EX-99.1

MEDIA CONTACT:

Nikki Klemmer, 615-743-6132

FINANCIAL CONTACT:

Harold Carpenter, 615-744-3742

WEBSITE:

www.pnfp.com

EX-99.1 2 d522076dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

LOGO

FOR IMMEDIATE RELEASE

PINNACLE FINANCIAL ACHIEVES QUARTERLY RECORD FOR PRE-TAX NET INCOME

Fully diluted EPS up 86% over same quarter last year

NASHVILLE, Tenn., April 15, 2013 – Pinnacle Financial Partners, Inc. (Nasdaq/NGS: PNFP) today reported net income available to common stockholders of $13.4 million in the quarter ended March 31, 2013, up from net income available to common stockholders of $7.2 million for the same quarter in 2012. Net income per diluted common share was $0.39 for the quarter ended March 31, 2013, compared to net income per diluted common share of $0.21 for the quarter ended March 31, 2012, an increase of 85.7 percent.

“With our balance sheet rehabilitation largely behind us, growing the core earnings capacity of this firm is our No. 1 priority,” said M. Terry Turner, Pinnacle’s president and chief executive officer. “For many financial metrics, including pre-tax net income and return on average assets (ROAA), we are now operating at higher levels than ever before in the history of the firm. These results demonstrate significant core earnings growth and further validate our potential to reach our long-term profitability targets.”

Growing the Core Earnings Capacity of the Firm

•

Loans at March 31, 2013 were a record $3.772 billion, an increase of $60.2 million from Dec. 31, 2012, and $434.5 million from March 31, 2012, a year-over-year growth rate of 13.0 percent.

•

Average balances of noninterest bearing deposit accounts were $952.9 million in the first quarter of 2013, down 2.6 percent from the fourth quarter of 2012 and up 35.8 percent over the same quarter last year.

•

Revenues excluding securities gains for the quarter ended March 31, 2013 were a record $54.7 million, compared to $53.4 million last quarter and $49.5 million for the same quarter last year. Revenues excluding securities gains for the quarter ended March 31, 2013 were up 2.4 percent on a linked-quarter basis and 10.8 percent over the same quarter last year.

•

Net interest margin increased for the 10^th consecutive quarter to 3.90 percent for the quarter ended March 31, 2013, up from 3.80 percent last quarter and from 3.74 percent for the quarter ended March 31, 2012.

•

The firm’s efficiency ratio for the quarter ended March 31, 2013, was 59.4 percent compared to 63.0 percent last quarter and 72.4 percent for the same quarter last year. The firm’s efficiency ratio, excluding the $721.0 thousand in ORE expense and $876.5 thousand of charges related to the restructuring of $35.0 million of FHLB advances, was 56.4 percent for the first quarter of 2013.

•

Pre-tax pre-provision net income was $22.2 million for the quarter ended March 31, 2013, up 8.4 percent over the last quarter of 2012 and 63.0 percent over the same quarter last year.

“Our strategy to achieve our long-term profitability targets centers on our ability to produce continued meaningful loan and revenue growth with our existing infrastructure,” Turner said. “Despite another quarter of significant loan pay-downs, we were able to increase our net loans by $60.2 million during the first quarter. That’s a 13 percent year-over-year increase, slightly better than the cumulative annual growth rate required to achieve the three-year target we originally published in the fourth quarter of 2011.

“Excluding securities gains our first quarter 2013 top-line revenues represent a record for our firm. We expect to continue increasing our revenues while attempting to reduce the increases in our expenses. Therefore, we continue to believe a 1.10 to 1.30 percent ROAA target remains an appropriate profitability target for this firm.”

OTHER FIRST QUARTER 2013 HIGHLIGHTS:

•

Revenue growth

•

Net interest income for the quarter ended March 31, 2013, was $42.8 million, compared to $42.2 million in the fourth quarter of 2012 and $39.5 million for the first quarter of 2012. Net interest income for the first quarter of 2013 was up 8.4 percent year over year and at its highest quarterly level since the firm’s founding in 2000.

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•

Noninterest income for the quarter ended March 31, 2013, was $11.9 million, compared to $13.1 million for the fourth quarter of 2012 and $9.9 million for the same quarter last year. Excluding securities gains, noninterest income was up 7.03 percent on a linked-quarter basis, 21.0 percent over the same quarter last year and at its highest quarterly level since the firm’s founding.

•

Gains on mortgage loans sold, net of commissions, were $1.81 million during the first quarter of 2013, compared to $1.77 million during the fourth quarter of 2012 and $1.49 million during the first quarter of 2012.

•

Other noninterest income for the first quarter of 2013 increased by $709,000 over the fourth quarter of 2012 and by $1.19 million over the first quarter of last year. These increases were primarily attributable to increased interchange revenues and swap fees on commercial lending opportunities.

“We are extremely pleased with a 21 percent annual growth rate for noninterest income exclusive of securities gains,” said Harold R. Carpenter, Pinnacle’s chief financial officer. “Much like the industry as a whole, we have enjoyed the benefit of higher than normal revenues from mortgage origination due to elevated mortgage refinance levels. Nevertheless, the principal drivers of our growth in noninterest income have been deposit and wealth management fees, which we believe to be more sustainable over the long term than noninterest income attributable to the mortgage refinance market.

“We experienced a significant increase in our net interest margin this quarter due primarily to increases in average loan balances and continued reductions in funding costs. These positives were offset in part by a decrease in loan yields, which we expect will continue to be a challenge for all banks in coming quarters. Our current margin forecast for 2013 of 3.70 to 3.80 percent is consistent with the margin expectations that we outlined at the end of last quarter.”

•

Noninterest and income tax expense

•

Noninterest expense for the quarter ended March 31, 2013, was $32.4 million, compared to $34.9 million in the fourth quarter of 2012 and $35.8 million in the first quarter of 2012.

Page 3

•

Salaries and employee benefits costs were relatively flat from the fourth quarter of 2012 and decreased 1.11 percent from the same period last year.

•

Other real estate expenses were $721 thousand in the first quarter of 2013, compared to $1.36 million in the fourth quarter of 2012 and $4.68 million in the first quarter of 2012.

•

Income tax expense was $6.60 million for the first quarter of 2013, compared to $4.2 million in the first quarter of 2012 and $6.28 million in the fourth quarter of 2012, resulting in an effective tax rate for the first quarter of 2013 of 32.9 percent.

Carpenter also noted that the firm was diligently managing its expense infrastructure and that, exclusive of ORE expenses and FHLB restructuring charges, he anticipated expense increases for 2013 of 2 to 3 percent over 2012.

•

Asset Quality

•

Nonperforming assets declined by $2.76 million from Dec. 31, 2012, a linked-quarter reduction of 6.7 percent and the 11th consecutive quarterly reduction. Nonperforming assets were 1.02 percent of total loans and ORE at March 31, 2013, compared to 2.28 percent for the same quarter last year and 1.11 percent last quarter.

•

Classified assets as a percentage of Tier 1 capital plus allowance were 26.4 percent at March 31, 2013, compared to 29.4 percent last quarter and 39.3 percent for the same quarter last year.

•

Allowance for loan losses represented 1.84 percent of total loans at March 31, 2013, compared to 1.87 percent at Dec. 31, 2012, and 2.14 percent at March 31, 2012. The ratio of the allowance for loan losses to nonperforming loans increased to 317.9 percent at March 31, 2013, from 304.2 percent at Dec. 31, 2012, and 166.6 percent at March 31, 2012.

•

Net charge-offs were $2.18 million for the quarter ended March 31, 2013, compared to $3.63 million for the quarter ended March 31, 2012, and $2.16 million for the fourth quarter of 2012. Annualized net charge-offs for the quarter ended March 31, 2013, were 0.24 percent compared to 0.45 percent for the quarter ended March 31, 2012.

Page 4

•

Provision for loan losses increased from $1.03 million for the first quarter of 2012 to $2.17 million for the first quarter of 2013.

Pinnacle reported nonaccrual loan inflows of $8.4 million for the first quarter of 2013, compared to $5.9 million in the fourth quarter of 2012 and $14.3 million for the first quarter of 2012. Nonaccrual loan resolutions were $8.9 million in the first quarter of 2013, compared to $19.1 million in the fourth quarter of 2012 and $15.1 million in the first quarter of 2012.

“With respect to credit quality, we continued to see improvement in the first quarter on virtually all key measures,” Carpenter said. “Having largely completed the rehabilitation of our loan portfolio, our current belief is that we will continue to experience modest improvement in our credit metrics over the remainder of this year.”

WEBCAST AND CONFERENCE CALL INFORMATION

Pinnacle will host a webcast and conference call at 8:30 a.m. (CDT) on April 16, 2013, to discuss first quarter 2013 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, mortgage and insurance products and services designed for small- to mid-sized businesses and their owners and individuals interested in a comprehensive relationship with their financial institution. Comprehensive wealth management services, such as financial planning and trust, help clients increase, protect and distribute their assets.

The firm began operations in a single downtown Nashville location in Oct. 2000 and has since grown to almost $5.1 billion in assets at March 31, 2013. At March 31, 2013, Pinnacle is the second-largest bank holding company headquartered in Tennessee, with 29 offices in eight Middle Tennessee counties and three offices in Knoxville.

Additional information concerning Pinnacle can be accessed at www.pnfp.com.

###

Page 5

Certain of the statements in this release may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words “expect,” “anticipate,” “goal,” “objective,” “intend,” “plan,” “believe,” “should,” “seek,” “estimate” and similar expressions are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking. All forward-looking statements are subject to risks, uncertainties and other factors that may cause the actual results, performance or achievements of Pinnacle Financial to differ materially from any results expressed or implied by such forward-looking statements. Such risks include, without limitation, (i) deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses; (ii) continuation of the historically low short-term interest rate environment; (iii) the inability of Pinnacle Financial to grow its loan portfolio in the Nashville-Davidson-Murfreesboro-Franklin MSA and the Knoxville MSA; (iv) changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments; (v) effectiveness of Pinnacle Financial’s asset management activities in improving, resolving or liquidating lower-quality assets; (vi) increased competition with other financial institutions; (vii) greater than anticipated adverse conditions in the national or local economies including the Nashville-Davidson-Murfreesboro-Franklin MSA and the Knoxville MSA, particularly in commercial and residential real estate markets; (viii) rapid fluctuations or unanticipated changes in interest rates; (ix) the results of regulatory examinations; (x) the ability to retain large, uninsured deposits with the expiration of the FDIC’s transaction account guarantee program (xi) the development of any new market other than Nashville or Knoxville; (xii) a merger or acquisition; (xiii) any matter that would cause Pinnacle Financial to conclude that there was impairment of any asset, including intangible assets; (xiv) the ability to attract additional financial advisors or to attract customers from other financial institutions; (xv) further deterioration in the valuation of other real estate owned and increased expenses associated therewith; (xvi) inability to comply with regulatory capital requirements, including those resulting from currently proposed changes to capital calculation methodologies and required capital maintenance levels; and, (xvii) changes in state and federal legislation, regulations or policies applicable to banks and other financial service providers, including regulatory or legislative developments arising out of current unsettled conditions in the economy, including implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act. A more detailed description of these and other risks is contained in Pinnacle Financial’s most recent annual report on Form 10-K filed with the Securities and Exchange Commission on February 22, 2013. Many of such factors are beyond Pinnacle Financial’s ability to control or predict, and readers are cautioned not to put undue reliance on such forward-looking statements. Pinnacle Financial disclaims any obligation to update or revise any forward-looking statements contained in this release, whether as a result of new information, future events or otherwise.

Page 6

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS – UNAUDITED


	March 31, 2013			December 31, 2012
*ASSETS*
Cash and noninterest-bearing due from banks	$	57,906,350		$	51,946,542
Interest-bearing due from banks		38,860,678			111,535,083
Federal funds sold and other		2,792,238			1,807,044

Cash and cash equivalents		99,559,266			165,288,669

Securities available-for-sale, at fair value		683,545,006			706,577,806
Securities held-to-maturity (fair value of $40,376,745 and $583,212 at March 31, 2013 and December 31, 2012, respectively)		40,458,642			574,863
Mortgage loans held-for-sale		30,326,709			41,194,639

Loans		3,772,363,758			3,712,162,430
Less allowance for loan losses		(69,411,493	)		(69,417,437	)

Loans, net		3,702,952,265			3,642,744,993

Premises and equipment, net		75,760,671			75,804,895
Other investments		27,311,943			26,962,890
Accrued interest receivable		16,940,917			14,856,615
Goodwill		244,011,793			244,040,421
Core deposit and other intangible assets		4,582,286			5,103,273
Other real estate owned		16,802,183			18,580,097
Other assets		128,683,433			98,819,455

Total assets	$	5,070,935,114		$	5,040,548,616

*LIABILITIES AND STOCKHOLDERS’ EQUITY*
Deposits:
Noninterest-bearing	$	977,495,990		$	985,689,460
Interest-bearing		788,631,493			760,786,247
Savings and money market accounts		1,564,517,135			1,662,256,403
Time		572,250,233			606,455,873

Total deposits		3,902,894,851			4,015,187,983
Securities sold under agreements to repurchase		129,099,508			114,667,475
Federal Home Loan Bank advances		200,796,066			75,850,390
Subordinated debt and other borrowings		105,533,292			106,158,292
Accrued interest payable		1,235,441			1,360,598
Other liabilities		39,942,214			48,252,519

Total liabilities		4,379,501,372			4,361,477,257

Stockholders’ equity:
Preferred stock, no par value; 10,000,000 shares authorized; no shares issued and outstanding		—			—
Common stock, par value $1.00; 90,000,000 shares authorized; 35,022,487 shares and 34,696,597 shares issued and outstanding at March 31, 2013 and December 31, 2012, respectively		35,022,487			34,696,597
Additional paid-in capital		544,619,717			543,760,439
Retained earnings		100,834,814			87,386,689
Accumulated other comprehensive income, net of taxes		10,956,724			13,227,634

Stockholders’ equity		691,433,742			679,071,359

Total liabilities and stockholders’ equity	$	5,070,935,114		$	5,040,548,616

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


	Three Months Ended March 31,
	2013		2012
Interest income:
Loans, including fees	$	41,514,213	$	38,637,719
Securities
Taxable		3,670,934		4,929,284
Tax-exempt		1,656,408		1,703,146
Federal funds sold and other		314,772		553,939

Total interest income		47,156,327		45,824,088

Interest expense:
Deposits		3,412,396		4,827,476
Securities sold under agreements to repurchase		77,816		155,576
Federal Home Loan Bank advances and other borrowings		907,641		1,337,031

Total interest expense		4,397,853		6,320,083

Net interest income		42,758,474		39,504,005
Provision for loan losses		2,172,404		1,034,245

Net interest income after provision for loan losses		40,586,070		38,469,760

Noninterest income:
Service charges on deposit accounts		2,480,244		2,323,962
Investment services		1,792,640		1,646,778
Insurance sales commissions		1,393,304		1,287,560
Gain on mortgage loans sold, net		1,813,488		1,494,472
Gain on sale of investment securities, net		—		113,600
Trust fees		944,332		795,435
Other noninterest income		3,478,348		2,287,531

Total noninterest income		11,902,356		9,949,338

Noninterest expense:
Salaries and employee benefits		19,572,356		19,792,566
Equipment and occupancy		5,113,050		5,008,655
Other real estate expense		720,962		4,676,064
Marketing and other business development		790,671		785,325
Postage and supplies		591,488		563,294
Amortization of intangibles		520,987		686,067
Other noninterest expense		5,130,495		4,307,735

Total noninterest expense		32,440,009		35,819,706

Income before income taxes		20,048,417		12,599,392
Income tax expense		6,600,292		4,234,438

Net income		13,448,125		8,364,954
Preferred dividends		—		900,519
Accretion on preferred stock discount		—		258,647

Net income available to common stockholders	$	13,448,125	$	7,205,788

*Per share information:*
Basic net income per common share available to common stockholders	$	0.40	$	0.21

Diluted net income per common share available to common stockholders	$	0.39	$	0.21

Weighted average shares outstanding:
Basic		33,987,265		33,811,871
Diluted		34,206,202		34,423,898

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)*	March 2013			December 2012			September 2012			June 2012			March 2012			December 2011
Balance sheet data, at quarter end:
Commercial real estate - mortgage loans	$	1,278,639			1,178,196			1,167,136			1,167,068			1,123,690			1,110,962
Consumer real estate - mortgage loans		675,632			679,927			680,890			687,002			688,817			695,745
Construction and land development loans		306,433			313,552			312,788			289,061			281,624			274,248
Commercial and industrial loans		1,403,428			1,446,577			1,279,050			1,227,275			1,180,578			1,145,735
Consumer and other		108,232			93,910			85,300			74,277			63,160			64,661
Total loans		3,772,364			3,712,162			3,525,164			3,444,683			3,337,869			3,291,351
Allowance for loan losses		(69,411	)		(69,417	)		(69,092	)		(69,614	)		(71,379	)		(73,975	)
Securities		724,004			707,153			739,280			790,493			839,769			897,292
Total assets		5,070,935			5,040,549			4,871,386			4,931,878			4,789,583			4,863,951
Noninterest-bearing deposits		977,496			985,689			844,480			806,402			756,909			717,379
Total deposits		3,902,895			4,015,188			3,719,287			3,709,820			3,605,291			3,654,339
Securities sold under agreements to repurchase		129,100			114,667			134,787			127,623			118,089			131,591
FHLB advances		200,796			75,850			190,887			270,995			226,032			226,069
Subordinated debt and other borrowings		105,533			106,158			106,783			122,476			97,476			97,476
Total stockholders’ equity		691,434			679,071			672,824			659,287			718,665			710,145

Balance sheet data, quarterly averages:
Total loans	$	3,681,686			3,580,056			3,488,736			3,402,671			3,280,030			3,261,972
Securities		714,104			719,861			766,547			818,795			875,509			924,153
Total earning assets		4,513,273			4,493,216			4,379,742			4,365,715			4,316,973			4,347,352
Total assets		4,992,018			4,964,521			4,860,394			4,847,583			4,820,951			4,852,311
Noninterest-bearing deposits		952,853			978,366			799,508			755,594			701,760			705,580
Total deposits		3,949,742			3,883,423			3,705,672			3,636,240			3,597,271			3,641,845
Securities sold under agreements to repurchase		130,740			142,333			136,918			130,711			129,892			141,818
FHLB advances		98,989			124,781			214,271			232,606			238,578			209,619
Subordinated debt and other borrowings		106,777			108,489			112,406			101,872			97,476			97,476
Total stockholders’ equity		688,241			680,383			669,673			718,841			719,788			729,622

Statement of operations data, for the three months ended:
Interest income	$	47,156			47,203			46,441			45,953			45,824			46,446
Interest expense		4,398			4,960			5,509			5,768			6,320			7,153

Net interest income		42,758			42,243			40,932			40,185			39,504			39,293
Provision for loan losses		2,172			2,488			1,413			634			1,034			5,439

Net interest income after provision for loan losses		40,586			39,755			39,519			39,551			38,470			33,854
Noninterest income		11,902			13,108			10,430			9,910			9,949			9,727
Noninterest expense		32,440			34,851			33,578			33,916			35,820			34,374

Income before taxes		20,048			18,012			16,371			15,545			12,599			9,207
Income tax expense		6,600			6,282			5,022			5,106			4,234			1,447
Preferred dividends and accretion		—			—			—			2,655			1,159			2,079

Net income available to common stockholders	$	13,448			11,730			11,349			7,785			7,206			5,681

Profitability and other ratios:
Return on avg. assets (1)		1.09	%		0.94	%		0.93	%		0.65	%		0.60	%		0.46	%
Return on avg. equity (1)		7.92	%		6.86	%		6.74	%		4.36	%		4.03	%		3.09	%
Return on avg. tangible equity (1)		12.32	%		10.85	%		10.76	%		7.58	%		6.13	%		4.93	%
Net interest margin (1) (2)		3.90	%		3.80	%		3.78	%		3.76	%		3.74	%		3.65	%
Noninterest income to total revenue (3)		21.77	%		23.68	%		20.31	%		19.78	%		20.12	%		19.84	%
Noninterest income to avg. assets (1)		0.97	%		1.05	%		0.85	%		0.82	%		0.83	%		0.80	%
Noninterest exp. to avg. assets (1)		2.64	%		2.79	%		2.75	%		2.81	%		2.99	%		2.81	%
Noninterest expense (excluding ORE and FHLB prepayment charges) to avg. assets (1)		2.46	%		2.52	%		2.55	%		2.56	%		2.60	%		2.50	%
Efficiency ratio (4)		59.35	%		62.96	%		65.38	%		67.70	%		72.43	%		70.12	%
Avg. loans to average deposits		93.21	%		92.19	%		94.15	%		93.58	%		91.18	%		89.57	%
Securities to total assets		14.28	%		14.03	%		15.18	%		16.03	%		17.53	%		18.45	%

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*
(dollars in thousands)	*March 31, 2013*							*March 31, 2012*
	Average Balances		*Interest*		*Rates/Yields*			Average Balances		*Interest*		*Rates/Yields*
*Interest-earning assets*
Loans⁽¹⁾	$	3,681,686	$	41,514		4.58	%	$	3,280,030	$	38,638		4.74	%
Securities
Taxable		537,951		3,671		2.77	%		688,645		4,929		2.88	%
Tax-exempt⁽²⁾		176,153		1,656		5.09	%		186,864		1,703		4.90	%
Federal funds sold and other		117,483		315		1.25	%		161,434		554		1.50	%

Total interest-earning assets		4,513,273	$	47,156		4.30	%		4,316,973	$	45,824		4.33	%

*Nonearning assets*
Intangible assets		248,940							251,668
Other nonearning assets		229,805							252,310

Total assets	$	4,992,018						$	4,820,951

*Interest-bearing liabilities*
Interest-bearing deposits:
Interest checking	$	775,136	$	606		0.32	%	$	664,869	$	824		0.50	%
Savings and money market		1,632,715		1,624		0.40	%		1,541,559		2,142		0.56	%
Time		589,038		1,182		0.81	%		689,083		1,861		1.09	%

Total interest-bearing deposits		2,996,889		3,412		0.46	%		2,895,511		4,827		0.67	%
Securities sold under agreements to repurchase		130,740		78		0.24	%		129,892		156		0.48	%
Federal Home Loan Bank advances		98,989		191		0.78	%		238,578		610		1.03	%
Subordinated debt and other borrowings		106,777		717		2.72	%		97,476		727		3.00	%

Total interest-bearing liabilities		3,333,395		4,398		0.54	%		3,361,457		6,320		1.29	%
*Noninterest-bearing deposits*		952,853		—		—			701,760		—		—

Total deposits and interest-bearing liabilities		4,286,248	$	4,398		0.42	%		4,063,217	$	6,320		0.63	%

Other liabilities		17,529							37,946
*Stockholders’ equity*		688,241							719,788

Total liabilities and stockholders’ equity	$	4,992,018						$	4,820,951

*Net interest income*			$	42,758						$	39,504

Net interest spread ⁽³⁾						3.76	%						3.58	%
Net interest margin⁽⁴⁾						3.90	%						3.74	%

(1)

Average balances of nonperforming loans are included in the above amounts.

(2)

Yields computed on tax-exempt instruments on a tax equivalent basis.

(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 quarter ended March 31, 2013 would have been 3.88% compared to a net interest spread of 3.71% for the quarter ended March 31, 2012.

(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)*	March 2013			December 2012			September 2012			June 2012			March 2012			December 2011
Asset quality information and ratios:
Nonperforming assets:
Nonaccrual loans	$	21,837			22,823			36,571			40,821			42,852			47,855
Other real estate (ORE)		16,802			18,580			21,817			25,450			34,019			39,714

Total nonperforming assets	$	38,639			41,403			58,388			66,271			76,871			87,569

Past due loans over 90 days and still accruing interest	$	152			—			162			—			821			858
Troubled debt restructurings (5)	$	20,667			27,450			24,090			26,626			22,832			23,416
Net loan charge-offs	$	2,178			2,163			1,935			2,399			3,630			6,335
Allowance for loan losses to nonperforming loans		317.9	%		304.2	%		188.9	%		170.5	%		166.6	%		154.6	%
As a percentage of total loans:
Past due accruing loans over 30 days		0.23	%		0.29	%		0.35	%		0.21	%		0.34	%		0.36	%
Potential problem loans (6)		2.57	%		2.84	%		3.13	%		3.49	%		3.78	%		4.12	%
Allowance for loan losses		1.84	%		1.87	%		1.96	%		2.02	%		2.14	%		2.25	%
Nonperforming assets to total loans and ORE		1.02	%		1.11	%		1.65	%		1.91	%		2.28	%		2.66	%
Nonperforming assets to total assets		0.76	%		0.82	%		1.20	%		1.34	%		1.60	%		1.80	%
Annualized net loan charge-offs to year-to-date to avg. loans (7)		0.24	%		0.29	%		0.31	%		0.36	%		0.44	%		0.94	%
Avg. commercial loan internal risk ratings (6)		4.5			4.5			4.6			4.6			4.7			4.6

Interest rates and yields:
Loans		4.58	%		4.64	%		4.62	%		4.65	%		4.74	%		4.74	%
Securities		3.34	%		3.16	%		3.19	%		3.27	%		3.31	%		3.26	%
Total earning assets		4.30	%		4.24	%		4.28	%		4.29	%		4.33	%		4.30	%
Total deposits, including non-interest bearing		0.35	%		0.38	%		0.43	%		0.47	%		0.63	%		0.62	%
Securities sold under agreements to repurchase		0.24	%		0.24	%		0.29	%		0.36	%		0.48	%		0.50	%
FHLB advances		0.78	%		1.24	%		1.15	%		1.07	%		1.03	%		1.07	%
Subordinated debt and other borrowings		2.72	%		2.77	%		2.84	%		2.91	%		3.00	%		2.80	%
Total deposits and interest-bearing liabilities		0.42	%		0.46	%		0.53	%		0.57	%		0.63	%		0.69	%

Pinnacle Financial Partners capital ratios (8):
Stockholders’ equity to total assets		13.6	%		13.5	%		13.8	%		13.4	%		15.0	%		14.6	%
Leverage		10.8	%		10.6	%		10.5	%		10.3	%		11.7	%		11.4	%
Tier one risk-based		11.7	%		11.8	%		12.1	%		12.0	%		14.0	%		13.8	%
Total risk-based		13.0	%		13.0	%		13.4	%		13.5	%		15.4	%		15.3	%
Tier one common equity to risk-weighted assets		9.9	%		9.9	%		10.1	%		10.0	%		10.1	%		9.9	%
Tangible common equity to tangible assets		9.2	%		9.0	%		9.2	%		8.7	%		8.8	%		8.4	%
Pinnacle Bank ratios
Classified asset ratio		26.4	%		29.4	%		33.4	%		37.8	%		39.3	%		44.4	%
Leverage		10.7	%		10.5	%		10.5	%		10.4	%		10.6	%		10.3	%
Tier one risk-based		11.6	%		11.6	%		12.0	%		12.0	%		12.6	%		12.5	%
Total risk-based		12.8	%		12.9	%		13.3	%		13.3	%		14.1	%		14.0	%

This information is preliminary and based on company data available at the time of the presentation.

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES

SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED


*(dollars in thousands, except per share data)*	March 2013			December 2012			September 2012			June 2012			March 2012			December 2011
Per share data:
Earnings – basic	$	0.40			0.35			0.33			0.23			0.21			0.17
Earnings – diluted	$	0.39			0.34			0.33			0.23			0.21			0.17
Book value per common share at quarter end (9)	$	19.74			19.57			19.39			18.92			18.66			18.56
Tangible common equity per common share	$	12.64			12.39			12.19			11.79			11.50			11.33
Weighted avg. common shares – basic		33,987,265			33,960,664			33,939,248			33,885,779			33,811,871			33,485,253
Weighted avg. common shares – diluted		34,206,202			34,527,479			34,523,076			34,470,794			34,423,898			34,127,209
Common shares outstanding		35,022,487			34,696,597			34,691,659			34,675,913			34,616,013			34,354,960

Investor information:
Closing sales price	$	23.36			18.84			19.32			19.51			18.35			16.15
High closing sales price during quarter	$	23.73			20.60			20.38			19.51			18.44			16.65
Low closing sales price during quarter	$	19.29			18.05			18.88			16.64			15.25			10.28

Other information:
Gains on mortgage loans sold:
Mortgage loan sales:
Gross loans sold	$	120,569			132,485			130,277			105,486			119,426			134,842
Gross fees (10)	$	3,158			3,269			3,193			2,511			2,608			2,766
Gross fees as a percentage of mortgage loans originated		2.62	%		2.47	%		2.45	%		2.38	%		2.18	%		2.05	%
Gains (losses) on sales of investment securities, net of OTTI	$	—			1,988			(50	)		99			114			133
Brokerage account assets, at quarter-end (11)	$	1,333,676			1,242,379			1,244,100			1,191,259			1,176,180			1,061,249
Trust account managed assets, at quarter-end	$	515,970			496,264			465,983			462,487			461,719			447,193
Balance of commercial loan participations sold to other banks and serviced by Pinnacle, at quarter end	$	42,721			39,668			40,662			54,598			52,155			62,209
Core deposits (12)	$	3,767,433			3,875,745			3,576,425			3,523,542			3,414,501			3,441,547
Core deposits to total funding (12)		86.8	%		89.9	%		86.1	%		83.3	%		84.4	%		83.7	%
Risk-weighted assets	$	4,396,359			4,247,744			4,033,407			3,992,473			3,826,678			3,780,412
Total assets per full-time equivalent employee	$	7,038			6,900			6,715			6,724			6,442			6,511
Annualized revenues per full-time equivalent employee	$	307.7			301.4			281.6			273.9			266.8			263.2
Number of employees (full-time equivalent)		720.5			730.5			725.5			733.5			743.5			747.0
Associate retention rate (13)		91.2	%		93.2	%		93.4	%		94.0	%		93.7	%		92.0	%

Selected economic information (in thousands) (14):
Nashville MSA nonfarm employment - February 2013		797.5			810.7			793.8			782.3			777.9			779.9
Knoxville MSA nonfarm employment - February 2013		333.1			335.9			332.6			328.4			329.5			332.8
Nashville MSA unemployment - January 2013		6.3	%		6.3	%		6.6	%		6.9	%		6.6	%		7.1	%
Knoxville MSA unemployment - January 2013		6.6	%		6.2	%		6.4	%		6.7	%		6.2	%		6.5	%
Nashville residential median home price - March 2013	$	169.0			181.0			177.1			175.5			168.5			168.5
Nashville inventory of residential homes for sale - March 2013 (16)		9.9			9.1			11.0			11.8			11.8			10.6

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


*(dollars in thousands, except per share data)*	March 2013			December 2012			September 2012			June 2012			March 2012			December 2011
Tangible assets:
Total assets	$	5,070,935			5,040,549			4,871,386			4,931,878			4,789,583			4,863,951
Less: Goodwill		(244,012	)		(244,040	)		(244,045	)		(244,065	)		(244,072	)		(244,076	)
Core deposit and other intangible assets		(4,582	)		(5,103	)		(5,787	)		(6,470	)		(7,156	)		(7,842	)

Net tangible assets	$	4,822,342			4,791,406			4,621,554			4,681,343			4,538,355			4,612,033

Tangible equity:
Total stockholders’ equity	$	691,434			679,071			672,824			659,287			718,665			710,145
Less: Goodwill		(244,012	)		(244,040	)		(244,045	)		(244,065	)		(244,072	)		(244,076	)
Core deposit and other intangible assets		(4,582	)		(5,103	)		(5,787	)		(6,470	)		(7,156	)		(7,842	)

Net tangible equity		442,840			429,928			422,992			408,752			467,437			458,226
Less: Preferred stock		—			—			—			—			(69,355	)		(69,097	)

Net tangible common equity	$	442,840			429,928			422,992			408,752			398,082			389,130

Ratio of tangible common equity to tangible assets		9.18	%		8.97	%		9.15	%		8.73	%		8.77	%		8.44	%


	For the three months ended
	March 2013			December 2012			September 2012			June 2012			March 2012			December 2011
Net interest income	$	42,758			42,243			40,932			40,185			39,504			39,293

Noninterest income		11,902			13,108			10,430			9,910			9,949			9,727
Less: Net gains (losses) on sale of investment securities		—			1,988			(50	)		99			114			133

Noninterest income excluding the impact of net gains (losses) on sale of investment securities		11,902			11,120			10,480			9,811			9,835			9,594

Total revenues excluding the impact of net gains (losses) on sale of investment securities		54,660			53,363			51,413			49,996			49,339			48,886

Noninterest expense		32,440			34,851			33,578			33,915			35,820			34,374
Other real estate owned expense		721			1,365			2,399			3,104			4,676			4,193
FHLB restructuring charges		877			2,092			—			—			—			—

Noninterest expense excluding the impact of other real estate owned expense and FHLB restructuring charges		30,842			31,394			31,179			30,811			31,144			30,181

Adjusted pre-tax pre-provision income ⁽¹⁵⁾	$	23,818			21,969			20,233			19,185			18,195			18,706

Efficiency Ratio⁽⁴⁾		59.3	%		63.0	%		65.4	%		67.7	%		72.4	%		70.1	%

Efficiency Ratio excluding the gain or loss on sale of investment securities, the impact of other real estate owned expense and FHLB restructuring charges⁽⁴⁾		56.4	%		58.8	%		60.6	%		61.6	%		63.1	%		61.7	%

Noninterest expense	$	32,440			34,851			33,578			33,915			35,820			34,374
Other real estate owned expense		721			1,365			2,399			3,104			4,676			4,193
FHLB restructuring charges		877			2,092			—			—			—			—

Noninterest expense excluding the impact of other real estate owned expense and FHLB restructuring charges	$	30,842			31,394			31,179			30,811			31,144			30,181

Total average assets	$	4,992,018			4,964,521			4,860,394			4,847,583			4,820,951			4,852,311

Noninterest expense (excluding ORE expense and FHLB restructuring charges) to avg. assets ⁽¹⁾		2.46	%		2.52	%		2.55	%		2.56	%		2.60	%		2.50	%

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.

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.

Average risk ratings are based on an internal loan review system which assigns a numeric value of 1 to 10 to all loans to commercial entities based on their underlying risk characteristics as of the end of each quarter. A “1” risk rating is assigned to credits that exhibit Excellent risk characteristics, “2” exhibit Very Good risk characteristics, “3” Good, “4” Satisfactory, “5” Acceptable or Average, “6” Watch List, “7” Criticized, “8” Classified or Substandard, “9” Doubtful and “10” Loss (which are charged-off immediately). Additionally, loans rated “8” or worse that are not nonperforming or restructured loans are considered potential problem loans. Generally, consumer loans are not subjected to internal risk ratings.

7.	Annualized net loan charge-offs to average loans ratios are computed by annualizing year-to-date net loan charge-offs and dividing the result by average loans for the year-to-date period.

8.	Capital ratios are defined as follows:

Equity to total assets – End of period total stockholders’ equity as a percentage of end of period assets.

Tangible common equity to total assets - End of period total stockholders’ equity less end of period goodwill, core deposit and other intangibles as a percentage of end of period assets.

Leverage – Tier one capital (pursuant to risk-based capital guidelines) as a percentage of adjusted average assets.

Tier one risk-based – Tier one capital (pursuant to risk-based capital guidelines) as a percentage of total risk-weighted assets.

Total risk-based – Total capital (pursuant to risk-based capital guidelines) as a percentage of total risk-weighted assets.

Classified asset - Classified assets as a percentage of Tier 1 Capital plus allowance for loan losses.

9.	Book value per share computed by dividing total stockholders’ equity less preferred stock and common stock warrants by common shares outstanding.

10.	Amounts are included in the statement of operations in “Gains on loans sold, net”, net of commissions paid on such amounts.

11.	At fair value, based on information obtained from Pinnacle’s third party broker/dealer for non-FDIC insured financial products and services.

12.

Core deposits include all transaction deposit accounts, money market and savings accounts and all certificates of deposit issued in a denomination of less than $250,000. The ratio noted above represents total core deposits divided by total funding, which includes total deposits, FHLB advances, securities sold under agreements to repurchase, subordinated indebtedness and all other interest-bearing liabilities.

13.	Associate retention rate is computed by dividing the number of associates employed at quarter-end less the number of associates that have resigned in the last 12 months by the number of associates employed at quarter-end.

14.

Employment and unemployment data is from BERC- MTSU & Bureau of Labor Statistics. Labor force data is not seasonally adjusted. The most recent quarter data presented is as of the most recent month that data is available as of the release date. Historical data is subject to update by the BERC- MTSU & Bureau of Labor Statistics. Historical data is presented based on the most recently reported data available by the BERC- MTSU & Bureau of Labor Statistics. The Nashville home data is from the Greater Nashville Association of Realtors.

15.	Adjusted pre-tax, pre-provision income excludes the impact of net gains (losses) on investment security sales as well as other real estate owned expenses and FHLB prepayment charges.

16.	Represents homes currently listed with MLS in the Nashville MSA.