EX-99.1 2 a4q22pnfpearningsrelease.htm EX-99.1 Document

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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 $1.76, ROAA OF 1.29% AND ROATCE OF 15.95% FOR 4Q2022
4Q22 annualized linked-quarter loans grew 19.2%, while deposits grew 15.1%

NASHVILLE, TN, Jan. 17, 2023 - Pinnacle Financial Partners, Inc. (Nasdaq/NGS: PNFP) reported net income per diluted common share of $1.76 for the quarter ended Dec. 31, 2022, compared to net income per diluted common share of $1.71 for the quarter ended Dec. 31, 2021, an increase of 2.9 percent. Net income per diluted common share was $7.17 for the year ended Dec. 31, 2022, compared to $6.75 for the year ended Dec. 31, 2021, an increase of 6.2 percent.
Paycheck Protection Program (PPP) net interest income for the three months ended Dec. 31, 2022 and 2021 was approximately $72,000 and $15.1 million, respectively. PPP net interest income for the years ended Dec. 31, 2022 and 2021 was $15.6 million and $81.4 million, respectively. PPP net interest income had minimal impact on diluted earnings per common share for the three months ended Dec. 31, 2022 and a $0.15 impact to diluted earnings per common share for the year ended Dec. 31, 2022, compared to impacts of $0.15 and $0.79 for the three months and year ended Dec. 31, 2021, respectively.
"Overall, I am very pleased with our operating performance in 2022," said M. Terry Turner, Pinnacle's president and chief executive officer. "Our core banking business continues to produce outsized growth as we capitalize on vulnerabilities at the larger banks. With a macro environment dominated by rapidly rising short-term interest rates and a very volatile yield curve, maintaining a fortress balance sheet became even more important. Throughout 2022, in addition to protecting tangible book value per common share our credit metrics remained strong and, though there are many economic uncertainties, we remain cautiously optimistic going into 2023. Additionally, even though the competitive pressures to maintain and grow deposits intensified, we were able to grow deposits by 11.7 percent during 2022, which, along with the excess liquidity we had on our balance sheet going into the year, allowed us to fund 24.0 percent loan growth for the year. Perhaps most importantly, we continue to win the war for talent having hired a record 147 revenue producers to our firm in 2022, compared to 119 in 2021. All in all, 2022 was a successful year.
"We believe the operating environment for banks in 2023 will also be challenging. The outlook for the macro environment in 2023 is uncertain at best. Nevertheless, we operate in some of the best banking markets in the country with an organic growth model that we believe further differentiates itself in times such as these. As we enter 2023, we will direct our efforts toward both strong profitability and earnings growth. Our senior leadership and associates are all in and stand ready to meet the challenges ahead."

BALANCE SHEET GROWTH:

Total assets at Dec. 31, 2022 were $42.0 billion, an increase of approximately $3.5 billion from Dec. 31, 2021, reflecting a year-over-year increase of 9.1 percent. A further analysis of select balance sheet trends follows:
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Balances at Linked-Quarter
Annualized
% Change		Balances atYear-over-Year
% Change
(dollars in thousands)Dec. 31, 2022Sept. 30, 2022Dec. 31, 2021
Loans$29,041,605 $27,711,694 19.2%$23,414,262 24.0%
Less: PPP loans7,96710,723(102.8)%371,118(97.9)%
Loans excluding PPP loans29,033,63827,700,97119.2%23,043,14426.0%
Securities and other interest-earning assets8,123,2598,706,453(26.8)%11,046,895(26.5)%
Total interest-earning assets excluding PPP loans$37,156,897 $36,407,424 8.2%$34,090,039 9.0%
Core deposits:
Noninterest-bearing deposits9,812,74410,567,873(28.6)%10,461,071(6.2)%
Interest-bearing core deposits(1)
21,488,33320,180,94425.9%18,855,840 14.0%
Noncore deposits and other funding(2)
4,743,5624,444,86826.9%3,452,034 37.4%
Total funding $36,044,639 $35,193,685 9.7%$32,768,945 10.0%
(1): Interest-bearing core deposits are interest-bearing deposits, money market accounts, time deposits less than $250,000 and reciprocating time and money market deposits issued through the IntraFi Network.
(2): Noncore deposits and other funding consists of time deposits greater than $250,000, securities sold under agreements to repurchase, public funds, brokered deposits, FHLB advances and subordinated debt.

"I am pleased to report that end-of-period loans grew $1.3 billion during the fourth quarter," Turner said. "Importantly, our deposit base also increased by $1.3 billion during the fourth quarter. We experienced a $755 million reduction in noninterest-bearing account balances during the fourth quarter of 2022 as depositors accelerated their desire for higher yields. Our relationship managers are tightly focused on both deposit acquisition and retention, and are armed with a number of specialized deposit products, including what we believe is a "best-in-class" treasury suite, that should allow us to meet our targets for both volumes and mix in 2023."

PRE-TAX, PRE-PROVISION NET REVENUE (PPNR) GROWTH:

Pre-tax, pre-provision net revenues (PPNR) for the quarter ended Dec. 31, 2022 were $199.7 million, an increase of 18.1 percent from the $169.1 million recognized in the quarter ended Dec. 31, 2021.
Three months ended Year ended
Dec. 31Dec. 31
(dollars in thousands)20222021 % change20222021% change
Revenues:
Net interest income$319,460 $238,763 33.8 %$1,129,293 $932,401 21.1 %
Noninterest income82,321 100,723 (18.3)%416,124 395,734 5.2 %
Total revenues401,781 339,486 18.3 %1,545,417 1,328,135 16.4 %
Noninterest expense202,047 170,417 18.6 %779,999 660,104 18.2 %
Pre-tax, pre-provision net revenue (PPNR)199,734 169,069 18.1 %765,418 668,031 14.6 %
Adjustments:
Investment (gains) losses on sales of securities, net— (393)NM(156)(759)NM
ORE expense (benefit)179 37 NM280 (712)NM
Adjusted PPNR$199,913 $168,713 18.5 %$765,542 $666,560 14.8 %

•Revenue per fully diluted common share was $5.27 for the three months ended Dec. 31, 2022, compared to $5.40 for the third quarter of 2022 and $4.47 for the fourth quarter of 2021, a 17.9 percent year-over-year growth rate.
•Net interest income for the quarter ended Dec. 31, 2022 was $319.5 million, compared to $305.8 million for the third quarter of 2022 and $238.8 million for the fourth quarter of 2021, a year-over-year growth rate of 33.8 percent.
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◦Revenues from PPP loans approximated $72,000 in the fourth quarter of 2022, compared to $755,000 in the third quarter of 2022 and $15.1 million in the fourth quarter of 2021. At Dec. 31, 2022, remaining unamortized fees for PPP loans were approximately $250,000.
◦Included in net interest income for the fourth quarter of 2022 was $1.2 million of discount accretion associated with fair value adjustments, compared to $1.3 million of discount accretion recognized in the third quarter of 2022 and $2.2 million in the fourth quarter of 2021. There remains $3.3 million of purchase accounting discount accretion as of Dec. 31, 2022.
•Noninterest income for the quarter ended Dec. 31, 2022 was $82.3 million, compared to $104.8 million for the third quarter of 2022 and $100.7 million for the fourth quarter of 2021, a year-over-year decline of 18.3 percent.
◦Wealth management revenues, which include investment, trust and insurance services, were $20.2 million for the fourth quarter of 2022, compared to $19.4 million for the third quarter of 2022 and $19.3 million reported for the fourth quarter of 2021, a year-over-year increase of 4.5 percent.
◦Service charges on deposit accounts were $11.1 million for the quarter ended Dec. 31, 2022, compared to $10.9 million for the quarter ended Sept. 30, 2022 and $12.7 million for the quarter ended Dec. 31, 2021. Service charge revenues were negatively impacted by changes to the firm's insufficient funds and overdraft programs implemented during the third quarter of 2022.
◦During the fourth quarter of 2022, mortgage loans sold resulted in a net $65,000 loss primarily due to reduction in the volume of mortgage loan pipelines and the resulting reduction in the pipeline's market valuation of approximately $966,000.
◦Income from the firm's investment in BHG was $21.0 million for the quarter ended Dec. 31, 2022, down from $41.3 million for the quarter ended Sept. 30, 2022 and $30.8 million for the quarter ended Dec. 31, 2021, a year-over-year decline of 31.9 percent for the quarter. Income from the firm's investment in BHG was $145.5 million for the year ended Dec. 31, 2022, a 19.0 percent increase over 2021.
▪During the fourth quarter of 2022, BHG accelerated its strategy of retaining more loans on its balance sheet, which was aided by expanding its liquidity platform through the establishment of three new borrowing facilities. These facilities, which are secured by loans on BHG's balance sheet, represent incremental funding sources to BHG. At Dec. 31, 2022, BHG had fully drawn on one of these funding sources, a $500 million facility from a U.S. asset manager which carried an annualized interest rate of 7.95 percent. As a result of drawing on this facility, BHG elected to place fewer loans though its auction platform in the fourth quarter than was previously planned at the beginning of the quarter. This compares to $446 million in fundings through its securitization platform in the third quarter of 2022.
▪Loans sold to BHG's community bank partners were approximately $600 million in the fourth quarter of 2022 compared to approximately $555 million in the third quarter of 2022 and $375 million in the fourth quarter of 2021. Loan originations decreased to $1.07 billion in the fourth quarter of 2022 compared to $1.17 billion in the third quarter of 2022, its all-time quarterly high for originations. Originations decreased in the fourth quarter primarily due to BHG electing to tighten its underwriting and thus increase the quality of its originations.
▪BHG increased its reserves for on-balance sheet loan losses to $146.9 million, or 4.59 percent of loans held for investment at Dec. 31, 2022, compared to 3.53 percent at Sept. 30, 2022. BHG also increased its accrual for losses attributable to loan substitutions and prepayments for loans
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previously sold through its community bank auction platform to $313.9 million, or 5.66 percent of the loans that have been previously sold and were unpaid, at Dec. 31, 2022 compared to 5.28 percent at Sept. 30, 2022.
◦Other noninterest income was $30.1 million for the quarter ended Dec. 31, 2022, compared to $31.8 million for the quarter ended Sept. 30, 2022 and $33.2 million for the quarter ended Dec. 31, 2021, a year-over-year decline of 9.6 percent.
▪Fourth quarter 2022 gains from market valuation adjustments in other equity investments were $1.5 million, compared to $725,000 in the third quarter of 2022 and $4.1 million in the fourth quarter of 2021.
•Noninterest expense for the quarter ended Dec. 31, 2022 was $202.0 million, compared to $199.3 million in the third quarter of 2022 and $170.4 million in the fourth quarter of 2021, reflecting a year-over-year increase of 18.6 percent.
◦Salaries and employee benefits were $131.8 million in the fourth quarter of 2022, compared to $129.9 million in the third quarter of 2022 and $110.0 million in the fourth quarter of 2021, reflecting a year-over-year increase of 19.8 percent.
▪Increase in headcount contributed to the growth in compensation. Total full-time equivalent associates amounted to 3,241.5 associates at Dec. 31, 2022, compared to 2,841.0 full-time equivalent associates at Dec. 31, 2021, a year-over-year increase in headcount of 14.1 percent.
▪Costs related to the firm's incentive plans were $28.5 million in the fourth quarter of 2022 compared to $30.7 million in the third quarter of 2022 and $24.2 million in the fourth quarter of 2021. The reduction in incentive costs in the fourth quarter of 2022 from the third quarter was caused by the fact that the firm did not achieve its fourth quarter PPNR targets under its annual cash incentive plan. Thus, the costs associated with the annual cash incentive award was reduced in the fourth quarter. This reduction was offset by increased headcount. Additionally, a significant portion of the firm's leadership team members' equity compensation is performance-based. After evaluation of the impact of the company's performance in the fourth quarter of 2022 on the company's full year performance against the performance metrics applicable to these performance-based equity awards, it was determined that a smaller accrual was required in the fourth quarter than the company had recorded in each of the first three quarters of 2022.
◦Noninterest expense categories, other than salaries and employee benefits, were $70.2 million in the fourth quarter of 2022, compared to $69.3 million in the third quarter of 2022 and $60.4 million in the fourth quarter of 2021, reflecting a year-over-year increase of 16.4 percent.

"Our fourth quarter 2022 PPNR results decreased by 5.5 percent from the third quarter, while full year 2022 PPNR results exceeded 2021 results by 14.6 percent," said Harold R. Carpenter, Pinnacle’s chief financial officer. "Loan growth, as well as the impact of the rising short-term rate environment, contributed to an increase of $13.7 million in net interest income in the fourth quarter of 2022 as compared to the third quarter of 2022. As to BHG, we anticipated a reduction in its fourth quarter results. Further impacting its fourth quarter results was the successful closing of three new funding sources, showcasing BHG's unique access to liquidity at a time when many asset generators are struggling to fund their growth. BHG's decision to tap into one of these funding sources contributed to fewer loans being placed on the auction platform than was originally anticipated resulting in reduced fourth quarter BHG revenues. However, by electing to hold more loans on BHG's balance sheet, this should support increased net interest income to BHG in the future.
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"Total revenues increased by approximately $217.3 million between 2022 and 2021, again primarily due to loan growth and the impact of the rising short-term rate environment; however, this increase was negatively impacted by approximately $65.9 million in reduced PPP revenues in 2022 compared to 2021 and rising deposit costs. Thus, excluding PPP revenues of $15.6 million and $81.4 million, from 2022 and 2021, respectively, total revenues were up approximately 22.7 percent between the two periods. Total expenses increased by $119.9 million between 2022 and 2021, primarily due to the increased personnel costs associated with the net addition of approximately 400 associates during 2022.
"Obviously, increased wages and inflation will have a bearing on our expense run rates as we enter 2023. We have built another strong hiring plan for 2023, but we will retain the flexibility to reduce this hiring plan at any time during the year should our leadership deem it necessary. Another item that is impactful to our compensation expense is our incentive burden which would be lower should our results not achieve our 2023 cash incentive plan targets. As many investors are aware, our annual cash incentive awards are always subject to the achievement of predetermined EPS targets. Also, we have several projects and events slated for 2023 which, we could postpone or cancel to reduce our non-compensation cost for this year. We will be closely monitoring our costs and believe we have sufficient flexibility to reduce our noninterest expense run rates at any time should revenues to support these investments not materialize."

PROFITABILITY AND SOUNDNESS:
Three months endedYear ended
Dec. 31, 2022Sept. 30, 2022Dec. 31, 2021Dec. 31, 2022Dec. 31, 2021
Net interest margin3.60 %3.47 %2.96 %3.29 %3.02 %
Efficiency ratio50.29 %48.53 %50.20 %50.47 %49.70 %
Return on average assets1.29 %1.42 %1.39 %1.37 %1.43 %
Return on average tangible common equity (TCE)15.95 %17.40 %16.13 %16.65 %16.88 %
As of
Dec. 31, 2022Sept. 30, 2022Dec. 31, 2021
Stockholder's equity to total assets13.2 %13.0 %13.8 %
Tangible common equity to tangible assets8.5 %8.3 %8.8 %
Book value per common share$69.35 $67.07 $66.89 
Tangible book value per common share$44.74 $42.44 $42.55 
Annualized net loan charge-offs to avg. loans (1)
0.17 %0.16 %0.14 %
Nonperforming assets to total loans, ORE and other nonperforming assets (NPAs)0.16 %0.15 %0.17 %
Classified asset ratio (Pinnacle Bank) (2)
2.40 %2.60 %4.10 %
Allowance for credit losses (ACL) to total loans 1.04 %1.04 %1.12 %
ACL to total loans, excluding PPP1.04 %1.04 %1.14 %
(1): Annualized net loan charge-offs to average loans ratios are computed by annualizing quarterly net loan charge-offs and dividing the result by average loans for the quarter.
(2): Classified assets as a percentage of Tier 1 capital plus allowance for credit losses.

•Net interest margin was 3.60 percent for the fourth quarter of 2022, compared to 3.47 percent for the third quarter of 2022 and 2.96 percent for the fourth quarter of 2021. Net interest margin for the year ended Dec. 31, 2022 was 3.29 percent, compared to 3.02 percent for the year ended Dec. 31, 2021.
•Provision for credit losses was $24.8 million in the fourth quarter of 2022, compared to $27.5 million in the third quarter of 2022 and $2.7 million in the fourth quarter of 2021. Net charge-offs were $11.7 million for the quarter ended Dec. 31, 2022, compared to $11.0 million for the quarter ended Sept. 30, 2022 and $8.1 million for the quarter ended Dec. 31, 2021. Annualized net loan charge-offs for the fourth quarter of 2022 were 0.17 percent.
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•Nonperforming assets were $46.1 million at Dec. 31, 2022, compared to $41.9 million at Sept. 30, 2022 and $40.1 million at Dec. 31, 2021, up 14.9 percent over the same quarter last year. The ratio of the allowance for credit losses to nonperforming loans at Dec. 31, 2022 was 788.8 percent, compared to 844.5 percent at Sept. 30, 2022 and 833.8 percent at Dec. 31, 2021.
•Classified assets were $104.2 million at Dec. 31, 2022, compared to $107.9 million at Sept. 30, 2022 and $151.3 million at Dec. 31, 2021, down 31.1 percent over the same quarter last year.
"We were pleased that our net interest margin increased by approximately 13 basis points during the fourth quarter," Carpenter said. "The growth of our net interest margin slowed from the prior quarter, primarily due to increased deposit costs of 74 basis points in the quarter as depositors increasingly sought a higher return for their deposit dollars and competition for deposits remained fierce. We were also pleased that our tangible book value per common share increased in the fourth quarter to $44.74 at Dec. 31, 2022.
"As to credit metrics, they were consistent with the prior quarter’s results and we believe they remain strong in comparison to historical results. Thus, we enter 2023 from a position of strength should any negative trends materialize. We believe we have some of the most experienced relationship managers and credit officers in our markets and, as a result, believe this experience and their long-tenured relationships translate into client selection practices that result in a borrower base that is better able to weather these challenging economic conditions."

BOARD OF DIRECTORS DECLARES DIVIDENDS AND AUTHORIZES SHARE REPURCHASE PLAN

On Jan. 17, 2023, Pinnacle Financial's Board of Directors approved a quarterly cash dividend of $0.22 per common share to be paid on Feb. 24, 2023 to common shareholders of record as of the close of business on Feb. 3, 2023. Additionally, the Board of Directors approved a quarterly dividend of approximately $3.8 million, or $16.88 per share (or $0.422 per depositary share), on Pinnacle Financial's 6.75 percent Series B Non-Cumulative Perpetual Preferred Stock payable on March 1, 2023 to shareholders of record at the close of business on Feb. 14, 2023. The amount and timing of any future dividend payments to both preferred and common shareholders will be subject to the approval of Pinnacle's Board of Directors.
The firm also announced that its Board of Directors has authorized a new share repurchase program for up to $125 million of the Company’s common stock to commence upon expiration of its existing share repurchase program that is set to expire on March 31, 2023. Repurchases of the Company’s common stock will be made in accordance with applicable laws and may be made at management’s discretion from time to time in the open market, through privately negotiated transactions or otherwise. The board authorized the repurchase program to remain in effect through March 31, 2024, unless the entire repurchase amount has been acquired before that date.
The share repurchase program may be extended, modified, amended, suspended or discontinued at any time at the Company’s discretion and does not commit the Company to repurchase shares of its common stock. The actual timing, number and value of the shares to be purchased under the program will be determined by the Company at its discretion and will depend on a number of factors, including the performance of the Company’s stock price, the Company’s ongoing capital planning considerations, general market and other conditions, applicable legal requirements and compliance with the terms of the Company’s outstanding indebtedness.

WEBCAST AND CONFERENCE CALL INFORMATION

Pinnacle will host a webcast and conference call at 8:30 a.m. CT on Jan. 18, 2023, to discuss fourth quarter 2022 results and other matters. To access the call for audio only, please call 1-877-209-7255. For the presentation and streaming audio, please
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access the webcast on the investor relations page of Pinnacle's website at www.pnfp.com.
For those unable to participate in the webcast, it will be archived on the investor relations page of Pinnacle's website at www.pnfp.com for 90 days following the presentation.
Pinnacle Financial Partners provides a full range of banking, investment, trust, mortgage and insurance products and services designed for businesses and their owners and individuals interested in a comprehensive relationship with their financial institution. The firm is the No. 1 bank in the Nashville-Murfreesboro-Franklin MSA, according to 2022 deposit data from the FDIC, is listed by Forbes among the top 25 banks in the nation and earned a spot on the 2022 list of 100 Best Companies to Work For® in the U.S., its sixth consecutive appearance. Pinnacle was also listed in Fortune magazine as the second best company to work for in the U.S. for women. American Banker recognized Pinnacle as one of America’s Best Banks to Work For nine years in a row and No. 1 among banks with more than $11 billion in assets in 2021.
Pinnacle owns a 49 percent interest in Bankers Healthcare Group (BHG), which provides innovative, hassle-free financial solutions to healthcare practitioners and other professionals. Great Place to Work and FORTUNE ranked BHG No. 4 on its 2021 list of Best Workplaces in New York State in the small/medium business category.
The firm began operations in a single location in downtown Nashville, TN in October 2000 and has since grown to approximately $42.0 billion in assets as of Dec. 31, 2022. As the second-largest bank holding company headquartered in Tennessee, Pinnacle operates in 15 primarily urban markets across the Southeast.
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) deterioration in the financial condition of borrowers of Pinnacle Bank and its subsidiaries or BHG, including as a result of the negative impact of inflationary pressures on our and BHG's customers and their businesses, resulting in significant increases in loan losses and provisions for those losses and, in the case of BHG, substitutions; (ii) fluctuations or differences in interest rates on loans or deposits from those that Pinnacle Financial is modeling or anticipating, including as a result of Pinnacle Bank's inability to better match deposit rates with the changes in the short-term rate environment, or that affect the yield curve; (iii) adverse conditions in the national or local economies including in Pinnacle Financial's markets throughout Tennessee, North Carolina, South Carolina, Georgia, Alabama, Virginia and Kentucky, particularly in commercial and residential real estate markets; (iv) the inability of Pinnacle Financial, or entities in which it has significant investments, like BHG, to maintain the long-term historical growth rate of its, or such entities', loan portfolio; (v) the ability to grow and retain low-cost core deposits and retain large, uninsured deposits, including during times when Pinnacle Bank is seeking to limit the rates it pays on deposits; (vi) changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments; (vii) effectiveness of Pinnacle Financial's asset management activities in improving, resolving or liquidating lower-quality assets; (viii) the impact of competition with other financial institutions, including pricing pressures and the resulting impact on Pinnacle Financial’s results, including as a result of the negative impact to net interest margin from rising deposit and other funding costs; (ix) the results of regulatory examinations; (x) Pinnacle Financial's ability to identify potential candidates for, consummate, and achieve synergies from, potential future acquisitions; (xi) difficulties and delays in integrating acquired businesses or fully realizing costs savings and other benefits from acquisitions; (xii) BHG's ability to profitably grow its business and successfully execute on its business plans; (xiii) risks of expansion into new geographic or product markets; (xiv) any matter that would cause Pinnacle Financial to conclude that there was impairment of any asset, including goodwill or other intangible assets; (xv) the ineffectiveness of Pinnacle Bank's hedging strategies, or the unexpected counterparty failure or hedge failure of the underlying hedges; (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
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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 Bank being a minority investor in BHG, including the risk that the owners of a majority of the equity interests in BHG decide to sell the company or all or a portion of their ownership interests in BHG (triggering a similar sale by Pinnacle Bank); (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) fluctuations in the valuations of Pinnacle Financial's equity investments and the ultimate success of such investments; (xxv) the availability of and access to capital; (xxvi) 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 (xxvii) general competitive, economic, political and market conditions. Additional factors which could affect the forward looking statements can be found in Pinnacle Financial's Annual Report on Form 10-K for the year ended December 31, 2021, and subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the SEC and available on the SEC's website at http://www.sec.gov. Pinnacle Financial disclaims any obligation to update or revise any forward-looking statements contained in this press release, which speak only as of the date hereof, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Matters
This release contains certain non-GAAP financial measures, including, without limitation, earnings per diluted common share, PPNR, 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 and other matters for the accounting periods presented. This release also includes non-GAAP financial measures which exclude the impact of loans originated and forgiven and repaid under the PPP. This release may also contain certain other non-GAAP capital ratios and performance measures that exclude the impact of goodwill and core deposit intangibles associated with Pinnacle Financial's acquisitions of BNC, Avenue Bank, Magna Bank, CapitalMark Bank & Trust, Mid-America Bancshares, Inc., Cavalry Bancorp, Inc. and other acquisitions which collectively are less material to the non-GAAP measure as well as the impact of Pinnacle Financial's Series B Preferred Stock. The presentation of the non-GAAP financial information is not intended to be considered in isolation or as a substitute for any measure prepared in accordance with GAAP. Because non-GAAP financial measures presented in this release are not measurements determined in accordance with GAAP and are susceptible to varying calculations, these non-GAAP financial measures, as presented, may not be comparable to other similarly titled measures presented by other companies.

Pinnacle Financial believes that these non-GAAP financial measures facilitate making period-to-period comparisons and are meaningful indications of its operating performance. In addition, because intangible assets such as goodwill and the core deposit intangible, and the other items excluded each vary extensively from company to company, Pinnacle Financial believes that the presentation of this information allows investors to more easily compare Pinnacle Financial's results to the results of other companies. Pinnacle Financial's management utilizes this non-GAAP financial information to compare Pinnacle Financial's operating performance for 2022 versus certain periods in 2021 and to internally prepared projections.

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PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS – UNAUDITED
(dollars in thousands, except for share and per share data)December 31, 2022September 30, 2022December 31, 2021
ASSETS
Cash and noninterest-bearing due from banks$268,649 $168,010 $188,287 
Restricted cash31,447 18,636 82,505 
Interest-bearing due from banks877,286 1,616,878 3,830,747 
Cash and cash equivalents1,177,382 1,803,524 4,101,539 
Securities purchased with agreement to resell513,276 528,999 1,000,000 
Securities available-for-sale, at fair value3,558,870 3,542,601 4,914,194 
Securities held-to-maturity (fair value of $2.7 billion, $2.5 billion, and $1.2 billion, net of allowance for credit losses of $1.6 million, $1.6 million and $161 at Dec. 31, 2022, Sept. 30, 2022 and Dec. 31, 2021, respectively)3,079,050 2,938,417 1,155,958 
Consumer loans held-for-sale42,237 45,509 45,806 
Commercial loans held-for-sale21,093 15,413 17,685 
Loans29,041,605 27,711,694 23,414,262 
Less allowance for credit losses(300,665)(288,088)(263,233)
Loans, net28,740,940 27,423,606 23,151,029 
Premises and equipment, net327,885 320,273 288,182 
Equity method investment443,185 425,892 360,833 
Accrued interest receivable161,182 110,170 98,813 
Goodwill1,846,973 1,846,466 1,819,811 
Core deposits and other intangible assets34,555 35,666 33,819 
Other real estate owned7,952 7,787 8,537 
Other assets2,015,441 1,955,795 1,473,193 
Total assets$41,970,021 $41,000,118 $38,469,399 
LIABILITIES AND STOCKHOLDERS' EQUITY 
Deposits: 
Noninterest-bearing$9,812,744 $10,567,873 $10,461,071 
Interest-bearing7,884,605 7,549,510 6,530,015 
Savings and money market accounts13,774,534 12,712,809 12,179,663 
Time3,489,355 2,859,857 2,133,784 
Total deposits34,961,238 33,690,049 31,304,533 
Securities sold under agreements to repurchase194,910 190,554 152,559 
Federal Home Loan Bank advances464,436 889,248 888,681 
Subordinated debt and other borrowings424,055 423,834 423,172 
Accrued interest payable19,478 10,202 12,504 
Other liabilities386,512 454,119 377,343 
Total liabilities36,450,629 35,658,006 33,158,792 
Preferred stock, no par value, 10.0 million shares authorized; 225,000 shares non-cumulative perpetual preferred stock, Series B, liquidation preference $225.0 million, issued and outstanding at Dec. 31, 2022, Sept. 30, 2022 and Dec. 31, 2021, respectively217,126 217,126 217,126 
Common stock, par value $1.00; 180.0 million shares authorized; 76.5 million, 76.4 million and 76.1 million shares issued and outstanding at Dec. 31, 2022, Sept. 30, 2022, and Dec. 31, 2021, respectively76,454 76,413 76,143 
Additional paid-in capital3,074,867 3,066,527 3,045,802 
Retained earnings2,341,706 2,224,736 1,864,350 
Accumulated other comprehensive income (loss), net of taxes(190,761)(242,690)107,186 
Total stockholders' equity5,519,392 5,342,112 5,310,607 
Total liabilities and stockholders' equity$41,970,021 $41,000,118 $38,469,399 
This information is preliminary and based on company data available at the time of the presentation.
9

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME – UNAUDITED
(dollars in thousands, except for share and per share data)Three months endedYear ended
 December 31, 2022September 30, 2022December 31, 2021December 31, 2022December 31, 2021
Interest income:
Loans, including fees$387,328 $315,935 $230,026 $1,182,492 $924,043 
Securities
Taxable25,086 18,204 9,696 67,063 34,769 
Tax-exempt22,770 21,408 16,931 81,522 64,848 
Federal funds sold and other15,994 16,217 2,540 42,858 7,554 
Total interest income451,178 371,764 259,193 1,373,935 1,031,214 
Interest expense:
Deposits120,499 55,189 10,648 204,119 54,116 
Securities sold under agreements to repurchase474 182 54 794 239 
FHLB advances and other borrowings10,745 10,609 9,728 39,729 44,458 
Total interest expense131,718 65,980 20,430 244,642 98,813 
Net interest income319,460 305,784 238,763 1,129,293 932,401 
Provision for credit losses24,805 27,493 2,675 67,925 16,126 
Net interest income after provision for credit losses294,655 278,291 236,088 1,061,368 916,275 
Noninterest income:
Service charges on deposit accounts11,123 10,906 12,663 44,675 41,311 
Investment services11,765 10,780 11,081 46,441 37,917 
Insurance sales commissions2,668 2,928 2,328 12,186 10,516 
Gains (losses) on mortgage loans sold, net(65)1,117 4,244 7,268 32,424 
Investment gains on sales, net— 217 393 156 759 
Trust fees5,767 5,706 5,926 23,511 20,724 
Income from equity method investment21,005 41,341 30,844 145,466 122,274 
Other noninterest income30,058 31,810 33,244 136,421 129,809 
Total noninterest income82,321 104,805 100,723 416,124 395,734 
Noninterest expense:
Salaries and employee benefits131,802 129,910 110,048 510,175 436,006 
Equipment and occupancy29,329 27,886 24,997 109,672 95,250 
Other real estate, net179 (90)37 280 (712)
Marketing and other business development7,579 4,958 4,562 21,073 12,888 
Postage and supplies2,682 2,795 2,191 10,168 8,195 
Amortization of intangibles1,937 1,951 2,057 7,810 8,518 
Other noninterest expense28,539 31,843 26,525 120,821 99,959 
Total noninterest expense202,047 199,253 170,417 779,999 660,104 
Income before income taxes174,929 183,843 166,394 697,493 651,905 
Income tax expense 37,082 35,185 32,866 136,751 124,582 
Net income137,847 148,658 133,528 560,742 527,323 
Preferred stock dividends(3,798)(3,798)(3,798)(15,192)(15,192)
Net income available to common shareholders$134,049 $144,860 $129,730 $545,550 $512,131 
Per share information:
Basic net income per common share$1.77 $1.91 $1.72 $7.20 $6.79 
Diluted net income per common share$1.76 $1.91 $1.71 $7.17 $6.75 
Weighted average common shares outstanding:
Basic75,771,828 75,761,930 75,523,052 75,735,404 75,468,339 
Diluted76,198,411 75,979,056 76,024,700 76,133,865 75,927,147 
This information is preliminary and based on company data available at the time of the presentation.
10

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(Unaudited)

(dollars and shares in thousands)Preferred
Stock
 Amount		Common StockAdditional Paid-in CapitalRetained EarningsAccumulated Other Comp. Income (Loss), netTotal Shareholders' Equity
 SharesAmounts
Balance at December 31, 2020$217,126 75,850 $75,850 $3,028,063 $1,407,723 $175,849 $4,904,611 
Exercise of employee common stock options & related tax benefits— 45 45 956 — — 1,001 
Preferred dividends paid ($67.52 per share)— — — — (15,192)— (15,192)
Common dividends paid ($0.72 per share)— — — — (55,504)— (55,504)
Issuance of restricted common shares, net of forfeitures— 213 213 (213)— — — 
Restricted shares withheld for taxes & related tax benefits— (53)(53)(4,078)— — (4,131)
Issuance of common stock pursuant to restricted stock unit (RSU) and performance stock unit (PSU) agreements, net of shares withheld for taxes & related tax benefits— 88 88 (3,878)— — (3,790)
Compensation expense for restricted shares & performance stock units— — — 24,952 — — 24,952 
Net income— — — — 527,323 — 527,323 
Other comprehensive loss— — — — — (68,663)(68,663)
Balance at December 31, 2021$217,126 76,143 $76,143 $3,045,802 $1,864,350 $107,186 $5,310,607 
Balance at December 31, 2021$217,126 76,143 $76,143 $3,045,802 $1,864,350 $107,186 $5,310,607 
Exercise of employee common stock options & related tax benefits— 16 16 312 — — 328 
Preferred dividends paid ($67.52 per share)— — — — (15,192)— (15,192)
Common dividends paid ($0.88 per share)— — — — (68,194)— (68,194)
Issuance of restricted common shares, net of forfeitures— 203 203 (203)— — — 
Restricted shares withheld for taxes & related tax benefits— (51)(51)(4,991)— — (5,042)
Issuance of common stock pursuant to RSU and PSU agreements, net of shares withheld for taxes & related tax benefits— 143 143 (5,605)— — (5,462)
Compensation expense for restricted shares & performance stock units— — — 39,552 — — 39,552 
Net income— — — — 560,742 — 560,742 
Other comprehensive loss— — — — — (297,947)(297,947)
Balance at December 31, 2022$217,126 76,454 $76,454 $3,074,867 $2,341,706 $(190,761)$5,519,392 


11

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED
(dollars in thousands)December SeptemberJuneMarchDecemberSeptember
202220222022202220212021
Balance sheet data, at quarter end:
Commercial and industrial loans$10,233,395 9,738,271 9,244,708 8,213,204 7,703,428 7,079,431 
Commercial real estate - owner occupied loans3,587,257 3,426,271 3,243,018 3,124,275 3,048,822 2,954,519 
Commercial real estate - investment loans5,277,454 5,122,127 4,909,598 4,707,761 4,607,048 4,597,736 
Commercial real estate - multifamily and other loans1,265,165 1,042,854 951,998 718,822 614,656 621,471 
Consumer real estate  - mortgage loans4,435,046 4,271,913 4,047,051 3,813,252 3,680,684 3,540,439 
Construction and land development loans3,679,498 3,548,970 3,386,866 3,277,029 2,903,017 3,096,961 
Consumer and other loans555,823 550,565 498,757 487,499 485,489 459,182 
Paycheck protection program loans7,967 10,723 51,100 157,180 371,118 708,722 
Total loans29,041,605 27,711,694 26,333,096 24,499,022 23,414,262 23,058,461 
Allowance for credit losses(300,665)(288,088)(272,483)(261,618)(263,233)(268,635)
Securities6,637,920 6,481,018 6,553,893 6,136,109 6,070,152 5,623,890 
Total assets41,970,021 41,000,118 40,121,292 39,400,378 38,469,399 36,523,936 
Noninterest-bearing deposits9,812,744 10,567,873 11,058,198 10,986,194 10,461,071 9,809,691 
Total deposits34,961,238 33,690,049 32,595,303 32,295,814 31,304,533 29,369,807 
Securities sold under agreements to repurchase194,910 190,554 199,585 219,530 152,559 148,240 
FHLB advances464,436 889,248 1,289,059 888,870 888,681 888,493 
Subordinated debt and other borrowings424,055 423,834 423,614 423,319 423,172 542,712 
Total stockholders' equity5,519,392 5,342,112 5,315,239 5,280,950 5,310,607 5,191,798 
Balance sheet data, quarterly averages:
Total loans$28,402,197 27,021,031 25,397,389 23,848,533 23,225,735 22,986,835 
Securities6,537,262 6,542,026 6,446,774 6,143,664 5,813,636 5,451,232 
Federal funds sold and other1,828,588 2,600,978 2,837,679 4,799,946 4,356,113 3,743,074 
Total earning assets36,768,047 36,164,035 34,681,842 34,792,143 33,395,484 32,181,141 
Total assets41,324,251 40,464,649 38,780,786 38,637,221 37,132,078 35,896,130 
Noninterest-bearing deposits10,486,233 10,926,069 10,803,439 10,478,403 10,240,393 9,247,382 
Total deposits34,177,281 33,108,415 31,484,100 31,538,985 30,034,026 28,739,871 
Securities sold under agreements to repurchase199,610 215,646 216,846 179,869 141,781 164,837 
FHLB advances701,813 1,010,865 1,095,531 888,746 888,559 888,369 
Subordinated debt and other borrowings427,503 426,267 427,191 441,755 484,389 586,387 
Total stockholders' equity5,433,274 5,403,244 5,316,219 5,331,405 5,262,586 5,176,625 
Statement of operations data, for the three months ended:
Interest income$451,178 371,764 292,376 258,617 259,193 260,868 
Interest expense131,718 65,980 27,802 19,142 20,430 23,325 
Net interest income319,460 305,784 264,574 239,475 238,763 237,543 
Provision for credit losses24,805 27,493 12,907 2,720 2,675 3,382 
Net interest income after provision for credit losses294,655 278,291 251,667 236,755 236,088 234,161 
Noninterest income82,321 104,805 125,502 103,496 100,723 104,095 
Noninterest expense202,047 199,253 196,038 182,661 170,417 168,851 
Income before taxes174,929 183,843 181,131 157,590 166,394 169,405 
Income tax expense37,082 35,185 36,004 28,480 32,866 32,828 
Net income137,847 148,658 145,127 129,110 133,528 136,577 
Preferred stock dividends(3,798)(3,798)(3,798)(3,798)(3,798)(3,798)
Net income available to common shareholders$134,049 144,860 141,329 125,312 129,730 132,779 
Profitability and other ratios:
Return on avg. assets (1)
1.29 %1.42 %1.46 %1.32 %1.39 %1.47 %
Return on avg. equity (1)
9.79 %10.64 %10.66 %9.53 %9.78 %10.18 %
 Return on avg. common equity (1)
10.20 %11.08 %11.12 %9.94 %10.20 %10.62 %
Return on avg. tangible common equity (1)
15.95 %17.40 %17.62 %15.63 %16.13 %16.98 %
Common stock dividend payout ratio (15)
12.26 %12.34 %12.63 %12.94 %10.65 %11.13 %
Net interest margin (2)
3.60 %3.47 %3.17 %2.89 %2.96 %3.03 %
Noninterest income to total revenue (3)
20.49 %25.53 %32.17 %30.18 %29.67 %30.47 %
Noninterest income to avg. assets (1)
0.79 %1.03 %1.30 %1.09 %1.08 %1.15 %
Noninterest exp. to avg. assets (1)
1.94 %1.95 %2.03 %1.92 %1.82 %1.87 %
Efficiency ratio (4)
50.29 %48.53 %50.26 %53.26 %50.20 %49.42 %
Avg. loans to avg. deposits
83.10 %81.61 %80.67 %75.62 %77.33 %79.98 %
Securities to total assets
15.82 %15.81 %16.34 %15.57 %15.78 %15.40 %
This information is preliminary and based on company data available at the time of the presentation.

12

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
ANALYSIS OF INTEREST INCOME AND EXPENSE, RATES AND YIELDS-UNAUDITED
(dollars in thousands)Three months endedThree months ended
December 31, 2022December 31, 2021
 Average BalancesInterestRates/ YieldsAverage BalancesInterestRates/ Yields
Interest-earning assets
Loans (1) (2)
$28,402,197 $387,328 5.54 %$23,225,735 $230,026 4.04 %
Securities
Taxable3,421,072 25,086 2.91 %3,112,605 9,696 1.24 %
Tax-exempt (2)
3,116,190 22,770 3.49 %2,701,031 16,931 3.04 %
Interest-bearing due from banks1,117,468 10,626 3.77 %3,481,902 1,402 0.16 %
Resell agreements521,787 3,432 2.61 %706,522 598 0.34 %
Federal funds sold— — — %— — — %
Other189,333 1,936 4.06 %167,689 540 1.28 %
Total interest-earning assets36,768,047 $451,178 5.02 %33,395,484 $259,193 3.20 %
Nonearning assets
Intangible assets1,881,597 1,854,963 
Other nonearning assets2,674,607 1,881,631 
Total assets$41,324,251 $37,132,078 
Interest-bearing liabilities
Interest-bearing deposits:
Interest checking7,262,128 36,808 2.01 %5,799,700 2,427 0.17 %
Savings and money market13,337,326 68,677 2.04 %11,777,899 5,153 0.17 %
Time3,091,594 15,014 1.93 %2,216,034 3,068 0.55 %
Total interest-bearing deposits23,691,048 120,499 2.02 %19,793,633 10,648 0.21 %
Securities sold under agreements to repurchase199,610 474 0.94 %141,781 54 0.15 %
Federal Home Loan Bank advances701,813 5,380 3.04 %888,559 4,558 2.04 %
Subordinated debt and other borrowings427,503 5,365 4.98 %484,389 5,170 4.23 %
Total interest-bearing liabilities25,019,974 131,718 2.09 %21,308,362 20,430 0.38 %
Noninterest-bearing deposits10,486,233 — — 10,240,393 — — 
Total deposits and interest-bearing liabilities35,506,207 $131,718 1.47 %31,548,755 $20,430 0.26 %
Other liabilities384,770 320,737 
Stockholders' equity 5,433,274 5,262,586 
Total liabilities and stockholders' equity$41,324,251 $37,132,078 
Net  interest  income 
$319,460 $238,763 
Net interest spread (3)
2.93 %2.82 %
Net interest margin (4)
3.60 %2.96 %
(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 $14.1 million of taxable equivalent income for the three months ended December 31, 2022 compared to $10.1 million for the three months ended December 31, 2021. 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 December 31, 2022 would have been 3.55% compared to a net interest spread of 2.94% for the three months ended December 31, 2021.
(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.  

13

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
ANALYSIS OF INTEREST INCOME AND EXPENSE, RATES AND YIELDS-UNAUDITED
(dollars in thousands)Year endedYear ended
December 31, 2022December 31, 2021
 Average BalancesInterestRates/ YieldsAverage BalancesInterestRates/ Yields
Interest-earning assets
Loans (1) (2)
$26,182,102 $1,182,492 4.62 %$23,060,949 $924,043 4.09 %
Securities
Taxable3,405,346 67,063 1.97 %2,711,044 34,769 1.28 %
Tax-exempt (2)
3,013,505 81,522 3.26 %2,534,653 64,848 3.09 %
Interest-bearing due from banks1,815,251 23,206 1.28 %3,056,555 3,853 0.13 %
Resell agreements1,010,443 14,106 1.40 %426,027 1,440 0.34 %
Federal funds sold— — — %9,964 — — %
Other 181,824 5,546 3.05 %160,066 2,261 1.41 %
Total interest-earning assets35,608,471 $1,373,935 3.98 %31,959,258 $1,031,214 3.33 %
Nonearning assets
Intangible assets1,877,870 1,858,119 
Other nonearning assets2,324,564 1,875,255 
Total assets$39,810,905 $35,692,632 
Interest-bearing liabilities
Interest-bearing deposits:
Interest checking6,737,026 63,549 0.94 %5,578,632 9,887 0.18 %
Savings and money market12,695,974 112,218 0.88 %11,437,779 22,823 0.20 %
Time2,478,629 28,352 1.14 %2,682,315 21,406 0.80 %
Total interest-bearing deposits21,911,629 204,119 0.93 %19,698,726 54,116 0.27 %
Securities sold under agreements to repurchase203,082 794 0.39 %155,888 239 0.15 %
Federal Home Loan Bank advances923,964 20,848 2.26 %899,785 18,111 2.01 %
Subordinated debt and other borrowings429,169 18,881 4.40 %604,081 26,347 4.36 %
Total interest-bearing liabilities23,467,844 244,642 1.04 %21,358,480 98,813 0.46 %
Noninterest-bearing deposits10,674,249 — — 8,910,349 — — 
Total deposits and interest-bearing liabilities34,142,093 $244,642 0.72 %30,268,829 $98,813 0.33 %
Other liabilities297,409 314,650 
Stockholders' equity 5,371,403 5,109,153 
Total liabilities and stockholders' equity$39,810,905 $35,692,632 
Net  interest  income 
$1,129,293 $932,401 
Net interest spread (3)
2.94 %2.87 %
Net interest margin (4)
3.29 %3.02 %
(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 $43.0 million of taxable equivalent income for the year ended December 31, 2022 compared to $33.8 million for the year ended December 31, 2021. 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 year ended December 31, 2022 would have been 3.26% compared to a net interest spread of 3.01% for the year ended December 31, 2021.
(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
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED
(dollars in thousands)December SeptemberJuneMarchDecemberSeptember
202220222022202220212021
Asset quality information and ratios:
Nonperforming assets:
Nonaccrual loans$38,116 34,115 15,459 26,616 31,569 46,692 
ORE and other nonperforming assets (NPAs)
7,952 7,787 8,237 8,437 8,537 8,415 
Total nonperforming assets$46,068 41,902 23,696 35,053 40,106 55,107 
Past due loans over 90 days and still accruing interest$4,406 6,757 3,840 1,605 1,607 1,914 
Accruing troubled debt restructurings (5)
$2,193 2,228 2,279 2,317 2,354 2,397 
Accruing purchase credit deteriorated loans$8,060 8,759 9,194 12,661 13,086 12,158 
Net loan charge-offs$11,729 10,983 877 2,958 8,077 9,281 
Allowance for credit losses to nonaccrual loans788.8 %844.5 %1,762.6 %982.9 %833.8 %575.3 %
As a percentage of total loans:
Past due accruing loans over 30 days0.15 %0.13 %0.11 %0.11 %0.09 %0.09 %
Potential problem loans
0.19 %0.21 %0.32 %0.41 %0.47 %0.60 %
Allowance for credit losses 1.04 %1.04 %1.03 %1.07 %1.12 %1.17 %
Nonperforming assets to total loans, ORE and other NPAs0.16 %0.15 %0.09 %0.14 %0.17 %0.24 %
    Classified asset ratio (Pinnacle Bank) (7)
2.4 %2.6 %2.9 %3.6 %4.1 %5.6 %
Annualized net loan charge-offs to avg. loans (6)
0.17 %0.16 %0.01 %0.05 %0.14 %0.16 %
Interest rates and yields:
Loans5.54 %4.73 %4.07 %3.94 %4.04 %4.13 %
Securities3.19 %2.66 %2.29 %2.12 %2.08 %2.04 %
Total earning assets5.02 %4.20 %3.49 %3.11 %3.20 %3.32 %
Total deposits, including non-interest bearing1.40 %0.66 %0.23 %0.13 %0.14 %0.17 %
Securities sold under agreements to repurchase0.94 %0.34 %0.15 %0.13 %0.15 %0.14 %
FHLB advances3.04 %2.26 %1.92 %2.04 %2.04 %2.04 %
Subordinated debt and other borrowings4.98 %4.51 %4.04 %4.00 %4.23 %4.45 %
Total deposits and interest-bearing liabilities1.47 %0.75 %0.34 %0.23 %0.26 %0.30 %
Capital and other ratios (7):
Pinnacle Financial ratios:
Stockholders' equity to total assets13.2 %13.0 %13.2 %13.4 %13.8 %14.2 %
Common equity Tier one10.0 %10.0 %10.2 %10.5 %10.9 %10.5 %
Tier one risk-based10.5 %10.7 %10.9 %11.2 %11.7 %11.3 %
Total risk-based12.4 %12.6 %12.9 %13.3 %13.8 %14.0 %
Leverage9.7 %9.7 %9.8 %9.5 %9.7 %9.3 %
Tangible common equity to tangible assets8.5 %8.3 %8.4 %8.5 %8.8 %9.0 %
Pinnacle Bank ratios:
Common equity Tier one10.9 %11.1 %11.0 %11.4 %11.9 %11.7 %
Tier one risk-based10.9 %11.1 %11.0 %11.4 %11.9 %11.7 %
Total risk-based11.6 %11.8 %11.7 %12.1 %12.6 %12.5 %
Leverage10.1 %10.1 %9.9 %9.6 %9.9 %9.7 %
Construction and land development loans
as a percentage of total capital (18)
85.9 %85.4 %87.4 %87.4 %79.1 %89.3 %
Non-owner occupied commercial real estate and
multi-family as a percentage of total capital (18)
249.6 %244.0 %250.2 %243.7 %234.1 %252.4 %
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, except per share data)December SeptemberJuneMarchDecemberSeptember
202220222022202220212021
Per share data:
Earnings per common share – basic$1.77 1.91 1.87 1.66 1.72 1.76 
Earnings per common share - basic, excluding non-GAAP adjustments$1.77 1.91 1.87 1.66 1.71 1.76 
Earnings per common share – diluted$1.76 1.91 1.86 1.65 1.71 1.75 
Earnings per common share - diluted, excluding non-GAAP adjustments$1.76 1.91 1.86 1.65 1.70 1.75 
Common dividends per share$0.22 0.22 0.22 0.22 0.18 0.18 
Book value per common share at quarter end (8)
$69.35 67.07 66.74 66.30 66.89 65.36 
Tangible book value per common share at quarter end (8)
$44.74 42.44 42.08 41.65 42.55 40.98 
Revenue per diluted common share$5.27 5.40 5.14 4.52 4.47 4.50 
Revenue per diluted common share, excluding non-GAAP adjustments$5.27 5.40 5.14 4.52 4.46 4.50 
Investor information:
Closing sales price of common stock on last trading day of quarter$73.40 81.10 72.31 92.08 95.50 94.08 
High closing sales price of common stock during quarter$87.81 87.66 91.42 110.41 104.72 98.00 
Low closing sales price of common stock during quarter$70.74 68.68 68.56 90.46 90.20 83.84 
Closing sales price of depositary shares on last trading day of quarter$25.35 25.33 25.19 26.72 28.21 28.14 
High closing sales price of depositary shares during quarter$25.60 26.23 26.44 28.53 28.99 29.23 
Low closing sales price of depositary shares during quarter$23.11 24.76 24.75 25.63 27.42 28.00 
Other information:
Residential mortgage loan sales:
Gross loans sold$134,514 181,139 239,736 270,793 352,342 347,664 
Gross fees (9)
$3,149 3,189 6,523 5,700 10,098 11,215 
Gross fees as a percentage of loans originated2.34 %1.76 %2.72 %2.11 %2.87 %3.23 %
Net gain (loss) on residential mortgage loans sold$(65)1,117 2,150 4,066 4,244 7,814 
Investment gains (losses) on sales of securities, net (14)
$— 217 — (61)393 — 
Brokerage account assets, at quarter end (10)
$8,049,125 7,220,405 6,761,480 7,158,939 7,187,085 6,597,152 
Trust account managed assets, at quarter end$4,560,752 4,162,639 4,207,406 4,499,911 4,720,290 4,155,510 
Core deposits (11)
$31,301,077 30,748,817 30,011,444 30,398,683 29,316,911 27,170,367 
Core deposits to total funding (11)
86.9 %87.4 %87.0 %89.9 %89.5 %87.8 %
Risk-weighted assets$36,216,901 35,281,315 33,366,074 31,170,258 29,349,534 27,945,624 
Number of offices 123 120 119 119 118 117 
Total core deposits per office$254,480 256,240 252,197 255,451 248,448 232,225 
Total assets per full-time equivalent employee$12,948 12,875 13,052 13,186 13,541 13,188 
Annualized revenues per full-time equivalent employee$491.8 511.5 509.0 465.5 474.1 489.4 
Annualized expenses per full-time equivalent employee$247.3 248.2 255.8 247.9 238.0 241.9 
Number of employees (full-time equivalent)3,241.5 3,184.5 3,074.0 2,988.0 2,841.0 2,769.5 
Associate retention rate (12)
93.8 %93.6 %93.3 %93.1 %93.4 %93.4 %
This information is preliminary and based on company data available at the time of the presentation.


16

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED
Three months ended
Year ended
(dollars in thousands, except per share data)
DecemberSeptemberDecemberDecemberDecember
20222022202120222021
Net interest income$319,460305,784238,7631,129,293932,401
Noninterest income82,321104,805100,723416,124395,734
Total revenues401,781410,589339,4861,545,4171,328,135
Less: Investment (gains) losses on sales of securities, net—(217)(393)(156)(759)
Total revenues excluding the impact of adjustments noted above$401,781410,372339,0931,545,2611,327,376
Noninterest expense$202,047199,253170,417779,999660,104
Less: ORE expense (benefit)179(90)37280(712)
Noninterest expense excluding the impact of adjustments noted above$201,868199,343170,380779,719660,816
Pre-tax income$174,929183,843166,394697,493651,905
Provision for credit losses24,80527,4932,67567,92516,126
Pre-tax pre-provision net revenue199,734211,336169,069765,418668,031
Adjustments noted above179(307)(356)124(1,471)
Adjusted pre-tax pre-provision net revenue (13)
$199,913211,029168,713765,542666,560
Noninterest income$82,321104,805100,723416,124395,734
Less: Adjustments as noted above—(217)(393)(156)(759)
Noninterest income excluding the impact of adjustments noted above$82,321104,588100,330415,968394,975
Efficiency ratio (4)
50.29 %48.53 %50.20 %50.47 %49.70 %
Adjustments as noted above(0.05)%0.05 %0.05 %(0.01)%0.08 %
Efficiency ratio (excluding adjustments noted above) (4)
50.24 %48.58 %50.25 %50.46 %49.78 %
Total average assets$41,324,25140,464,64937,132,07839,810,90535,692,632
Noninterest income to average assets (1)
0.79 %1.03 %1.08 %1.05 %1.11 %
Adjustments as noted above— %— %(0.01)%(0.01)%— %
Noninterest income (excluding adjustments noted above) to average assets (1)
0.79 %1.03 %1.07 %1.04 %1.11 %
Noninterest expense to average assets (1)
1.94 %1.95 %1.82 %1.96 %1.85 %
Adjustments as noted above— %— %— %— %— %
Noninterest expense (excluding adjustments noted above) to average assets (1)
1.94 %1.95 %1.82 %1.96 %1.85 %
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
(dollars in thousands, except per share data)DecemberSeptemberJuneMarchDecemberSeptember
202220222022202220212021
Net income available to common shareholders$134,049 144,860 141,329 125,312 129,730 132,779 
Investment (gains) losses on sales of securities, net— (217)— 61 (393)— 
ORE expense (benefit)179 (90)86 105 37 (79)
Tax effect on adjustments noted above (17)
(47)80 (22)(43)93 21 
Net income available to common shareholders excluding adjustments noted above $134,181 144,633 141,393 125,435 129,467 132,721 
Basic earnings per common share$1.77 1.91 1.87 1.66 1.72 1.76 
Adjustment due to investment (gains) losses on sales of securities, net— — — — (0.01)— 
Adjustment due to ORE expense (benefit)— — — — — — 
Adjustment due to tax effect on adjustments noted above (17)
— — — — — — 
Basic earnings per common share excluding adjustments noted above$1.77 1.91 1.87 1.66 1.71 1.76 
Diluted earnings per common share$1.76 1.91 1.86 1.65 1.71 1.75 
Adjustment due to investment (gains) losses on sales of securities, net— — — — (0.01)— 
Adjustment due to ORE expense (benefit)— — — — — — 
Adjustment due to tax effect on adjustments noted above (17)
— — — — — — 
Diluted earnings per common share excluding the adjustments noted above$1.76 1.91 1.86 1.65 1.70 1.75 
Revenue per diluted common share$5.27 5.40 5.14 4.52 4.47 4.50 
Adjustments as noted above— — — — (0.01)— 
Revenue per diluted common share excluding adjustments noted above$5.27 5.40 5.14 4.52 4.46 4.50 
Book value per common share at quarter end (8)
$69.35 67.07 66.74 66.30 66.89 65.36 
Adjustment due to goodwill, core deposit and other intangible assets(24.61)(24.63)(24.66)(24.65)(24.34)(24.38)
Tangible book value per common share at quarter end (8)
$44.74 42.44 42.08 41.65 42.55 40.98 
Paycheck Protection Program (PPP)
PPP net interest income$72 755 4,060 10,690 15,131 20,420 
Income tax expense at statutory rates (17)
19 197 1,061 2,794 3,955 5,338 
Earnings attributable to PPP53 558 2,999 7,896 11,176 15,082 
Basic earnings per common share attributable to PPP$— 0.01 0.04 0.10 0.15 0.20 
Diluted earnings per common share attributable to PPP$— 0.01 0.04 0.10 0.15 0.20 
Equity method investment (16)
Fee income from BHG, net of amortization$21,005 41,341 49,465 33,655 30,844 30,409 
Funding cost to support investment4,586 3,891 1,998 666 388 379 
Pre-tax impact of BHG16,419 37,450 47,467 32,989 30,456 30,030 
Income tax expense at statutory rates (17)
4,292 9,789 12,408 8,623 7,961 7,850 
Earnings attributable to BHG$12,127 27,661 35,059 24,366 22,495 22,180 
Basic earnings per common share attributable to BHG$0.16 0.37 0.46 0.32 0.30 0.29 
Diluted earnings per common share attributable to BHG$0.16 0.36 0.46 0.32 0.30 0.29 
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
Year ended
(dollars in thousands, except per share data)December 31,
20222021
Net income available to common shareholders$545,550 512,131 
Investment (gains) losses on sales of securities, net(156)(759)
ORE expense (benefit)280 (712)
Tax effect on adjustments noted above (17)
(32)385 
Net income available to common shareholders excluding adjustments noted above $545,642 511,045 
Basic earnings per common share$7.20 6.79 
Adjustment due to investment (gains) losses on sales of securities, net— (0.01)
Adjustment due to ORE expense (benefit)— (0.01)
Adjustment due to tax effect on adjustments noted above (17)
— — 
Basic earnings per common share excluding adjustments noted above$7.20 6.77 
Diluted earnings per common share7.17 6.75 
Adjustment due to investment (gains) losses on sales of securities, net— (0.01)
Adjustment due to ORE expense (benefit)— (0.01)
Adjustment due to tax effect on adjustments noted above (17)
— — 
Diluted earnings per common share excluding the adjustments noted above$7.17 6.73 
Revenue per diluted common share$20.30 17.49 
Adjustments as noted above— (0.01)
Revenue per diluted common share excluding adjustments noted above$20.30 17.48 
Paycheck Protection Program (PPP)
PPP net interest income15,577 81,431 
Income tax expense at statutory rates (17)
4,072 21,286 
Earnings attributable to PPP$11,505 60,145 
Basic earnings per common share attributable to PPP$0.15 0.80 
Diluted earnings per common share attributable to PPP$0.15 0.79 
Equity method investment (16)
Fee income from BHG, net of amortization$145,466 122,274 
Funding cost to support investment11,141 3,202 
Pre-tax impact of BHG134,325 119,072 
Income tax expense at statutory rates (17)
35,113 31,125 
Earnings attributable to BHG$99,212 87,947 
Basic earnings per common share attributable to BHG$1.31 1.17 
Diluted earnings per common share attributable to BHG$1.30 1.16 
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
Three months ended
Year ended
(dollars in thousands, except per share data)
DecemberSeptemberDecemberDecemberDecember
20222022202120222021
Return on average assets (1)
1.29 %1.42 %1.39 %1.37 %1.43 %
Adjustments as noted above— %— %(0.01)%— %— %
Return on average assets excluding adjustments noted above (1)
1.29 %1.42 %1.38 %1.37 %1.43 %
Tangible assets:
Total assets$41,970,02141,000,11838,469,399$41,970,02138,469,399
Less:   Goodwill(1,846,973)(1,846,466)(1,819,811)(1,846,973)(1,819,811)
Core deposit and other intangible assets(34,555)(35,666)(33,819)(34,555)(33,819)
Net tangible assets$40,088,49339,117,98636,615,769$40,088,49336,615,769
Tangible common equity:
Total stockholders' equity$5,519,3925,342,1125,310,607$5,519,3925,310,607
Less: Preferred stockholders' equity(217,126)(217,126)(217,126)(217,126)(217,126)
Total common stockholders' equity5,302,2665,124,9865,093,4815,302,2665,093,481
Less: Goodwill(1,846,973)(1,846,466)(1,819,811)(1,846,973)(1,819,811)
Core deposit and other intangible assets(34,555)(35,666)(33,819)(34,555)(33,819)
Net tangible common equity$3,420,7383,242,8543,239,851$3,420,7383,239,851
Ratio of tangible common equity to tangible assets8.53 %8.29 %8.85 %8.53 %8.85 %
Average tangible assets:
Average assets$41,324,25140,464,64937,132,078$39,810,90535,692,632
Less: Average goodwill(1,846,471)(1,846,466)(1,819,811)(1,843,708)(1,819,811)
Average core deposit and other intangible assets(35,126)(36,884)(35,152)(34,162)(38,308)
Net average tangible assets$39,442,65438,581,29935,277,115$37,933,03533,834,513
Return on average assets (1)
1.29 %1.42 %1.39 %1.37 %1.43 %
Adjustment due to goodwill, core deposit and other intangible assets0.06 %0.07 %0.07 %0.07 %0.08 %
Return on average tangible assets (1)
1.35 %1.49 %1.46 %1.44 %1.51 %
Adjustments as noted above— %— %— %— %— %
Return on average tangible assets excluding adjustments noted above (1)
1.35 %1.49 %1.46 %1.44 %1.51 %
Average tangible common equity:
Average stockholders' equity$5,433,2745,403,2445,262,586$5,371,4035,109,153
Less: Average preferred equity(217,126)(217,126)(217,126)(217,126)(217,126)
Average common equity5,216,1485,186,1185,045,4605,154,2774,892,027
Less:   Average goodwill(1,846,471)(1,846,466)(1,819,811)(1,843,708)(1,819,811)
Average core deposit and other intangible assets(35,126)(36,884)(35,152)(34,162)(38,308)
Net average tangible common equity$3,334,5513,302,7683,190,497$3,276,4073,033,908
Return on average equity (1)
9.79 %10.64 %9.78 %10.16 %10.02 %
Adjustment due to average preferred stockholders' equity0.41 %0.44 %0.42 %0.42 %0.45 %
Return on average common equity (1)
10.20 %11.08 %10.20 %10.58 %10.47 %
Adjustment due to goodwill, core deposit and other intangible assets5.75 %6.32 %5.93 %6.07 %6.41 %
Return on average tangible common equity (1)
15.95 %17.40 %16.13 %16.65 %16.88 %
Adjustments as noted above0.01 %(0.03)%(0.03)%— %(0.04)%
Return on average tangible common equity excluding adjustments noted above (1)
15.96 %17.37 %16.10 %16.65 %16.84 %
Allowance for credit losses on loans as a percent of total loans 1.04 %1.04 %1.12 %1.04 %1.12 %
Impact of excluding PPP loans from total loans— %— %0.02 %— %0.02 %
Allowance as adjusted for the above exclusion of PPP loans from total loans1.04 %1.04 %1.14 %1.04 %1.14 %
This information is preliminary and based on company data available at the time of the presentation.

20

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. 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.
7. 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.
8. 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.
9. Amounts are included in the statement of operations in "Gains on mortgage loans sold, net", net of commissions paid on such amounts.
10. At fair value, based on information obtained from Pinnacle's third party broker/dealer for non-FDIC insured financial products and services.
11. 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.
12. 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.
13. Adjusted pre-tax, pre-provision net revenue excludes the impact of ORE expenses and income and investment gains and losses on sales of securities.
14. 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.
15. 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.
16. 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.
17. Tax effect calculated using the blended statutory rate of 26.14 percent.
18. Calculated using the same guidelines as are used in the Federal Financial Institutions Examination Council's Uniform Bank Performance Report.

21