Federal Home Loan Bank Advances

12 Months Ended

Dec. 31, 2012

Federal Home Loan Bank Advances [Abstract]

Federal Home Loan Bank Advances

Note 9.  Federal Home Loan Bank Advances

Pinnacle Bank is a member of the Federal Home Loan Bank of Cincinnati (FHLB) and as a result, is eligible for advances from the FHLB, pursuant to the terms of various borrowing agreements, which assist Pinnacle Bank in the funding of its home mortgage and commercial real estate loan portfolios.  Pinnacle Bank has pledged certain qualifying residential mortgage loans and, pursuant to a blanket lien, certain qualifying commercial mortgage loans with an aggregate carrying value of approximately $683.3 million as collateral under the borrowing agreements with the FHLB.

At December 31, 2012 and 2011, Pinnacle Financial had received advances from the FHLB totaling $75,609,000 and $225,750,000, respectively.  Additionally, Pinnacle Financial recognized a discount on FHLB advances in conjunction with previous acquisitions.  The remaining discount was $241,000 and $319,000 at December 31, 2012 and 2011, respectively.  At December 31, 2012, the scheduled maturities of these advances and interest rates are as follows (in thousands):

	Scheduled Maturities		Weighted average interest rates
2013	$	25,000		0.21	%
2014		35,000		1.79	%
2015		-		0.00	%
2016		15,000		2.87	%
2017		-		0.00	%
Thereafter		609		2.48	%
	$	75,609
Weighted average interest rate				1.49	%

During 2012, Pinnacle Bank restructured approximately $60.0 million of FHLB advances to reduce our ongoing funding costs.  This restructuring was undertaken to reduce the weighted average interest rates on those FHLB advances of 1.91%.  The terms of the replacement advances are similar to those of the advances restructured, other than interest rate.  This restructuring resulted in a one-time charge of $2.1 million during the fourth quarter of 2012.

At December 31, 2012, Pinnacle Bank had accommodations which allow it to borrow from the Federal Reserve Bank of Atlanta's discount window and purchase Federal funds from several of its correspondent banks on an overnight basis at prevailing overnight market rates.  These accommodations are subject to various restrictions as to their term and availability, and in most cases, must be repaid within less than a month.  At December 31, 2012, there was no balance owed to the Federal Reserve Bank or other correspondents under these agreements. At December 31, 2012, Pinnacle Financial had approximately $1.5 billion in borrowing availability with the FHLB, the Federal Reserve Bank discount window, and other correspondent banks with whom Pinnacle Bank has arranged lines of credit.  At December 31, 2012, Pinnacle Bank was not carrying any balances under these arrangements.