PNFP Reports 2Q24 Diluted EPS of $0.64 and Net Interest Margin of 3.14 Percent

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Pinnacle Financial Partners has reported a significant decrease in net income per diluted common share for the second quarter of 2024. The reported figure of $0.64 is down approximately 74.8% compared to the same quarter last year. When adjusted for capital optimization and balance sheet repositioning, EPS is $1.63, reflecting a more accurate ongoing performance metric.

The noticeable drop in income is largely due to investment losses and termination fees from reselling securities. Despite this, net interest margin (NIM) has shown a modest increase from 3.04% in Q1 2024 to 3.14% in Q2 2024, indicating some positive momentum in core lending activities.

For retail investors, this implies a more cautious view. The adjusted figures suggest that while the firm faced significant one-time losses, its core operations remain robust with a potential for steady growth. However, investors need to watch for future NIM trends and any further impacts from similar balance sheet adjustments.

Long-term impacts could be favorable if Pinnacle's repositioning leads to sustained improvement in yield. On the downside, the increased expenses and one-time fees show the costs associated with these strategic shifts. Investors should particularly note the resilience in core deposit growth and loan growth, as these are critical for future earnings stability.

Analyzing Pinnacle Financial Partners' business growth strategy shows they have aggressively pursued market expansion and hiring initiatives. The firm added 89 new revenue producers in the first half of 2024, indicating a significant investment in human resources to drive future growth. This is further supported by the robust loan growth observed in new markets, particularly the Jacksonville expansion.

The strategic goal of reducing high-risk commercial real estate exposures aligns with industry trends of cautious lending in this segment, highlighting a prudent risk management approach. The bank's focus on diversifying revenue streams and its ongoing success in attracting deposits in various verticals are positive signals for long-term investors.

Nevertheless, the heavy investment in growth and repositioning has short-term financial costs, as seen in the elevated noninterest expenses. Investors should be mindful of the balance between these upfront costs and the anticipated benefits. The payback period for the recent balance sheet restructuring is estimated at less than three years, which should be a critical timeframe for evaluating the success of these strategic moves.

Pinnacle Financial Partners' effective tax rate for the first half of 2024 is reported at 18.1%, influenced by several tax benefits. Excluding these adjustments, the effective rate would be approximately 19.6%, aligning with historical trends. From a retail investor's perspective, this stable tax rate is a favorable indicator, reflecting consistency in tax planning and predictability in net earnings.

Additionally, the increase in book value per common share and tangible book value during the quarter suggests effective capital management. These metrics, coupled with a rise in the common equity Tier one risk-based capital ratio from 10.4% to 10.7%, showcase the firm’s financial resilience despite incurring significant one-time losses. This should provide investors with confidence in the company's long-term capital soundness.

07/16/2024 - 06:03 PM

Excluding impacts of capital optimization and balance sheet repositioning initiatives, diluted EPS of $1.63

NASHVILLE, Tenn.--(BUSINESS WIRE)-- Pinnacle Financial Partners, Inc. (Nasdaq/NGS: PNFP) reported net income per diluted common share of $0.64 for the quarter ended June 30, 2024, compared to net income per diluted common share of $2.54 for the quarter ended June 30, 2023, a decrease of approximately 74.8 percent. Net income per diluted common share was $2.21 for the six months ended June 30, 2024, compared to $4.30 for the six months ended June 30, 2023, a decrease of approximately 48.6 percent.

After considering the adjustments noted in the table below, net income per diluted common share was $1.63 for the three months ended June 30, 2024, compared to $1.80 for the three months ended June 30, 2023, and $1.53 for the three months ended March 31, 2024, an annualized linked-quarter growth rate of 26.1 percent. Net income per diluted common share adjusted for the items noted in the table below was $3.16 for the six months ended June 30, 2024, compared to $3.55 for the six months ended June 30, 2023.

	Three months ended								Six months ended
	June 30, 2024		March 31, 2024			June 30, 2023			June 30, 2024			June 30, 2023
Diluted earnings per common share		0.64	$	1.57		$	2.54		$	2.21		$	4.30
Net of tax adjustments ⁽¹⁾:
Investment losses on sales of securities, net		0.71		—			0.10			0.71			0.10
Gain on sale of fixed assets as a result of sale-leaseback transaction		—		—			(0.84	)		—			(0.84	)
Recognition of mortgage servicing asset		—		(0.12	)		—			(0.12	)		—
ORE expense ⁽²⁾		—		—			—			—			—
FDIC special assessment		—		0.08			—			0.08			—
Fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives		0.28		—			—			0.28			—
Diluted earnings per common share after adjustments		1.63	$	1.53		$	1.80		$	3.16		$	3.55

⁽¹⁾: Adjustments include tax effect calculated using a marginal tax rate of 25.00 percent for all periods presented.

⁽²⁾: Impact of ORE expense in all periods presented were minimal.

"It appears to us that, in the second quarter, we saw the inflection we had anticipated,” said M. Terry Turner, Pinnacle's President and Chief Executive Officer. "Not only did we continue to have outsized balance sheet growth which we expect to exceed that of peers, but we also had net interest margin expansion and ongoing double-digit growth in most of our fee businesses. Total revenues were $366.6 million during the second quarter of 2024 compared to $428.1 million last quarter. Excluding the adjustments noted above, total revenues increased $22.3 million, or 5.3 percent, to $438.7 million for the second quarter compared to $416.3 million in the first quarter.

"Also, during the second quarter, we executed several initiatives with the objective of capital optimization and balance sheet repositioning that were both a priority for our firm going into 2024. We accomplished these objectives while increasing both our tangible common equity and tier 1 common equity ratios at the end of the second quarter and achieving an earnback period on the balance sheet repositioning of less than three years.

"I believe the various initiatives that have been undertaken in order to achieve sound growth, even in this more difficult operating environment, continue to differentiate our firm in terms of earnings trajectory. Our effort to increase our deposit base by expanding into various deposit verticals is progressing well, now reporting approximately $1.0 billion in net deposit growth in these verticals through the first half of 2024. Additionally, our strategic expansion into new markets and our ability to attract "best in class" revenue producers continue to fuel outsized growth. Loan growth attributable to these new markets for the first half of 2024 amounted to approximately 73 percent of our aggregate loan growth this year. Our latest expansion into Jacksonville is also advancing rapidly in terms of hiring revenue producers and moving client relationships, with that market reporting $20.1 million in loans, $28.8 million in deposits and $614.6 million in wealth management assets, all amassed within just the last three months. System-wide, our robust hiring continues, as we have added 89 new revenue producers thus far this year, 18 of which are in Jacksonville. Our hiring pipelines remain very robust heading into the second half of 2024.

"With the initiatives we accomplished in the second quarter, as well as our continued outlook for outsized loan and deposit growth, we enter the second half of 2024 with great optimism."

BALANCE SHEET GROWTH AND LIQUIDITY:

Total assets at June 30, 2024, were $49.4 billion, an increase of approximately $472.8 million from March 31, 2024, and $2.5 billion from June 30, 2023, reflecting a linked-quarter annualized increase of 3.9 percent and a year-over-year increase of 5.3 percent, respectively. A further analysis of select balance sheet trends follows:

	Balances at				Linked-Quarter Annualized % Change	Balances at		Year-over-Year % Change
(dollars in thousands)	June 30, 2024		March 31, 2024		Linked-Quarter Annualized % Change	June 30, 2023		Year-over-Year % Change
Loans	$	33,769,150		33,162,873	7.3%	$	31,153,290	8.4%
Securities		7,882,891		7,371,847	27.7%		6,623,457	19.0%
Other interest-earning assets		2,433,910		3,195,211	(95.3)%		4,001,844	(39.2)%
Total interest-earning assets	$	44,085,951	$	43,729,931	3.3%	$	41,778,591	5.5%

Core deposits:
Noninterest-bearing deposits	$	7,932,882	$	7,958,739	(1.3)%	$	8,436,799	(6.0)%
Interest-bearing core deposits⁽¹⁾		27,024,945		26,679,871	5.2%		24,343,968	11.0%
Noncore deposits and other funding⁽²⁾		7,569,703		7,506,409	3.4%		7,731,082	(2.1)%
Total funding	$	42,527,530	$	42,145,019	3.6%	$	40,511,849	5.0%

⁽¹⁾: Interest-bearing core deposits are interest-bearing deposits, money market accounts and time deposits less than $250,000 including reciprocating time and money market deposits.

⁽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.

During the second quarter of 2024, the commercial and industrial and owner-occupied commercial real estate loan portfolios grew linked-quarter annualized 14.6 percent and 17.0 percent, respectively, while the non-owner occupied commercial real estate portfolio, which consists primarily of commercial real estate investment, multifamily and construction and development loans decreased linked-quarter annualized by 2.6 percent. The firm continues to pursue reduced levels of commercial real estate loans by significantly limiting growth in these loan segments until certain benchmarks are achieved. At June 30, 2024, the firm’s non-owner occupied commercial real estate, multifamily and construction and development loans to total risk-based capital ratio fell to 254.0 percent while our construction and land development loans to total risk-based capital ratio decreased to 72.9 percent. Over time, the firm has targeted a non-owner occupied commercial real estate, multifamily and construction and land development loans to total risk-based capital ratio of less than 225 percent and construction and land development loans to total risk-based capital ratio of less than 70 percent.
Late in the second quarter of 2024, the firm executed various capital optimization and balance sheet repositioning initiatives intended to improve ongoing revenue and earnings run rates, as follows:

Reposition the firm’s securities portfolio with the goal of meaningfully enhancing its future performance - In doing so, the firm incurred losses in the second quarter related to the sale of approximately $894.8 million of available-for-sale securities at a net loss of $72.1 million and the termination of an agreement to resell for $500.0 million of securities that the firm had previously purchased (the resell agreement). The termination of the resell agreement required termination fees to be paid to the counterparty of approximately $27.6 million, which has been recognized in noninterest expense during the second quarter. The proceeds from the sale of the $894.8 million in available-for-sale securities and the $500.0 million resulting from the termination of the resell agreement have been reinvested such that the yield increase on the new securities acquired approximates 3.1 percent over the prior weighted average yields of the sold securities and the terminated resell agreement.
Offset the negative capital impact of the second quarter losses from the execution of the balance sheet repositioning initiatives - The firm executed a credit default swap arrangement (CDS) with a notional amount of $86.5 million with a counterparty which equals 5 percent of a reference pool of $1.73 billion of 1-4 family first lien mortgage loans whereby the counterparty will assume the first-loss position for these loans up to approximately $86.5 million in aggregate losses. The firm will pay to the counterparty an annual loss protection fee equal to 7.95 percent of the corresponding notional amount of the CDS, for as long as the loans in the reference pool remain outstanding. The notional amount of the CDS will decline over time as the loans in the reference portfolio are paid down, mature or the investor absorbs the first loss portion of any loan losses on those loans. Additionally, and in accordance with regulatory guidelines, the firm has implemented enhanced control processes with respect to certain other commercial loans which permits recharacterization of these loans in order to reduce the risk weights assigned to these loans. As a result, the loans subject to the CDS and the loans where risk ratings were able to be recharacterized now qualify for reduced risk weights pursuant to risk-based capital guidelines. The benefits of these reductions in risk weighting offset the impact to capital of the loss on the sale of the securities and the termination of the resell agreement. In order to accomplish the CDS and the recharacterization, the firm incurred $850,000 of professional fees during the second quarter which are also included in noninterest expense.
Minimize the payback period on the losses incurred in connection with the balance sheet restructuring transactions - The firm anticipates that the increased revenues from the repositioning of the firm’s investment securities portfolio, less the annual loss protection fees associated with the CDS, will offset the loss incurred on the sale of available-for-sale securities and the termination of the resell agreement within a three-year time period, which the firm believes to be a reasonable payback period.

"Despite moving quickly toward our previously announced lower targets for our construction and land development, non-owner occupied commercial real estate and multifamily portfolios as a percentage of risk-based capital, through the first six months of 2024, our loan growth approximated $1.1 billion, a 6.7 percent annualized rate of growth," Turner said. "We are optimistic that we should see increases in the pace of loan growth in the second half of 2024 as we believe we will continue to take market share from the larger franchises that currently dominate our newer markets.

"As to deposit growth, during the second quarter, total deposits were up approximately $368.4 million while brokered deposits decreased by $339.7 million during the quarter. Excluding these brokered deposits, total deposits were up $708.1 million in the quarter which was similar to our experience in the first quarter of 2024. Importantly, we are very pleased that our noninterest bearing deposit balances were relatively stable during the entirety of the second quarter."

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

Pre-tax, pre-provision net revenues (PPNR) for the three and six months ended June 30, 2024, were $95.2 million and $280.9 million, respectively, a decrease of 65.7 and 39.9 percent, respectively, from the $277.6 million and $467.6 million recognized in the three and six months ended June 30, 2023, respectively.

	Three months ended							Six months ended
	June 30,							June 30,
(dollars in thousands)	2024		2023			% change		2024			2023			% change
Revenues:
Net interest income	$	332,262	$	315,393		5.3	%	$	650,296		$	627,624		3.6	%
Noninterest income		34,288		173,839		(80.3	)%		144,391			263,368		(45.2	)%
Total revenues		366,550		489,232		(25.1	)%		794,687			890,992		(10.8	)%
Noninterest expense		271,389		211,641		28.2	%		513,754			423,368		21.3	%
Pre-tax, pre-provision net revenue (PPNR)		95,161		277,591		(65.7	)%		280,933			467,624		(39.9	)%
Adjustments:
Investment losses on sales of securities, net		72,103		9,961		>100%			72,103			9,961		>100%
Gain on the sale of fixed assets as a result of sale leaseback		—		(85,692	)	(100.0	)%		—			(85,692	)	(100.0	)%
Recognition of mortgage servicing asset		—		—		NA			(11,812	)		—		100.0	%
ORE expense		22		58		(62.1	)%		106			157		(32.5	)%
FDIC special assessment		—		—		NA			7,250			—		NA
Fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives		28,400		—		100.0	%		28,400			—		100.0	%
Adjusted PPNR	$	195,686	$	201,918		(3.1	)%	$	376,980		$	392,050		(3.8	)%

	Three months ended			Six months ended
	June 30, 2024	March 31, 2024	June 30, 2023	June 30, 2024	June 30, 2023
Net interest margin	3.14 %	3.04 %	3.20 %	3.09 %	3.30 %
Efficiency ratio	74.04 %	56.61 %	43.26 %	64.65 %	47.52 %
Return on average assets	0.41 %	1.00 %	1.71 %	0.70 %	1.49 %
Return on average tangible common equity (TCE)	4.90 %	12.11 %	21.06 %	8.48 %	18.33 %
Average loan to deposit ratio	84.95 %	84.73 %	84.94 %	84.84 %	84.47 %

Net interest income for the second quarter of 2024 was $332.3 million, compared to $318.0 million for the first quarter of 2024 and $315.4 million for the second quarter of 2023, a year-over-year growth rate of 5.3 percent. Net interest margin was 3.14 percent for the second quarter of 2024, compared to 3.04 percent for the first quarter of 2024 and 3.20 percent for the second quarter of 2023.

Noninterest income for the second quarter of 2024 was $34.3 million compared to $110.1 million for the first quarter of 2024 and $173.8 million for the second quarter of 2023.

	Three months ended					Linked-quarter Annualized % Change		Three months ended			Yr-over-Yr % Change
(dollars in thousands)	June 30, 2024		March 31, 2024			Linked-quarter Annualized % Change		June 30, 2023			Yr-over-Yr % Change
Noninterest income	$	34,288	$	110,103		>(100.0%)		$	173,839		(80.3	)%
Less:
Investment losses on sales of securities, net		72,103		—		100.0	%		9,961		>100%
Gain on the sale of fixed assets as a result of sale leaseback		—		—		—	%		(85,692	)	(100.0	)%
Recognition of mortgage servicing asset		—		(11,812	)	(100.0	)%		—		—	%
Adjusted noninterest income	$	106,391	$	98,291		33.0	%	$	98,108		8.4	%

Wealth management revenues, which include investment, trust and insurance services, were $27.8 million for the second quarter of 2024, compared to $26.0 million for the first quarter of 2024 and $24.1 million for the second quarter of 2023, a year-over-year increase of 15.4 percent. The increase in wealth management revenues was attributable to several factors, but primarily is the result of an increase in capacity with more revenue producers and the placement of those producers in the areas of the firm's most recent strategic market expansions.
During the second quarter of 2024, net gains from mortgage loans sold were $3.3 million, compared to $2.9 million in the first quarter of 2024 and $1.6 million in the second quarter of 2023. Similar to wealth management, the increase in mortgage fee income was primarily attributable to increases in capacity with more originators in Pinnacle's newer strategic market expansions.
Income from the firm's investment in Banker's Healthcare Group (BHG) was $18.7 million for the second quarter of 2024, compared to $16.0 million for the first quarter of 2024 and $26.9 million for the second quarter of 2023, a year-over-year decline of 30.6 percent.
- BHG's loan originations increased to $871 million in the second quarter of 2024, compared to $692 million in the first quarter of 2024 and $1.1 billion in the second quarter of 2023.
- Loans sold to BHG's community bank partners were approximately $467 million in the second quarter of 2024, compared to approximately $533 million in the first quarter of 2024 and $523 million in the second quarter of 2023.
- BHG reserves for on-balance sheet loan losses were $271 million, or 9.9 percent of loans held for investment at June 30, 2024, compared to 10.3 percent at March 31, 2024 and 6.0 percent at June 30, 2023. The year-over-year increase in reserves as a percentage of loans held for investment was impacted by BHG's adoption of lifetime credit losses associated with its implementation of the current expected credit loss (CECL) methodology on Oct. 1, 2023.
- BHG increased its accrual for estimated losses attributable to loan substitutions and prepayments to $415 million, or 5.9 percent of the unpaid loan balances that were previously purchased by BHG's community bank network, at June 30, 2024, compared to $391 million, or 5.7 percent, at March 31, 2024 and $369 million, or 5.9 percent, at June 30, 2023.
Other noninterest income was $41.8 million for the quarter ended June 30, 2024, a decline of $9.9 million between the second quarter of 2024 and the first quarter of 2024 and an increase of $8.4 million from the second quarter of 2023. Positively impacting other noninterest income in the first quarter of 2024 was approximately $11.8 million associated with the recognition of the Freddie Mac Small Business Lending mortgage servicing asset.

Noninterest expense for the second quarter of 2024 was $271.4 million compared to $242.4 million for the first quarter of 2024 and $211.6 million for the second quarter of 2023.

	Three months ended				Linked-quarter Annualized % Change		Three months ended		Yr-over-Yr % Change
(dollars in thousands)	June 30, 2024		March 31, 2024		Linked-quarter Annualized % Change		June 30, 2023		Yr-over-Yr % Change
Noninterest expense	$	271,389	$	242,365	47.9	%	$	211,641	28.2	%
Less:
ORE expense		22		84	NM			58	(62.1	)%
FDIC special assessment		—		7,250	(100.0	)%		—	—	%
Fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives		28,400		—	100.0	%		—	100.0	%
Adjusted noninterest expense	$	242,967	$	235,031	13.5	%	$	211,583	14.8	%

Salaries and employee benefits were $150.1 million in the second quarter of 2024, compared to $146.0 million in the first quarter of 2024 and $132.4 million in the second quarter of 2023, reflecting a year-over-year increase of 13.3 percent.
- Full-time equivalent associates increased to 3,469.0 at June 30, 2024 from 3,386.5 at March 31, 2024 and 3,309.0 at June 30, 2023, a year-over-year increase of 4.8 percent.
- Cash and equity incentive costs in the second quarter of 2024 were approximately $4.3 million higher than the first quarter of 2024 and $4.8 million higher than the amounts recorded in the second quarter of 2023.
Equipment and occupancy costs were $41.0 million in the second quarter of 2024, compared to $39.6 million in the first quarter of 2024, reflecting an increase of 3.5 percent, and $33.7 million in the second quarter of 2023, reflecting a year-over-year increase of 21.7 percent. Comparing the second quarter of 2024 to the second quarter of 2023, several factors contributed to the increase of equipment and occupancy costs, including new equipment and facilities, rent escalators on various properties and the previously disclosed sale-leaseback transaction executed in the second quarter of 2023.
Noninterest expense categories, other than those specifically noted above, were $80.2 million in the second quarter of 2024, compared to $56.7 million in the first quarter of 2024, reflecting an increase of 41.5 percent, and $45.5 million in the second quarter of 2023, reflecting a year-over-year increase of 76.4 percent. Primarily impacting the quarterly changes in other noninterest expense between the first and second quarters of 2024 was the impact of the $28.4 million in fees paid to terminate the resell agreement and professional fees incurred in connection with the capital optimization initiatives described elsewhere in this release.

"During the second quarter, while our net interest margin expanded to 3.14 percent, we anticipate continued margin expansion for the remainder of 2024," said Harold R. Carpenter, Pinnacle's Chief Financial Officer. "Second quarter net interest margin expansion was the direct result of an intense focus on obtaining appropriate pricing on new and renewing loans, stability of our noninterest bearing deposit balances, and our relationship managers working extremely hard to keep our deposit pricing well contained during the quarter.

"We are very excited about our core fee performance during the second quarter. Second quarter fee growth in nearly every core fee category, including, but not limited to service charges, wealth management and mortgage, exceeded double-digit growth in comparison to the second quarter of 2023. BHG also had another strong quarter as their contribution was up approximately $2.7 million from the first quarter. At this time, we are anticipating the quarterly run rate for BHG's contribution to be fairly consistent with their second quarter contribution for the remainder of 2024.

"Our expense results for the second quarter are generally consistent with where we thought we would be excluding the costs of the balance sheet restructuring and capital optimization initiatives. That said, we are seeing strong hiring across our franchise, particularly in our newer markets and, in most cases, more favorable results than we anticipated. Given our outlook for the remainder of the year, we are increasing our accrual for annual cash incentive plan payouts to approximately 85 percent of target level payouts as of the end of the second quarter."

CAPITAL, SOUNDNESS AND TAXES:

	As of
	June 30, 2024			December 31, 2023			June 30, 2023
Shareholders' equity to total assets		12.5	%		12.6	%		12.5	%
Tangible common equity to tangible assets		8.6	%		8.6	%		8.3	%
Book value per common share	$	77.15		$	75.80		$	73.32
Tangible book value per common share	$	52.92		$	51.38		$	48.85
Annualized net loan charge-offs to avg. loans ⁽¹⁾		0.27	%		0.17	%		0.13	%
Nonperforming assets to total loans, ORE and other nonperforming assets (NPAs)		0.30	%		0.27	%		0.15	%
Classified asset ratio (Pinnacle Bank) ⁽²⁾		3.99	%		5.22	%		3.32	%
Construction and land development loans as a percentage of total capital ⁽³⁾		72.90	%		84.20	%		84.50	%
Construction and land development, non-owner occupied commercial real estate and multi-family loans as a percentage of total capital ⁽³⁾		254.00	%		259.00	%		256.70	%
Allowance for credit losses (ACL) to total loans		1.13	%		1.08	%		1.08	%

⁽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.

^(3): Calculated using the same guidelines as are used in the Federal Financial Institutions Examination Council's Uniform Bank Performance Report.

"Net charge-offs to average loans for the second quarter of 2024 were 0.27 percent, compared to 0.20 percent in the prior quarter," Carpenter said. "Net charge-offs increased in the second quarter primarily due to the continued deterioration of the value of the underlying collateral of an owner-occupied commercial real estate loan. In light of these matters, our special assets officers determined it was time to exit the borrower. This resulted in a charge-off of $10.3 million which was recognized in the second quarter. Most of our other key asset quality metrics continue to be better than longer-term historical levels as we experienced a decrease in nonperforming loans in relation to total loans at June 30, 2024 and experienced overall improvement in past dues, classified assets and potential problem loans ratios.

"Our effective tax rate for the first six months of 2024 was 18.1 percent. Excluding adjustments noted above and other tax benefits, the effective tax rate would have approximated 19.6 percent for the first six months of 2024, which is consistent with our historical run rates.

"Also, we are reporting an increase in book value per common share during the quarter from $76.23 to $77.15, an annualized linked-quarter increase of 4.8 percent and an increase in tangible book value per common share from $51.98 at March 31, 2024 to $52.92 at June 30, 2024, an annualized linked-quarter increase of 7.2 percent. Additionally, even after considering the securities losses, termination fees associated with terminating the resell agreement and transaction expenses associated with the capital optimization initiatives, the firm's common equity Tier one risk-based capital ratio increased from 10.4 percent at March 31, 2024 to 10.7 percent at June 30, 2024 which we also consider a great accomplishment."

BOARD OF DIRECTORS DECLARES DIVIDENDS

On July 16, 2024, Pinnacle Financial's Board of Directors approved a quarterly cash dividend of $0.22 per common share to be paid on Aug. 30, 2024 to common shareholders of record as of the close of business on Aug. 2, 2024. Additionally, the Board of Directors approved a quarterly cash dividend of approximately $3.8 million, or $16.88 per share (or $0.422 per depositary share), on Pinnacle Financial's 6.75 percent Series B Non-Cumulative Perpetual Preferred Stock payable on Sept. 1, 2024 to shareholders of record at the close of business on Aug. 17, 2024. The amount and timing of any future dividend payments to both preferred and common shareholders will be subject to the approval of Pinnacle's Board of Directors.

WEBCAST AND CONFERENCE CALL INFORMATION

Pinnacle will host a webcast and conference call at 8:30 a.m. CDT on July 17, 2024, to discuss second quarter 2024 results and other matters. To access the call for audio only, please call 1-877-209-7255. For the presentation and streaming audio, please access the webcast on the investor relations page of Pinnacle's website at www.pnfp.com.

For those unable to participate in the webcast, it will be archived on the investor relations page of Pinnacle's website at www.pnfp.com for 90 days following the presentation.

Pinnacle Financial Partners provides a full range of banking, investment, trust, mortgage and insurance products and services designed for businesses and their owners and individuals interested in a comprehensive relationship with their financial institution. The firm is the No. 1 and fastest growing bank in the Nashville-Murfreesboro-Franklin MSA, according to June 30, 2023 deposit data from the FDIC. Pinnacle is No. 11 on the 2024 list of 100 Best Companies to Work For® in the U.S., its eighth consecutive appearance and was recognized by American Banker as one of America's Best Banks to Work For 11 years in a row and No. 1 among banks with more than $10 billion in assets in 2023.

Pinnacle Bank 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 $49.4 billion in assets as of June 30, 2024. As the second-largest bank holding company in Tennessee, Pinnacle operates in several 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.

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 persistent elevated interest rates, the negative impact of inflationary pressures and challenging economic conditions on our and BHG's customers and their businesses, resulting in significant increases in loan losses and provisions for those losses and, in the case of BHG, substitutions; (ii) fluctuations or differences in interest rates on loans or deposits from those that Pinnacle Financial is modeling or anticipating, including as a result of Pinnacle Bank's inability to better match deposit rates with the changes in the short-term rate environment, or that affect the yield curve; (iii) the sale of investment securities in a loss position before their value recovers, including as a result of asset liability management strategies or in response to liquidity needs; (iv) adverse conditions in the national or local economies including in Pinnacle Financial's markets throughout the Southeast region of the United States, particularly in commercial and residential real estate markets; (v) the inability of Pinnacle Financial, or entities in which it has significant investments, like BHG, to maintain the long-term historical growth rate of its, or such entities', loan portfolio; (vi) the ability to grow and retain low-cost core deposits and retain large, uninsured deposits, including during times when Pinnacle Bank is seeking to limit the rates it pays on deposits or uncertainty exists in the financial services sector; (vii) changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments; (viii) effectiveness of Pinnacle Financial's asset management activities in improving, resolving or liquidating lower-quality assets; (ix) the impact of competition with other financial institutions, including pricing pressures and the resulting impact on Pinnacle Financial’s results, including as a result of the negative impact to net interest margin from rising deposit and other funding costs; (x) the results of regulatory examinations of Pinnacle Financial, Pinnacle Bank or BHG, or companies with whom they do business; (xi) BHG's ability to profitably grow its business and successfully execute on its business plans; (xii) risks of expansion into new geographic or product markets; (xiii) any matter that would cause Pinnacle Financial to conclude that there was impairment of any asset, including goodwill or other intangible assets; (xiv) the ineffectiveness of Pinnacle Bank's hedging strategies, or the unexpected counterparty failure or hedge failure of the underlying hedges; (xv) 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; (xvi) deterioration in the valuation of other real estate owned and increased expenses associated therewith; (xvii) inability to comply with regulatory capital requirements, including those resulting from changes to capital calculation methodologies, required capital maintenance levels or regulatory requests or directives, particularly if Pinnacle Bank's level of applicable commercial real estate loans were to exceed percentage levels of total capital in guidelines recommended by its regulators; (xviii) approval of the declaration of any dividend by Pinnacle Financial's board of directors; (xix) 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; (xx) 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; (xxi) Pinnacle Financial's ability to identify potential candidates for, consummate, and achieve synergies from, potential future acquisitions; (xxii) difficulties and delays in integrating acquired businesses or fully realizing costs savings and other benefits from acquisitions; (xxiii) the risks associated with Pinnacle Bank being a minority investor in BHG, including the risk that the owners of a majority of the equity interests in BHG decide to sell the company or all or a portion of their ownership interests in BHG (triggering a similar sale by Pinnacle Bank); (xxiv) changes in state and federal legislation, regulations or policies applicable to banks and other financial service providers, like BHG, including regulatory or legislative developments; (xxv) fluctuations in the valuations of Pinnacle Financial's equity investments and the ultimate success of such investments; (xxvi) the availability of and access to capital; (xxvii) adverse results (including costs, fines, reputational harm, inability to obtain necessary approvals and/or other negative effects) from current or future litigation, regulatory examinations or other legal and/or regulatory actions involving Pinnacle Financial, Pinnacle Bank or BHG; and (xxviii) general competitive, economic, political and market conditions. Additional factors which could affect the forward looking statements can be found in Pinnacle Financial's Annual Report on Form 10-K for the year ended December 31, 2023, and subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the SEC and available on the SEC's website at http://www.sec.gov. Pinnacle Financial disclaims any obligation to update or revise any forward-looking statements contained in this press release, which speak only as of the date hereof, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Matters

This release contains certain non-GAAP financial measures, including, without limitation, total revenues, net income to common shareholders, earnings per diluted common share, revenue per diluted common share, PPNR, efficiency ratio, noninterest expense, noninterest income and the ratio of noninterest expense to average assets, excluding in certain instances the impact of expenses related to other real estate owned, gains or losses on sale of investment securities, gains associated with the sale-leaseback transaction completed in the second quarter of 2023, losses on the restructuring of certain bank owned life insurance (BOLI) contracts, charges related to the FDIC special assessment, income associated with the recognition of a mortgage servicing asset in the first quarter of 2024, fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives in the second quarter of 2024 and other matters for the accounting periods presented. 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 2024 versus certain periods in 2023 and to internally prepared projections.

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS – UNAUDITED

*(dollars in thousands, except for share and per share data)*	June 30, 2024			December 31, 2023			June 30, 2023
*ASSETS*
Cash and noninterest-bearing due from banks	$	219,110		$	228,620		$	447,216
Restricted cash		50,924			86,873			22,567
Interest-bearing due from banks		2,107,883			1,914,856			3,363,348
Cash and cash equivalents		2,377,917			2,230,349			3,833,131
Securities purchased with agreement to resell		71,903			558,009			507,235
Securities available-for-sale, at fair value		4,908,967			4,317,530			3,591,280
Securities held-to-maturity (fair value of $2.7 billion, $2.8 billion, and $2.7 billion, net of allowance for credit losses of $1.7 million, $1.7 million, and $1.7 million at June 30, 2024, Dec. 31, 2023, and June 30, 2023, respectively)		2,973,924			3,006,357			3,032,177
Consumer loans held-for-sale		187,154			104,217			85,981
Commercial loans held-for-sale		16,046			9,280			22,713
Loans		33,769,150			32,676,091			31,153,290
Less allowance for credit losses		(381,601	)		(353,055	)		(337,459	)
Loans, net		33,387,549			32,323,036			30,815,831
Premises and equipment, net		282,775			256,877			244,853
Equity method investment		433,073			445,223			461,596
Accrued interest receivable		220,232			217,491			164,854
Goodwill		1,846,973			1,846,973			1,846,973
Core deposits and other intangible assets		24,313			27,465			30,981
Other real estate owned		2,636			3,937			2,555
Other assets		2,633,507			2,613,139			2,235,822
Total assets	$	49,366,969		$	47,959,883		$	46,875,982
*LIABILITIES AND SHAREHOLDERS' EQUITY*
Deposits:
Noninterest-bearing	$	7,932,882		$	7,906,502		$	8,436,799
Interest-bearing		12,600,723			11,365,349			10,433,361
Savings and money market accounts		14,437,407			14,427,206			13,645,849
Time		4,799,368			4,840,753			5,206,652
Total deposits		39,770,380			38,539,810			37,722,661
Securities sold under agreements to repurchase		220,885			209,489			163,774
Federal Home Loan Bank advances		2,110,885			2,138,169			2,200,917
Subordinated debt and other borrowings		425,380			424,938			424,497
Accrued interest payable		58,881			66,967			53,854
Other liabilities		605,890			544,722			466,520
Total liabilities		43,192,301			41,924,095			41,032,223
Preferred stock, no par value, 10.0 million shares authorized; 225,000 shares non-cumulative perpetual preferred stock, Series B, liquidation preference $225.0 million, issued and outstanding at June 30, 2024, Dec. 31, 2023, and June 30, 2023, respectively		217,126			217,126			217,126
Common stock, par value $1.00; 180.0 million shares authorized; 77.2 million, 76.8 million and 76.7 million shares issued and outstanding at June 30, 2024, Dec. 31, 2023, and June 30, 2023, respectively		77,217			76,767			76,740
Additional paid-in capital		3,110,993			3,109,493			3,087,967
Retained earnings		2,919,923			2,784,927			2,634,315
Accumulated other comprehensive loss, net of taxes		(150,591	)		(152,525	)		(172,389	)
Total shareholders' equity		6,174,668			6,035,788			5,843,759
Total liabilities and shareholders' equity	$	49,366,969		$	47,959,883		$	46,875,982
This information is preliminary and based on company data available at the time of the presentation.

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME – UNAUDITED
*(dollars in thousands, except for share and per share data)*	Three months ended									Six months ended
	June 30, 2024			March 31, 2024			June 30, 2023			June 30, 2024			June 30, 2023
Interest income:
Loans, including fees	$	551,659		$	541,199		$	478,896		$	1,092,858		$	910,798
Securities
Taxable		51,578			44,470			31,967			96,048			61,325
Tax-exempt		24,372			24,600			24,603			48,972			48,405
Federal funds sold and other		40,781			40,214			39,773			80,995			60,750
Total interest income		668,390			650,483			575,239			1,318,873			1,081,278
Interest expense:
Deposits		304,449			300,968			228,668			605,417			405,257
Securities sold under agreements to repurchase		1,316			1,399			783			2,715			1,378
FHLB advances and other borrowings		30,363			30,082			30,395			60,445			47,019
Total interest expense		336,128			332,449			259,846			668,577			453,654
Net interest income		332,262			318,034			315,393			650,296			627,624
Provision for credit losses		30,159			34,497			31,689			64,656			50,456
Net interest income after provision for credit losses		302,103			283,537			283,704			585,640			577,168
Noninterest income:
Service charges on deposit accounts		14,563			13,439			12,180			28,002			23,898
Investment services		15,720			14,751			14,174			30,471			25,769
Insurance sales commissions		3,715			3,852			3,252			7,567			7,716
Gains on mortgage loans sold, net		3,270			2,879			1,567			6,149			3,620
Investment losses on sales, net		(72,103	)		—			(9,961	)		(72,103	)		(9,961	)
Trust fees		8,323			7,415			6,627			15,738			13,056
Income from equity method investment		18,688			16,035			26,924			34,723			46,003
Gain on sale of fixed assets		325			58			85,724			383			85,859
Other noninterest income		41,787			51,674			33,352			93,461			67,408
Total noninterest income		34,288			110,103			173,839			144,391			263,368
Noninterest expense:
Salaries and employee benefits		150,117			146,010			132,443			296,127			268,151
Equipment and occupancy		41,036			39,646			33,706			80,682			64,059
Other real estate, net		22			84			58			106			157
Marketing and other business development		6,776			6,125			5,664			12,901			11,606
Postage and supplies		3,135			2,771			2,863			5,906			5,682
Amortization of intangibles		1,568			1,584			1,780			3,152			3,574
Other noninterest expense		68,735			46,145			35,127			114,880			70,139
Total noninterest expense		271,389			242,365			211,641			513,754			423,368
Income before income taxes		65,002			151,275			245,902			216,277			417,168
Income tax expense		11,840			27,331			48,603			39,171			82,598
Net income		53,162			123,944			197,299			177,106			334,570
Preferred stock dividends		(3,798	)		(3,798	)		(3,798	)		(7,596	)		(7,596	)
Net income available to common shareholders	$	49,364		$	120,146		$	193,501		$	169,510		$	326,974
*Per share information:*
Basic net income per common share	$	0.65		$	1.58		$	2.55		$	2.22		$	4.30
Diluted net income per common share	$	0.64		$	1.57		$	2.54		$	2.21		$	4.30
Weighted average common shares outstanding:
Basic		76,506,121			76,278,453			76,030,081			76,392,287			75,975,982
Diluted		76,644,227			76,428,885			76,090,321			76,531,419			76,061,883
This information is preliminary and based on company data available at the time of the presentation.

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

(dollars and shares in thousands)	Preferred Stock Amount		Common Stock					Additional Paid-in Capital			Retained Earnings			Accumulated Other Comp. Income (Loss), net			Total Shareholders' Equity
	Preferred Stock Amount		Shares		Amounts			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comp. Income (Loss), net			Total Shareholders' Equity
Balance at December 31, 2022	$	217,126	76,454		$	76,454		$	3,074,867		$	2,341,706		$	(190,761	)	$	5,519,392
Exercise of employee common stock options & related tax benefits		—	40			40			931			—			—			971
Preferred dividends paid ($33.76 per share)		—	—			—			—			(7,596	)		—			(7,596	)
Common dividends paid ($0.44 per share)		—	—			—			—			(34,365	)					(34,365	)
Issuance of restricted common shares, net of forfeitures		—	200			200			(200	)		—			—			—
Restricted shares withheld for taxes & related tax benefits		—	(47	)		(47	)		(3,345	)		—			—			(3,392	)
Issuance of common stock pursuant to restricted stock unit (RSU) and performance stock unit (PSU) agreements, net of shares withheld for taxes & related tax benefits		—	93			93			(3,738	)		—			—			(3,645	)
Compensation expense for restricted shares & performance stock units		—	—			—			19,452			—			—			19,452
Net income		—	—			—			—			334,570			—			334,570
Other comprehensive gain		—	—			—			—			—			18,372			18,372
Balance at June 30, 2023	$	217,126	76,740		$	76,740		$	3,087,967		$	2,634,315		$	(172,389	)	$	5,843,759

Balance at December 31, 2023	$	217,126	76,767		$	76,767		$	3,109,493		$	2,784,927		$	(152,525	)	$	6,035,788
Preferred dividends paid ($33.76 per share)		—	—			—			—			(7,596	)		—			(7,596	)
Common dividends paid ($0.44 per share)		—	—			—			—			(34,514	)		—			(34,514	)
Issuance of restricted common shares, net of forfeitures		—	194			194			(194	)		—			—			—
Restricted shares withheld for taxes & related tax benefits		—	(55	)		(55	)		(4,529	)		—			—			(4,584	)
Issuance of common stock pursuant to RSU and PSU agreements, net of shares withheld for taxes & related tax benefits		—	311			311			(14,739	)		—			—			(14,428	)
Compensation expense for restricted shares & performance stock units		—	—			—			20,962			—			—			20,962
Net income		—	—			—			—			177,106			—			177,106
Other comprehensive gain		—	—			—			—			—			1,934			1,934
Balance at June 30, 2024	$	217,126	77,217		$	77,217		$	3,110,993		$	2,919,923		$	(150,591	)	$	6,174,668

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED

*(dollars in thousands)*	June			March		December		September		June		March
*(dollars in thousands)*	2024			2024		2023		2023		2023		2023
Balance sheet data, at quarter end:
Commercial and industrial loans	$	12,328,622		11,893,198		11,666,691		11,307,611		10,983,911		10,723,327
Commercial real estate - owner occupied loans		4,217,351		4,044,973		4,044,896		3,944,616		3,845,359		3,686,796
Commercial real estate - investment loans		5,998,326		6,138,711		5,929,595		5,957,426		5,682,652		5,556,484
Commercial real estate - multifamily and other loans		2,185,858		1,924,931		1,605,899		1,490,184		1,488,236		1,331,249
Consumer real estate - mortgage loans		4,874,846		4,828,416		4,851,531		4,768,780		4,692,673		4,531,285
Construction and land development loans		3,621,563		3,818,334		4,041,081		3,942,143		3,904,774		3,909,024
Consumer and other loans		542,584		514,310		536,398		532,524		555,685		559,706
Total loans		33,769,150		33,162,873		32,676,091		31,943,284		31,153,290		30,297,871
Allowance for credit losses		(381,601	)	(371,337	)	(353,055	)	(346,192	)	(337,459	)	(313,841	)
Securities		7,882,891		7,371,847		7,323,887		6,882,276		6,623,457		6,878,831
Total assets		49,366,969		48,894,196		47,959,883		47,523,790		46,875,982		45,119,587
Noninterest-bearing deposits		7,932,882		7,958,739		7,906,502		8,324,325		8,436,799		9,018,439
Total deposits		39,770,380		39,402,025		38,539,810		38,295,809		37,722,661		36,178,553
Securities sold under agreements to repurchase		220,885		201,418		209,489		195,999		163,774		149,777
FHLB advances		2,110,885		2,116,417		2,138,169		2,110,598		2,200,917		2,166,508
Subordinated debt and other borrowings		425,380		425,159		424,938		424,718		424,497		424,276
Total shareholders' equity		6,174,668		6,103,851		6,035,788		5,837,641		5,843,759		5,684,128
Balance sheet data, quarterly averages:
Total loans	$	33,516,804		33,041,954		32,371,506		31,529,854		30,882,205		29,633,640
Securities		7,322,588		7,307,201		6,967,488		6,801,285		6,722,247		6,765,126
Federal funds sold and other		3,268,307		3,274,062		3,615,908		4,292,956		3,350,705		2,100,757
Total earning assets		44,107,699		43,623,217		42,954,902		42,624,095		40,955,157		38,499,523
Total assets		48,754,091		48,311,260		47,668,519		47,266,199		45,411,961		42,983,854
Noninterest-bearing deposits		8,000,159		7,962,217		8,342,572		8,515,733		8,599,781		9,332,317
Total deposits		39,453,828		38,995,709		38,515,560		38,078,665		36,355,859		35,291,775
Securities sold under agreements to repurchase		213,252		210,888		202,601		184,681		162,429		219,082
FHLB advances		2,106,786		2,214,489		2,112,809		2,132,638		2,352,045		1,130,356
Subordinated debt and other borrowings		427,256		428,281		426,999		426,855		426,712		426,564
Total shareholders' equity		6,138,722		6,082,616		5,889,075		5,898,196		5,782,239		5,605,604
Statement of operations data, for the three months ended:
Interest income	$	668,390		650,483		644,796		627,294		575,239		506,039
Interest expense		336,128		332,449		327,544		310,052		259,846		193,808
Net interest income		332,262		318,034		317,252		317,242		315,393		312,231
Provision for credit losses		30,159		34,497		16,314		26,826		31,689		18,767
Net interest income after provision for credit losses		302,103		283,537		300,938		290,416		283,704		293,464
Noninterest income		34,288		110,103		79,088		90,797		173,839		89,529
Noninterest expense		271,389		242,365		251,168		213,233		211,641		211,727
Income before income taxes		65,002		151,275		128,858		167,980		245,902		171,266
Income tax expense		11,840		27,331		33,879		35,377		48,603		33,995
Net income		53,162		123,944		94,979		132,603		197,299		137,271
Preferred stock dividends		(3,798	)	(3,798	)	(3,798	)	(3,798	)	(3,798	)	(3,798	)
Net income available to common shareholders	$	49,364		120,146		91,181		128,805		193,501		133,473
Profitability and other ratios:
Return on avg. assets ⁽¹⁾		0.41	%	1.00	%	0.76	%	1.08	%	1.71	%	1.26	%
Return on avg. equity ⁽¹⁾		3.23	%	7.94	%	6.14	%	8.66	%	13.42	%	9.66	%
Return on avg. common equity⁽¹⁾		3.35	%	8.24	%	6.38	%	9.00	%	13.95	%	10.05	%
Return on avg. tangible common equity ⁽¹⁾		4.90	%	12.11	%	9.53	%	13.43	%	21.06	%	15.43	%
Common stock dividend payout ratio ⁽¹⁴⁾		17.29	%	12.59	%	12.26	%	11.35	%	11.04	%	12.07	%
Net interest margin⁽²⁾		3.14	%	3.04	%	3.06	%	3.06	%	3.20	%	3.40	%
Noninterest income to total revenue ⁽³⁾		9.35	%	25.72	%	19.95	%	22.25	%	35.53	%	22.28	%
Noninterest income to avg. assets ⁽¹⁾		0.28	%	0.92	%	0.66	%	0.76	%	1.54	%	0.84	%
Noninterest exp. to avg. assets ⁽¹⁾		2.24	%	2.02	%	2.09	%	1.79	%	1.87	%	2.00	%
Efficiency ratio ⁽⁴⁾		74.04	%	56.61	%	63.37	%	52.26	%	43.26	%	52.70	%
Avg. loans to avg. deposits		84.95	%	84.73	%	84.05	%	82.80	%	84.94	%	83.97	%
Securities to total assets		15.97	%	15.08	%	15.27	%	14.48	%	14.13	%	15.25	%
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)	*June 30, 2024*						*June 30, 2023*
	*Average Balances*		*Interest*		*Rates/ Yields*		*Average Balances*		*Interest*		*Rates/ Yields*
*Interest-earning assets*
Loans^{(1) (2)}	$	33,516,804	$	551,659	6.71	%	$	30,882,205	$	478,896	6.30	%
Securities
Taxable		4,085,859		51,578	5.08	%		3,394,507		31,967	3.78	%
Tax-exempt ⁽²⁾		3,236,729		24,372	3.61	%		3,327,740		24,603	3.54	%
Interest-bearing due from banks		2,541,394		33,607	5.32	%		2,597,020		33,234	5.13	%
Resell agreements		476,435		3,641	3.07	%		509,694		3,374	2.65	%
Federal funds sold		—		—	—	%		—		—	—	%
Other		250,478		3,533	5.67	%		243,991		3,165	5.20	%
Total interest-earning assets		44,107,699	$	668,390	6.20	%		40,955,157	$	575,239	5.74	%
*Nonearning assets*
Intangible assets		1,872,282						1,879,108
Other nonearning assets		2,774,110						2,577,696
Total assets	$	48,754,091					$	45,411,961

*Interest-bearing liabilities*
Interest-bearing deposits:
Interest checking		12,118,160		118,785	3.94	%		9,361,316		75,815	3.25	%
Savings and money market		14,659,713		134,399	3.69	%		13,684,536		110,024	3.22	%
Time		4,675,796		51,265	4.41	%		4,710,226		42,829	3.65	%
Total interest-bearing deposits		31,453,669		304,449	3.89	%		27,756,078		228,668	3.30	%
Securities sold under agreements to repurchase		213,252		1,316	2.48	%		162,429		783	1.93	%
Federal Home Loan Bank advances		2,106,786		24,395	4.66	%		2,352,045		24,603	4.20	%
Subordinated debt and other borrowings		427,256		5,968	5.62	%		426,712		5,792	5.44	%
Total interest-bearing liabilities		34,200,963		336,128	3.95	%		30,697,264		259,846	3.40	%
*Noninterest-bearing deposits*		8,000,159		—	—			8,599,781		—	—
Total deposits and interest-bearing liabilities		42,201,122	$	336,128	3.20	%		39,297,045	$	259,846	2.65	%
Other liabilities		414,247						332,677
*Shareholders' equity*		6,138,722						5,782,239
Total liabilities and shareholders' equity	$	48,754,091					$	45,411,961
*Net* *interest* *income*			$	332,262					$	315,393
Net interest spread ⁽³⁾					2.25	%					2.35	%
Net interest margin ⁽⁴⁾					3.14	%					3.20	%

(1) Average balances of nonperforming loans are included in the above amounts.
(2) Yields computed on tax-exempt instruments on a tax equivalent basis and included $11.9 million of taxable equivalent income for the three months ended June 30, 2024 compared to $11.2 million for the three months ended June 30, 2023. The tax-exempt benefit has been reduced by the projected impact of tax-exempt income that will be disallowed pursuant to IRS Regulations as of and for the then current period presented.
(3) Yields realized on interest-bearing assets less the rates paid on interest-bearing liabilities. The net interest spread calculation excludes the impact of demand deposits. Had the impact of demand deposits been included, the net interest spread for the three months ended June 30, 2024 would have been 3.00% compared to a net interest spread of 3.09% for the three months ended June 30, 2023.
(4) Net interest margin is the result of annualized net interest income calculated on a tax equivalent basis divided by average interest-earning assets for the period.

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

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
ANALYSIS OF INTEREST INCOME AND EXPENSE, RATES AND YIELDS-UNAUDITED

(dollars in thousands)	*Six months ended*						*Six months ended*
(dollars in thousands)	*June 30, 2024*						*June 30, 2023*
	*Average Balances*		*Interest*		*Rates/ Yields*		*Average Balances*		*Interest*		*Rates/ Yields*
*Interest-earning assets*
Loans^{(1) (2)}	$	33,279,379	$	1,092,858	6.69	%	$	30,261,372	$	910,798	6.15	%
Securities
Taxable		4,002,696		96,048	4.83	%		3,451,410		61,325	3.58	%
Tax-exempt ⁽²⁾		3,312,198		48,972	3.54	%		3,292,158		48,405	3.54	%
Interest-bearing due from banks		2,509,097		66,359	5.32	%		1,998,083		49,166	4.96	%
Resell agreements		510,111		7,499	2.96	%		511,169		6,703	2.64	%
Federal funds sold		—		—	—	%		—		—	—	%
Other		251,976		7,137	5.70	%		219,932		4,881	4.48	%
Total interest-earning assets		43,865,457	$	1,318,873	6.15	%		39,734,124	$	1,081,278	5.60	%
*Nonearning assets*
Intangible assets		1,873,076						1,879,994
Other nonearning assets		2,794,141						2,590,548
Total assets	$	48,532,674					$	44,204,666

*Interest-bearing liabilities*
Interest-bearing deposits:
Interest checking		11,842,966		231,513	3.93	%		8,581,899		128,289	3.01	%
Savings and money market		14,634,200		269,151	3.70	%		14,029,351		207,543	2.98	%
Time		4,766,414		104,753	4.42	%		4,251,481		69,425	3.29	%
Total interest-bearing deposits		31,243,580		605,417	3.90	%		26,862,731		405,257	3.04	%
Securities sold under agreements to repurchase		212,070		2,715	2.57	%		190,599		1,378	1.46	%
Federal Home Loan Bank advances		2,160,637		48,515	4.52	%		1,744,575		35,574	4.11	%
Subordinated debt and other borrowings		427,768		11,930	5.61	%		426,638		11,445	5.41	%
Total interest-bearing liabilities		34,044,055		668,577	3.95	%		29,224,543		453,654	3.13	%
*Noninterest-bearing deposits*		7,981,188		—	—			8,964,026		—	—
Total deposits and interest-bearing liabilities		42,025,243	$	668,577	3.20	%		38,188,569	$	453,654	2.40	%
Other liabilities		396,762						321,637
*Shareholders' equity*		6,110,669						5,694,460
Total liabilities and shareholders' equity	$	48,532,674					$	44,204,666
*Net* *interest* *income*			$	650,296					$	627,624
Net interest spread ⁽³⁾					2.21	%					2.47	%
Net interest margin ⁽⁴⁾					3.09	%					3.30	%

(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 $23.7 million of taxable equivalent income for the six months ended June 30, 2024 compared to $22.1 million for the six months ended June 30, 2023. The tax-exempt benefit has been reduced by the projected impact of tax-exempt income that will be disallowed pursuant to IRS Regulations as of and for the then current period presented.
(3) Yields realized on interest-bearing assets less the rates paid on interest-bearing liabilities. The net interest spread calculation excludes the impact of demand deposits. Had the impact of demand deposits been included, the net interest spread for the six months ended June 30, 2024 would have been 2.96% compared to a net interest spread of 3.20% for the six months ended June 30, 2023.
(4) Net interest margin is the result of annualized net interest income calculated on a tax equivalent basis divided by average interest-earning assets for the period.

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

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED

*(dollars in thousands)*	June			March		December		September		June		March
*(dollars in thousands)*	2024			2024		2023		2023		2023		2023
Asset quality information and ratios:
Nonperforming assets:
Nonaccrual loans	$	97,649		108,325		82,288		42,950		44,289		36,988
ORE and other nonperforming assets (NPAs)		2,760		2,766		4,347		3,019		3,105		7,802
Total nonperforming assets	$	100,409		111,091		86,635		45,969		47,394		44,790
Past due loans over 90 days and still accruing interest	$	4,057		5,273		6,004		4,969		5,257		5,284
Accruing purchase credit deteriorated loans	$	6,021		6,222		6,501		7,010		7,415		7,684
Net loan charge-offs	$	22,895		16,215		13,451		18,093		9,771		7,291
Allowance for credit losses to nonaccrual loans		390.8	%	342.8	%	429.0	%	806.0	%	762.0	%	848.5	%
As a percentage of total loans:
Past due accruing loans over 30 days		0.16	%	0.17	%	0.23	%	0.16	%	0.14	%	0.14	%
Potential problem loans		0.18	%	0.28	%	0.39	%	0.42	%	0.32	%	0.22	%
Allowance for credit losses		1.13	%	1.12	%	1.08	%	1.08	%	1.08	%	1.04	%
Nonperforming assets to total loans, ORE and other NPAs		0.30	%	0.33	%	0.27	%	0.14	%	0.15	%	0.15	%
Classified asset ratio (Pinnacle Bank) ⁽⁶⁾		4.0	%	4.9	%	5.2	%	4.6	%	3.3	%	2.7	%
Annualized net loan charge-offs to avg. loans ⁽⁵⁾		0.27	%	0.20	%	0.17	%	0.23	%	0.13	%	0.10	%

Interest rates and yields:
Loans		6.71	%	6.67	%	6.62	%	6.50	%	6.30	%	6.00	%
Securities		4.43	%	4.06	%	4.12	%	3.81	%	3.66	%	3.47	%
Total earning assets		6.20	%	6.11	%	6.09	%	5.95	%	5.74	%	5.45	%
Total deposits, including non-interest bearing		3.10	%	3.10	%	3.07	%	2.92	%	2.52	%	2.03	%
Securities sold under agreements to repurchase		2.48	%	2.67	%	2.54	%	2.30	%	1.93	%	1.10	%
FHLB advances		4.66	%	4.38	%	4.26	%	4.22	%	4.20	%	3.94	%
Subordinated debt and other borrowings		5.62	%	5.60	%	5.59	%	5.54	%	5.44	%	5.38	%
Total deposits and interest-bearing liabilities		3.20	%	3.20	%	3.15	%	3.01	%	2.65	%	2.12	%

Capital and other ratios ⁽⁶⁾:
Pinnacle Financial ratios:
Shareholders' equity to total assets		12.5	%	12.5	%	12.6	%	12.3	%	12.5	%	12.6	%
Common equity Tier one		10.7	%	10.4	%	10.3	%	10.3	%	10.2	%	9.9	%
Tier one risk-based		11.2	%	10.9	%	10.8	%	10.9	%	10.8	%	10.5	%
Total risk-based		13.2	%	12.9	%	12.7	%	12.8	%	12.7	%	12.4	%
Leverage		9.5	%	9.5	%	9.4	%	9.4	%	9.5	%	9.6	%
Tangible common equity to tangible assets		8.6	%	8.5	%	8.6	%	8.2	%	8.3	%	8.3	%
Pinnacle Bank ratios:
Common equity Tier one		11.5	%	11.3	%	11.1	%	11.2	%	11.1	%	10.8	%
Tier one risk-based		11.5	%	11.3	%	11.1	%	11.2	%	11.1	%	10.8	%
Total risk-based		12.5	%	12.2	%	12.0	%	12.0	%	11.9	%	11.6	%
Leverage		9.7	%	9.7	%	9.7	%	9.7	%	9.8	%	9.9	%
Construction and land development loans as a percentage of total capital ⁽¹⁷⁾		72.9	%	77.5	%	84.2	%	83.1	%	84.5	%	88.5	%
Non-owner occupied commercial real estate and multi-family as a percentage of total capital ⁽¹⁷⁾		254.0	%	258.0	%	259.0	%	256.4	%	256.7	%	261.1	%

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

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED

*(dollars in thousands, except per share data)*	June			March		December		September		June		March
*(dollars in thousands, except per share data)*	2024			2024		2023		2023		2023		2023

Per share data:
Earnings per common share – basic	$	0.65		1.58		1.20		1.69		2.55		1.76
Earnings per common share - basic, excluding non-GAAP adjustments	$	1.63		1.54		1.70		1.79		1.80		1.76
Earnings per common share – diluted	$	0.64		1.57		1.19		1.69		2.54		1.76
Earnings per common share - diluted, excluding non-GAAP adjustments	$	1.63		1.53		1.68		1.79		1.79		1.76
Common dividends per share	$	0.22		0.22		0.22		0.22		0.22		0.22
Book value per common share at quarter end ⁽⁷⁾	$	77.15		76.23		75.80		73.23		73.32		71.24
Tangible book value per common share at quarter end ⁽⁷⁾	$	52.92		51.98		51.38		48.78		48.85		46.75
Revenue per diluted common share	$	4.78		5.60		5.16		5.35		6.43		5.28
Revenue per diluted common share, excluding non-GAAP adjustments	$	5.72		5.45		5.25		5.48		5.43		5.28

Investor information:
Closing sales price of common stock on last trading day of quarter	$	80.04		85.88		87.22		67.04		56.65		55.16
High closing sales price of common stock during quarter	$	84.70		91.82		89.34		75.95		57.93		82.79
Low closing sales price of common stock during quarter	$	74.62		79.26		60.77		56.41		46.17		52.51

Closing sales price of depositary shares on last trading day of quarter	$	23.25		23.62		22.60		22.70		23.75		24.15
High closing sales price of depositary shares during quarter	$	23.85		24.44		23.65		23.85		24.90		25.71
Low closing sales price of depositary shares during quarter	$	22.93		22.71		21.00		21.54		19.95		20.77

Other information:
Residential mortgage loan sales:
Gross loans sold	$	217,080		148,576		142,556		198,247		192,948		120,146
Gross fees ⁽⁸⁾	$	5,368		3,540		3,191		4,350		4,133		2,795
Gross fees as a percentage of loans originated		2.47	%	2.38	%	2.24	%	2.19	%	2.14	%	2.33	%
Net gain (loss) on residential mortgage loans sold	$	3,270		2,879		879		2,012		1,567		2,053
Investment gains (losses) on sales of securities, net ⁽¹³⁾	$	(72,103	)	—		14		(9,727	)	(9,961	)	—
Brokerage account assets, at quarter end ⁽⁹⁾	$	11,917,578		10,756,108		9,810,457		9,041,716		9,007,230		8,634,339
Trust account managed assets, at quarter end	$	6,443,916		6,297,887		5,530,495		5,047,128		5,084,592		4,855,951
Core deposits ⁽¹⁰⁾	$	34,957,827		34,638,610		33,738,917		33,606,783		32,780,767		32,054,111
Core deposits to total funding ⁽¹⁰⁾		82.2	%	82.2	%	81.7	%	81.9	%	80.9	%	82.4	%
Risk-weighted assets	$	39,983,191		40,531,311		40,205,295		39,527,086		38,853,588		38,117,659
Number of offices		135		128		128		128		127		126
Total core deposits per office	$	258,947		270,614		263,585		262,553		258,116		254,398
Total assets per full-time equivalent employee	$	14,231		14,438		14,287		14,274		14,166		13,750
Annualized revenues per full-time equivalent employee	$	425.0		508.5		468.4		486.2		593.0		496.5
Annualized expenses per full-time equivalent employee	$	314.6		287.8		296.8		254.1		256.5		261.7
Number of employees (full-time equivalent)		3,469.0		3,386.5		3,357.0		3,329.5		3,309.0		3,281.5
Associate retention rate ⁽¹¹⁾		94.4	%	94.2	%	94.2	%	93.6	%	94.1	%	93.8	%

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

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED
	Three months ended							Six months ended
**(dollars in thousands, except per share data)**	June			March		June		June		June
**(dollars in thousands, except per share data)**	2024			2024		2023		2024		2023

Net interest income	$	332,262		318,034		315,393		650,296		627,624

Noninterest income		34,288		110,103		173,839		144,391		263,368
Total revenues		366,550		428,137		489,232		794,687		890,992
Less: Investment losses (gains) on sales of securities, net		72,103		—		9,961		72,103		9,961
Gain on sale of fixed assets as a result of sale-leaseback transaction		—		—		(85,692	)	—		(85,692	)
Recognition of mortgage servicing asset		—		(11,812	)	—		(11,812	)	—
Total revenues excluding the impact of adjustments noted above	$	438,653		416,325		413,501		854,978		815,261

Noninterest expense	$	271,389		242,365		211,641		513,754		423,368
Less: ORE expense		22		84		58		106		157
FDIC special assessment		—		7,250		—		7,250		—
Fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives		28,400		—		—		28,400		—
Noninterest expense excluding the impact of adjustments noted above	$	242,967		235,031		211,583		477,998		423,211

Pre-tax income	$	65,002		151,275		245,902		216,277		417,168
Provision for credit losses		30,159		34,497		31,689		64,656		50,456
Pre-tax pre-provision net revenue		95,161		185,772		277,591		280,933		467,624
Less: Adjustments noted above		100,525		(4,478	)	(75,673	)	96,047		(75,574	)
Adjusted pre-tax pre-provision net revenue ⁽¹²⁾	$	195,686		181,294		201,918		376,980		392,050

Noninterest income	$	34,288		110,103		173,839		144,391		263,368
Less: Adjustments noted above		72,103		(11,812	)	(75,731	)	60,291		(75,731	)
Noninterest income excluding the impact of adjustments noted above	$	106,391		98,291		98,108		204,682		187,637

Efficiency ratio ⁽⁴⁾		74.04	%	56.61	%	43.26	%	64.65	%	47.52	%
Adjustments noted above		(18.65	)%	(0.16	)%	7.91	%	(8.74	)%	4.39	%
Efficiency ratio excluding adjustments noted above ⁽⁴⁾		55.39	%	56.45	%	51.17	%	55.91	%	51.91	%

Total average assets	$	48,754,091		48,311,260		45,411,961		48,532,674		44,204,666

Noninterest income to average assets ⁽¹⁾		0.28	%	0.92	%	1.54	%	0.60	%	1.20	%
Less: Adjustments noted above		0.60	%	(0.10	)%	(0.67	)%	0.25	%	(0.34	)%
Noninterest income (excluding adjustments noted above) to average assets ⁽¹⁾		0.88	%	0.82	%	0.87	%	0.85	%	0.86	%

Noninterest expense to average assets ⁽¹⁾		2.24	%	2.02	%	1.87	%	2.13	%	1.93	%
Adjustments as noted above		(0.24	)%	(0.06	)%	—	%	(0.15	)%	—	%
Noninterest expense (excluding adjustments noted above) to average assets ⁽¹⁾		2.00	%	1.96	%	1.87	%	1.98	%	1.93	%

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

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED
	Three months ended
(dollars in thousands, except per share data)	June			March		December		September		June		March
(dollars in thousands, except per share data)	2024			2024		2023		2023		2023		2023
Net income available to common shareholders	$	49,364		120,146		91,181		128,805		193,501		133,473
Investment (gains) losses on sales of securities, net		72,103		—		(14	)	9,727		9,961		—
Gain on sale of fixed assets as a result of sale-leaseback transaction		—		—		—		—		(85,692	)	—
Loss on BOLI restructuring		—		—		16,252		—		—		—
FDIC special assessment		—		7,250		29,000		—		—		—
ORE expense		22		84		125		33		58		99
Recognition of mortgage servicing asset		—		(11,812	)	—		—		—		—
Fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives		28,400		—		—		—		—		—
Tax effect on above noted adjustments ⁽¹⁶⁾		(25,131	)	1,120		(7,278	)	(2,440	)	18,918		(25	)
Net income available to common shareholders excluding adjustments noted above	$	124,758		116,788		129,266		136,125		136,746		133,547

Basic earnings per common share	$	0.65		1.58		1.20		1.69		2.55		1.76
Less:
Investment (gains) losses on sales of securities, net		0.94		—		—		0.13		0.13		—
Gain on sale of fixed assets as a result of sale-leaseback transaction		—		—		—		—		(1.13	)	—
Loss on BOLI restructuring		—		—		0.21		—		—		—
FDIC special assessment		—		0.10		0.38		—		—		—
ORE expense		—		—		—		—		—		—
Recognition of mortgage servicing asset		—		(0.15	)	—		—		—		—
Fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives		0.37		—		—		—		—		—
Tax effect on above noted adjustments⁽¹⁶⁾		(0.33	)	0.01		(0.10	)	(0.03	)	0.25		—
Basic earnings per common share excluding adjustments noted above	$	1.63		1.54		1.70		1.79		1.80		1.76

Diluted earnings per common share	$	0.64		1.57		1.19		1.69		2.54		1.76
Less:
Investment (gains) losses on sales of securities, net		0.94		—		—		0.13		0.13		—
Gain on sale of fixed assets as a result of sale-leaseback transaction		—		—		—		—		(1.13	)	—
Loss on BOLI restructuring		—		—		0.21		—		—		—
FDIC special assessment		—		0.10		0.38		—		—		—
ORE expense		—		—		—		—		—		—
Recognition of mortgage servicing asset		—		(0.15	)	—		—		—		—
Fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives		0.37		—		—		—		—		—
Tax effect on above noted adjustments⁽¹⁶⁾		(0.32	)	0.01		(0.09	)	(0.03	)	0.25		—
Diluted earnings per common share excluding the adjustments noted above	$	1.63		1.53		1.68		1.79		1.80		1.76

Revenue per diluted common share	$	4.78		5.60		5.16		5.35		6.43		5.28
Adjustments due to revenue-impacting items as noted above		0.94		(0.15	)	0.09		0.13		(1.00	)	—
Revenue per diluted common share excluding adjustments due to revenue-impacting items as noted above	$	5.72		5.45		5.25		5.48		5.43		5.28

Book value per common share at quarter end ⁽⁷⁾	$	77.15		76.23		75.80		73.23		73.32		71.24
Adjustment due to goodwill, core deposit and other intangible assets		(24.23	)	(24.25	)	(24.42	)	(24.45	)	(24.47	)	(24.49	)
Tangible book value per common share at quarter end ⁽⁷⁾	$	52.92		51.98		51.38		48.78		48.85		46.75

Equity method investment ⁽¹⁵⁾
Fee income from BHG, net of amortization	$	18,688		16,035		14,432		24,967		26,924		19,079
Funding cost to support investment		5,704		5,974		5,803		6,546		6,005		5,768
Pre-tax impact of BHG		12,984		10,061		8,629		18,421		20,919		13,311
Income tax expense at statutory rates ⁽¹⁶⁾		3,246		2,515		2,157		4,605		5,230		3,328
Earnings attributable to BHG	$	9,738		7,546		6,472		13,816		15,689		9,983
Basic earnings per common share attributable to BHG	$	0.13		0.10		0.09		0.18		0.21		0.13
Diluted earnings per common share attributable to BHG	$	0.13		0.10		0.08		0.18		0.21		0.13
This information is preliminary and based on company data available at the time of the presentation.

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED
	Six months ended
(dollars in thousands, except per share data)	June 30,
(dollars in thousands, except per share data)	2024			2023
Net income available to common shareholders	$	169,510		326,974
Investment losses on sales of securities, net		72,103		9,961
Gain on sale of fixed assets as a result of sale-leaseback transaction		—		(85,692	)
Loss on BOLI restructuring		—		—
ORE expense		106		157
FDIC special assessment		7,250		—
Recognition of mortgage servicing asset		(11,812	)	—
Fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives		28,400		—
Tax effect on adjustments noted above ⁽¹⁶⁾		(24,012	)	18,894
Net income available to common shareholders excluding adjustments noted above	$	241,545		270,294

Basic earnings per common share	$	2.22		4.30
Less:
Investment (gains) losses on sales of securities, net		0.94		0.13
Gain on sale of fixed assets as a result of sale-leaseback transaction		—		(1.13	)
ORE expense		—		—
Recognition of mortgage servicing asset		(0.15	)	—
FDIC special assessment		0.09		—
Fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives		0.37		—
Tax effect on above noted adjustments ⁽¹⁶⁾		(0.31	)	0.25
Basic earnings per common share excluding adjustments noted above	$	3.16		3.55

Diluted earnings per common share		2.21		4.30
Less:
Investment (gains) losses on sales of securities, net		0.94		0.13
Gain on sale of fixed assets as a result of sale-leaseback transaction		—		(1.13	)
Loss on BOLI restructuring		—		—
ORE expense		—		—
FDIC special assessment		0.09		—
Recognition of mortgage servicing asset		(0.15	)	—
Fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives		0.37		—
Tax effect on above noted adjustments⁽¹⁶⁾		(0.31	)	0.25
Diluted earnings per common share excluding the adjustments noted above	$	3.16		3.55

Revenue per diluted common share	$	10.38		11.71
Adjustments due to revenue-impacting items as noted above		0.79		(0.99	)
Revenue per diluted common share excluding adjustments due to revenue-impacting items noted above	$	11.17		10.72


Equity method investment ⁽¹⁵⁾
Fee income from BHG, net of amortization	$	34,723		46,003
Funding cost to support investment		11,584		11,088
Pre-tax impact of BHG		23,139		34,915
Income tax expense at statutory rates ⁽¹⁶⁾		5,785		8,729
Earnings attributable to BHG	$	17,354		26,186

Basic earnings per common share attributable to BHG	$	0.23		0.34
Diluted earnings per common share attributable to BHG	$	0.23		0.34

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

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED
	Three months ended							Six months ended
**(dollars in thousands, except per share data)**	June			March		June		June			June
**(dollars in thousands, except per share data)**	2024			2024		2023		2024			2023

Return on average assets ⁽¹⁾		0.41	%	1.00	%	1.71	%		0.70	%	1.49	%
Adjustments as noted above		0.62	%	(0.03	)%	(0.50	)%		0.30	%	(0.26	)%
Return on average assets excluding adjustments noted above ⁽¹⁾		1.03	%	0.97	%	1.21	%		1.00	%	1.23	%

Tangible assets:
Total assets	$	49,366,969		48,894,196		46,875,982		$	49,366,969		46,875,982
Less: Goodwill		(1,846,973	)	(1,846,973	)	(1,846,973	)		(1,846,973	)	(1,846,973	)
Core deposit and other intangible assets		(24,313	)	(25,881	)	(30,981	)		(24,313	)	(30,981	)
Net tangible assets	$	47,495,683		47,021,342		44,998,028		$	47,495,683		44,998,028

Tangible common equity:
Total shareholders' equity	$	6,174,668		6,103,851		5,843,759		$	6,174,668		5,843,759
Less: Preferred shareholders' equity		(217,126	)	(217,126	)	(217,126	)		(217,126	)	(217,126	)
Total common shareholders' equity		5,957,542		5,886,725		5,626,633			5,957,542		5,626,633
Less: Goodwill		(1,846,973	)	(1,846,973	)	(1,846,973	)		(1,846,973	)	(1,846,973	)
Core deposit and other intangible assets		(24,313	)	(25,881	)	(30,981	)		(24,313	)	(30,981	)
Net tangible common equity	$	4,086,256		4,013,871		3,748,679		$	4,086,256		3,748,679

Ratio of tangible common equity to tangible assets		8.60	%	8.54	%	8.33	%		8.60	%	8.33	%

Average tangible assets:
Average assets	$	48,754,091		48,311,260		45,411,961		$	48,532,674		44,204,666
Less: Average goodwill		(1,846,973	)	(1,846,973	)	(1,846,973	)		(1,846,973	)	(1,846,973	)
Average core deposit and other intangible assets		(25,309	)	(26,898	)	(32,135	)		(26,103	)	(33,021	)
Net average tangible assets	$	46,881,809		46,437,389		43,532,853		$	46,659,598		42,324,672

Return on average assets ⁽¹⁾		0.41	%	1.00	%	1.71	%		0.70	%	1.49	%
Adjustment due to goodwill, core deposit and other intangible assets		0.01	%	0.04	%	0.07	%		0.03	%	0.07	%
Return on average tangible assets ⁽¹⁾		0.42	%	1.04	%	1.78	%		0.73	%	1.56	%
Adjustments as noted above		0.65	%	(0.03	)%	(0.52	)%		0.31	%	(0.27	)%
Return on average tangible assets excluding adjustments noted above ⁽¹⁾		1.07	%	1.01	%	1.26	%		1.04	%	1.29	%

Average tangible common equity:
Average shareholders' equity	$	6,138,722		6,082,616		5,782,239		$	6,110,669		5,694,460
Less: Average preferred equity		(217,126	)	(217,126	)	(217,126	)		(217,126	)	(217,126	)
Average common equity		5,921,596		5,865,490		5,565,113			5,893,543		5,477,334
Less: Average goodwill		(1,846,973	)	(1,846,973	)	(1,846,973	)		(1,846,973	)	(1,846,973	)
Average core deposit and other intangible assets		(25,309	)	(26,898	)	(32,135	)		(26,103	)	(33,021	)
Net average tangible common equity	$	4,049,314		3,991,619		3,686,005		$	4,020,467		3,597,340

Return on average equity⁽¹⁾		3.23	%	7.94	%	13.42	%		5.58	%	11.58	%
Adjustment due to average preferred shareholders' equity		0.12	%	0.30	%	0.53	%		0.20	%	0.46	%
Return on average common equity ⁽¹⁾		3.35	%	8.24	%	13.95	%		5.78	%	12.04	%
Adjustment due to goodwill, core deposit and other intangible assets		1.55	%	3.87	%	7.11	%		2.70	%	6.29	%
Return on average tangible common equity ⁽¹⁾		4.90	%	12.11	%	21.06	%		8.48	%	18.33	%
Adjustments as noted above		7.49	%	(0.34	)%	(6.18	)%		3.60	%	(3.18	)%
Return on average tangible common equity excluding adjustments noted above ⁽¹⁾		12.39	%	11.77	%	14.88	%		12.08	%	15.15	%


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

PINNACLE FINANCIAL PARTNERS, INC. AND SUBSIDIARIES

SELECTED QUARTERLY FINANCIAL DATA – UNAUDITED

1. Ratios are presented on an annualized basis.

2. Net interest margin is the result of net interest income on a tax equivalent basis divided by average interest earning assets.

3. Total revenue is equal to the sum of net interest income and noninterest income.

4. Efficiency ratios are calculated by dividing noninterest expense by the sum of net interest income and noninterest income.

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

6. Capital ratios are calculated using regulatory reporting regulations enacted for such period and are defined as follows:

Equity to total assets – End of period total shareholders' equity as a percentage of end of period assets.

Tangible common equity to tangible assets - End of period total shareholders' equity less end of period preferred stock, goodwill, core deposit and other intangibles as a percentage of end of period assets less end of period goodwill, core deposit and other intangibles.

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

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

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

Classified asset - Classified assets as a percentage of Tier 1 capital plus allowance for credit losses.

Tier I common equity to risk weighted assets - Tier 1 capital (pursuant to risk-based capital guidelines) less the amount of any preferred stock or subordinated indebtedness that is considered as a component of Tier 1 capital as a percentage of total risk-weighted assets.

7. Book value per common share computed by dividing total common shareholders' equity by common shares outstanding. Tangible book value per common share computed by dividing total common shareholders' equity, less goodwill, core deposit and other intangibles by common shares outstanding.

8. Amounts are included in the statement of income in "Gains on mortgage loans sold, net", net of commissions paid on such amounts.

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

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

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

12. Adjusted pre-tax, pre-provision net revenue excludes the impact of ORE expenses and income, investment gains and losses on sales of securities, the impact of BOLI restructuring, the impact of the FDIC special assessment, the recognition of the mortgage servicing asset and fees related to terminating agreement to resell securities previously purchased and professional fees associated with capital optimization initiatives.

13. Represents investment gains (losses) on sales and impairments, net occurring as a result of gains or losses incurred as the result of a change in management's intention to sell a bond prior to the recovery of its amortized cost basis.

14. The dividend payout ratio is calculated as the sum of the annualized dividend rate for dividends paid on common shares divided by the trailing 12-months fully diluted earnings per common share as of the dividend declaration date.

15. Earnings from equity method investment includes the impact of the funding costs of the overall franchise calculated using the firm's subordinated and other borrowing rates. Income tax expense is calculated using statutory tax rates.

16. Tax effect calculated using the blended statutory rate of 25.00 percent for all periods in 2024 and 2023.

17. Calculated using the same guidelines as are used in the Federal Financial Institutions Examination Council's Uniform Bank Performance Report.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240716482425/en/

MEDIA CONTACT: Joe Bass, 615-743-8219

FINANCIAL CONTACT: Harold Carpenter, 615-744-3742

WEBSITE: www.pnfp.com

Source: Pinnacle Financial Partners, Inc.

FAQ

What was Pinnacle Financial Partners' (PNFP) net income per diluted share for Q2 2024?

PNFP reported net income per diluted share of $0.64 for Q2 2024.

How did Pinnacle Financial Partners' (PNFP) net income per diluted share for Q2 2024 compare to Q2 2023?

Net income per diluted share decreased by 74.8% from $2.54 in Q2 2023 to $0.64 in Q2 2024.

What was Pinnacle Financial Partners' (PNFP) net interest margin for Q2 2024?

PNFP's net interest margin was 3.14% for Q2 2024.

How much did Pinnacle Financial Partners' (PNFP) total assets increase by June 30, 2024?

PNFP's total assets increased to $49.4 billion, a 5.3% year-over-year increase by June 30, 2024.

What were Pinnacle Financial Partners' (PNFP) capital optimization and balance sheet repositioning initiatives in Q2 2024?

PNFP executed several initiatives, including selling securities and terminating agreements, incurring significant losses but aiming for long-term revenue enhancement.

What was Pinnacle Financial Partners' (PNFP) pre-tax, pre-provision net revenue (PPNR) for Q2 2024?

PNFP's PPNR for Q2 2024 was $95.2 million, down 65.7% year-over-year.

How did Pinnacle Financial Partners' (PNFP) core deposits perform in Q2 2024?

Core deposits for PNFP rose by 11% year-over-year to $27.02 billion in Q2 2024.

How did Pinnacle Financial Partners' (PNFP) noninterest income change in Q2 2024?

PNFP's noninterest income decreased by 80.3% year-over-year in Q2 2024.

What were the significant fee expenses for Pinnacle Financial Partners (PNFP) in Q2 2024?

PNFP incurred $28.4 million in fees related to capital optimization initiatives in Q2 2024.

PNFP Reports 2Q24 Diluted EPS of $0.64 and Net Interest Margin of 3.14 Percent

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What was Pinnacle Financial Partners' (PNFP) net income per diluted share for Q2 2024?

How did Pinnacle Financial Partners' (PNFP) net income per diluted share for Q2 2024 compare to Q2 2023?

What was Pinnacle Financial Partners' (PNFP) net interest margin for Q2 2024?

How much did Pinnacle Financial Partners' (PNFP) total assets increase by June 30, 2024?

What were Pinnacle Financial Partners' (PNFP) capital optimization and balance sheet repositioning initiatives in Q2 2024?

What was Pinnacle Financial Partners' (PNFP) pre-tax, pre-provision net revenue (PPNR) for Q2 2024?

How did Pinnacle Financial Partners' (PNFP) core deposits perform in Q2 2024?

How did Pinnacle Financial Partners' (PNFP) noninterest income change in Q2 2024?

What were the significant fee expenses for Pinnacle Financial Partners (PNFP) in Q2 2024?

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PNFP Reports 2Q24 Diluted EPS of $0.64 and Net Interest Margin of 3.14 Percent

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FAQ

What was Pinnacle Financial Partners' (PNFP) net income per diluted share for Q2 2024?

How did Pinnacle Financial Partners' (PNFP) net income per diluted share for Q2 2024 compare to Q2 2023?

What was Pinnacle Financial Partners' (PNFP) net interest margin for Q2 2024?

How much did Pinnacle Financial Partners' (PNFP) total assets increase by June 30, 2024?

What were Pinnacle Financial Partners' (PNFP) capital optimization and balance sheet repositioning initiatives in Q2 2024?

What was Pinnacle Financial Partners' (PNFP) pre-tax, pre-provision net revenue (PPNR) for Q2 2024?

How did Pinnacle Financial Partners' (PNFP) core deposits perform in Q2 2024?

How did Pinnacle Financial Partners' (PNFP) noninterest income change in Q2 2024?

What were the significant fee expenses for Pinnacle Financial Partners (PNFP) in Q2 2024?

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