total funding (12)
75.8 %75.9 %76.2 %74.7 %74.9 %77.1 %
Risk-weighted assets$24,937,535  24,600,490  23,911,064  23,370,342  22,706,512  22,001,959  
Number of offices 113  111  111  114  114  114  
Total core deposits per office$189,308  167,606  158,716  150,030  144,769  143,340  
Total assets per full-time equivalent employee$12,936  11,422  11,180  11,217  11,241  10,997  
Annualized revenues per full-time equivalent employee$426.9  414.3  404.6  449.8  441.0  415.9  
Annualized expenses per full-time equivalent employee$205.4  215.6  208.1  214.8  216.9  199.0  
Number of employees (full-time equivalent)2,577.5  2,562.0  2,487.0  2,456.0  2,361.0  2,324.0  
Associate retention rate (13)
94.5 %93.5 %92.8 %93.2 %93.0 %92.8 %
This information is preliminary and based on company data available at the time of the presentation.


17


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)
JuneMarchJuneJuneJune
20202020201920202019
Net interest income$200,657  193,552  188,918  394,209  376,164  
Noninterest income72,954  70,377  70,682  143,331  121,745  
Total revenues273,611  263,929  259,600  537,540  497,909  
Less: Investment (gains) losses on sales of securities, net128  (463) 4,466  (335) 6,426  
             Loss on sale of non-prime automobile portfolio—  —  1,536  —  1,536  
Total revenues excluding the impact of adjustments noted above$273,739  263,466  265,602  537,205  505,871  
Noninterest expense$131,605  137,349  127,686  268,954  241,737  
Less: Other real estate (ORE) expense2,888  2,415  2,523  5,303  2,769  
FHLB restructuring charges2,870  —  —  2,870  —  
Branch rationalization charges —  —  3,189  —  3,189  
Noninterest expense excluding the impact of adjustments noted above$125,847  134,934  121,974  260,781  235,779  
Pre-tax income$73,674  26,691  124,719  100,365  241,793  
Provision for credit losses68,332  99,889  7,195  168,221  14,379  
Pre-tax pre-provision income142,006  126,580  131,914  268,586  256,172  
Adjustments noted above5,886  1,952  11,714  7,838  13,920  
Adjusted pre-tax pre-provision income(14)
$147,892  128,532  143,628  276,424  270,092  
Noninterest income$72,954  70,377  70,682  143,331  121,745  
Less: Adjustments as noted above128  (463) 6,002  (335) 7,962  
Noninterest income excluding the impact of adjustments noted above$73,082  69,914  76,684  142,996  129,707  
Efficiency ratio (4)
48.10 %52.04 %49.19 %50.03 %48.55 %
Adjustments as noted above(2.13)%(0.83)%(3.27)%(1.49)%(1.94)%
Efficiency ratio (excluding adjustments noted above)45.97 %51.21 %45.92 %48.54 %46.61 %
Total average assets$32,785,391  28,237,642  25,915,971  30,511,516  25,485,355  
Noninterest income to average assets (1)
0.89 %1.00 %1.09 %0.94 %0.96 %
Adjustments as noted above0.01 %— %0.10 %— %0.07 %
Noninterest income (excluding adjustments noted above) to average assets (1)
0.90 %1.00 %1.19 %0.94 %1.03 %
Noninterest expense to average assets (1)
1.61 %1.96 %1.98 %1.77 %1.91 %
Adjustments as noted above(0.07)%(0.04)%(0.09)%(0.05)%(0.04)%
Noninterest expense (excluding adjustments noted above) to average assets (1)
1.54 %1.92 %1.89 %1.72 %1.87 %
This information is preliminary and based on company data available at the time of the presentation.

18


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)JuneMarchDecemberSeptemberJuneMarch
202020202019201920192019
Net income$62,444  28,356  96,079  110,521  100,321  93,960  
Investment (gains) losses on sales of securities, net128  (463) (68) (417) 4,466  1,960  
Sale of non-prime automobile portfolio—  —  —  —  1,536  —  
ORE expense2,888  2,415  804  655  2,523  246  
Branch rationalization charges—  —  —  —  3,189  —  
FHLB restructuring charges2,870  —  —  —  —  —  
Tax effect on adjustments noted above (18)
(1,539) (510) (192) (62) (3,062) (577) 
Net income excluding adjustments noted above $66,791  29,798  96,623  110,697  108,973  95,589  
Basic earnings per common share$0.83  0.37  1.26  1.45  1.31  1.22  
Adjustment due to investment (gains) losses on sales of securities, net—  —  —  (0.01) 0.06  0.03  
Adjustment due to sale of non-prime automobile portfolio—  —  —  —  0.02  —  
Adjustment due to ORE expense0.04  0.03  0.01  0.01  0.04  —  
Adjustment due to branch consolidation expense—  —  —  —  0.04  —  
Adjustment due to FHLB restructuring charges0.04  —  —  —  —  —  
Adjustment due to tax effect on adjustments noted above (18)
(0.02) (0.01) —  —  (0.04) (0.01) 
Basic earnings per common share excluding adjustments noted above$0.89  0.39  1.27  1.45  1.43  1.24  
Diluted earnings per common share$0.83  0.37  1.26  1.44  1.31  1.22  
Adjustment due to investment (gains) losses on sales of securities, net—  —  —  (0.01) 0.06  0.03  
Adjustment due to sale of non-prime automobile portfolio—  —  —  —  0.02  —  
Adjustment due to ORE expense0.04  0.03  0.01  0.01  0.03  —  
Adjustment due to branch consolidation expense—  —  —  —  0.04  —  
Adjustment due to FHLB restructuring charges0.04  —  —  —  —  —  
Adjustment due to tax effect on adjustments noted above (18)
(0.02) (0.01) —  0.01  (0.04) (0.01) 
Diluted earnings per common share excluding the adjustments noted above$0.89  0.39  1.27  1.45  1.42  1.24  
Revenue per diluted common share$3.63  3.47  3.32  3.64  3.39  3.09  
Adjustments as noted above—  —  —  (0.01) 0.08  0.03  
Revenue per diluted common share excluding adjustments noted above$3.63  3.47  3.32  3.63  3.47  3.12  
Equity method investment (17)
Fee income from BHG, net of amortization$17,208  15,592  12,312  32,248  32,261  13,290  
Funding cost to support investment2,134  2,122  2,345  2,366  2,399  2,379  
Pre-tax impact of BHG15,074  13,470  9,967  29,882  29,862  10,911  
Income tax expense at statutory rates3,940  3,521  2,605  7,811  7,806  2,852  
Earnings attributable to BHG$11,134  9,949  7,362  22,071  22,056  8,059  
Basic earnings per common share attributable to BHG$0.15  0.13  0.10  0.29  0.29  0.10  
Diluted earnings per common share attributable to BHG$0.15  0.13  0.10  0.29  0.29  0.10  
This information is preliminary and based on company data available at the time of the presentation.

19

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)JuneJune
20202019
Net income$90,800  194,281  
Investment (gains) losses on sales of securities, net(335) 6,426  
Sale of non-prime automobile portfolio—  1,536  
ORE expense5,303  2,769  
Branch consolidation expense—  3,189  
FHLB restructuring charges2,870  —  
Tax effect on adjustments noted above (18)
(2,049) (3,639) 
Net income excluding adjustments noted above $96,589  204,562  
Basic earnings per common share$1.20  2.54  
Adjustment due to investment (gains) losses on sales of securities, net—  0.08  
Adjustment due to sale of non-prime automobile portfolio—  0.02  
Adjustment due to ORE expense 0.07  0.04  
Adjustment due to branch consolidation expense—  0.04  
Adjustment due to FHLB restructuring charges0.04  —  
Adjustment due to tax effect on adjustments noted above (18)
(0.03) (0.05) 
Basic earnings per common share excluding adjustments noted above$1.28  2.67  
Diluted earnings per common share1.20  2.53  
Adjustment due to investment (gains) losses on sales of securities, net—  0.08  
Adjustment due to sale of non-prime automobile portfolio—  0.02  
Adjustment due to ORE expense 0.07  0.04  
Adjustment due to branch rationalization charges—  0.04  
Adjustment due to FHLB restructuring charges0.04  —  
Adjustment due to tax effect on adjustments noted above (18)
(0.03) (0.05) 
Diluted earnings per common share excluding the adjustments noted above$1.28  2.66  
Revenue per diluted common share$7.11  6.48  
Adjustments as noted above(0.01) 0.08  
Revenue per diluted common share excluding adjustments noted above$7.10  6.56  
Equity method investment (17)
Fee income from BHG, net of amortization$32,800  45,551  
Funding cost to support investment4,256  4,778  
Pre-tax impact of BHG28,544  40,773  
Income tax expense at statutory rates7,461  10,658  
Earnings attributable to BHG$21,083  30,115  
Basic earnings per common share attributable to BHG$0.28  0.39  
Diluted earnings per common share attributable to BHG$0.28  0.39  
This information is preliminary and based on company data available at the time of the presentation.

20

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)
JuneMarchJuneJuneJune
20202020201920202019
Return on average assets (1)
0.77 %0.40 %1.55 %0.60 %1.54 %
Adjustments as noted above0.05 %0.02 %0.14 %0.04 %0.08 %
Return on average assets excluding adjustments noted above (1)
0.82 %0.42 %1.69 %0.64 %1.62 %
Tangible assets:
Total assets$33,342,112  $29,264,180  $26,540,355  $33,342,112  $26,540,355  
Less:   Goodwill(1,819,811) (1,819,811) (1,807,121) (1,819,811) (1,807,121) 
Core deposit and other intangible assets(47,131) (48,610) (41,578) (47,131) (41,578) 
Net tangible assets$31,475,170  $27,395,759  $24,691,656  $31,475,170  $24,691,656  
Tangible equity:
Total stockholders' equity$4,695,647  $4,385,128  $4,176,361  $4,695,647  $4,176,361  
Less: Preferred stockholders' equity(217,632) —  —  (217,632) —  
Total common stockholders' equity4,478,015  4,385,128  4,176,361  4,478,015  4,176,361  
Less: Goodwill(1,819,811) (1,819,811) (1,807,121) (1,819,811) (1,807,121) 
Core deposit and other intangible assets(47,131) (48,610) (41,578) (47,131) (41,578) 
Net tangible common equity$2,611,073  $2,516,707  $2,327,662  $2,611,073  $2,327,662  
Ratio of tangible common equity to tangible assets8.30 %9.19 %9.43 %8.30 %9.43 %
Average tangible assets:
Average assets$32,785,391  $28,237,642  $25,915,971  $30,511,516  $25,485,355  
Less: Average goodwill(1,819,811) (1,819,811) (1,807,121) (1,819,811) (1,807,121) 
Average core deposit and other intangible assets(48,421) (50,252) (43,025) (49,337) (44,171) 
Net average tangible assets$30,917,159  $26,367,579  $24,065,825  $28,642,368  $23,634,063  
Return on average assets (1)
0.77 %0.40 %1.55 %0.60 %1.54 %
Adjustment due to goodwill, core deposit and other intangible assets0.04 %0.03 %0.12 %0.04 %0.12 %
Return on average tangible assets (1)
0.81 %0.43 %1.67 %0.64 %1.66 %
Adjustments as noted above0.06 %0.02 %0.15 %0.04 %0.09 %
Return on average tangible assets excluding adjustments noted above (1)
0.87 %0.45 %1.82 %0.68 %1.75 %
Average tangible common stockholders' equity:
Average stockholders' equity$4,499,438  $4,417,155  $4,117,754  $4,458,296  $4,067,842  
Less: Average preferred stockholders' equity(59,586) —  —  (29,793) —  
Average common stockholders' equity4,439,852  4,417,155  4,117,754  4,428,503  4,067,842  
Less:   Average goodwill(1,819,811) (1,819,811) (1,807,121) (1,819,811) (1,807,121) 
Average core deposit and other intangible assets(48,421) (50,252) (43,025) (49,337) (44,171) 
Net average tangible common equity$2,571,620  $2,547,092  $2,267,608  $2,559,355  $2,216,550  
Return on average equity (1)
5.58 %2.58 %9.77 %4.10 %9.63 %
Adjustment due to average preferred stockholders' equity0.08 %— %— %0.02 %— %
Return on average common equity (1)
5.66 %2.58 %9.77 %4.12 %9.63 %
Adjustment due to goodwill, core deposit and other intangible assets4.11 %1.90 %7.97 %3.01 %8.04 %
Return on average tangible common equity (1)
9.77 %4.48 %17.74 %7.13 %17.68 %
Adjustments as noted above0.68 %0.23 %1.54 %0.46 %0.93 %
Return on average tangible common equity excluding adjustments noted above (1)
10.45 %4.71 %19.28 %7.59 %18.61 %
Book value per common share at quarter end$59.05  $57.85  $54.29  $59.05  $54.29  
Adjustment due to goodwill, core deposit and other intangible assets(24.62) (24.65) (24.03) (24.62) (24.03) 
Tangible book value per common share at quarter end (9)
$34.43  $33.20  $30.26  $34.43  $30.26  
Allowance for credit losses on loans as a percent of total loans1.27 %1.09 %0.48 %1.27 %0.48 %
Impact of excluding PPP loans from total loans0.14 %— %— %0.14 %— %
Allowance as adjusted for the above exclusion of PPP loans from total loans1.41 %1.09 %0.48 %1.41 %0.48 %
This information is preliminary and based on company data available at the time of the presentation.

21


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. Troubled debt restructurings include loans where the company, as a result of the borrower's financial difficulties, has granted a credit concession to the borrower (i.e., interest only payments for a significant period of time, extending the maturity of the loan, etc.).  All of these loans continue to accrue interest at the contractual rate. Troubled debt restructurings do not include, beginning with the quarter ended March 31, 2020, loans for which the Company has granted a deferral of interest and/or principal or other modification pursuant to the guidance issued by the FDIC providing for relief under the Coronavirus Aid, Relief and Economic Security Act.
6. Average risk ratings are based on an internal loan review system which assigns a numeric value of 10 to 100 to all loans to commercial entities based on their underlying risk characteristics as of the end of each quarter. The risk rating scale was changed to allow for granularity, if needed, in criticized and classified risk ratings to distinguish accrual status or structural loan issues. A "10" risk rating is assigned to credits that exhibit Excellent risk characteristics, "20" exhibit Very Good risk characteristics, "30" Good, "40" Satisfactory, "50" Acceptable or Average, "60" Watch List, "70" Criticized, "80" Classified or Substandard, "90" Doubtful and "100" Loss (which are charged-off immediately).  Additionally, loans rated "80" or worse that are not nonperforming or restructured loans are considered potential problem loans.  Generally, consumer loans are not subjected to internal risk ratings.
7. Annualized net loan charge-offs to average loans ratios are computed by annualizing quarter-to-date net loan charge-offs and dividing the result by average loans for the quarter-to-date period.
8. 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 stockholders' equity as a percentage of end of period assets.
Tangible common equity to tangible assets - End of period total stockholders' 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.
9. Book value per common share computed by dividing total common stockholders' equity by common shares outstanding. Tangible book value per common share computed by dividing total common stockholders' equity, less goodwill, core deposit and other intangibles by common shares outstanding.
10. Amounts are included in the statement of operations in "Gains on mortgage loans sold, net", net of commissions paid on such amounts.
11. At fair value, based on information obtained from Pinnacle's third party broker/dealer for non-FDIC insured financial products and services.
12. Core deposits include all transaction deposit accounts, money market and savings accounts and all certificates of deposit issued in a denomination of less than $250,000. The ratio noted above represents total core deposits divided by total funding, which includes total deposits, FHLB advances, securities sold under agreements to repurchase, subordinated indebtedness and all other interest-bearing liabilities.
13. Associate retention rate is computed by dividing the number of associates employed at quarter end less the number of associates that have resigned in the last 12 months by the number of associates employed at quarter end. Associate retention rate does not include associates at acquired institutions displaced by merger.
14.  Adjusted pre-tax, pre-provision income excludes the impact of other real estate expenses and income and investment gains and losses on sales of securities.
15. 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.
16. 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.
17. 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.
18. Tax effect calculated using the blended statutory rate of 26.14 percent.
19. Calculated using the same guidelines as are used in the Federal Financial Institutions Examination Council's Uniform Bank Performance Report.
20. Effective January 1, 2020 Pinnacle Financial adopted the current expected credit loss accounting standard which requires the recognition of all losses expected to be recorded over a loan's life.

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PINNACLE FINANCIAL PARTNERS INC Reports