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Announcements: MEDIA CONTACT: Vicki Kessler 615-320-7532
Pinnacle Financial Continues Rapid Growth NASHVILLE, Tenn., January 20, 2004 - Pinnacle Financial Partners, Inc. (Nasdaq: PNFP), the holding company for Pinnacle National Bank, today reported that net income for the year ended December 31, 2003, was $2,555,000, or $0.65 per diluted share, an increase of 210 percent when compared to Pinnacle's net income of $648,000, or $0.21 per diluted share for the year ended December 31, 2002. Total assets grew to $498 million as of December 31, 2003, up 63 percent from the $305 million reported at December 31, 2002. Loans as of December 31, 2003 were $297 million compared to $210 million a year earlier. Total deposits increased to $391 million at December 31, 2003, compared to $234 million on December 31, 2002. Net loan growth for the year ended December 31, 2003, was $87 million, compared to $76 million during 2002. Total deposit growth for the year ended December 31, 2003, was $157 million, compared to $101 million during 2002. "Our firm has experienced extraordinary growth in its first three years as evidenced by the fact that we are now the largest of the 181 commercial banks chartered in the United States during 2000. We are particularly pleased that the volume of growth during 2003 continued to escalate over the growth we had in our previous two years," said M. Terry Turner, President and CEO of Pinnacle Financial Partners. "During 2003, we recruited 37 associates to our firm, a 66% increase when compared to the number of associates at the end of last year. Also, during the fourth quarter of 2003, we continued to be successful in attracting several associates to the firm, all of whom have significant experience and have been actively involved in the Middle Tennessee banking and wealth management arena for many years. During 2003, we opened two new full service banking offices in the Rivergate and Cool Springs areas, and plan to open an office in the West End area of Nashville and another office in nearby Franklin, Tennessee in 2004. During the fourth quarter of 2003, we were successful in issuing $10 million in trust preferred securities. This should provide, under current guidelines, the regulatory capital we need to support our anticipated growth in 2004 and for the foreseeable future without diluting our current shareholder base." Net interest income for the year ended December 31, 2003, was $12.9 million, compared to $8.2 million for year ended December 31, 2002. The net interest margin for 2003 was 3.5 percent, compared to a net interest margin of 3.8 percent for the year ended December 31, 2002. The net interest margin for the fourth quarter of 2003 was 3.6 percent, compared to a net interest margin of 3.5 percent for the third quarter of 2003 and 3.6 percent for the fourth quarter of 2002. The provision for loan losses was $1.2 million for the year ended December 31, 2003, compared to $938,000 during 2002. The provision for loan losses was $204,000 for the fourth quarter of 2003, compared to $318,000 for the third quarter of 2003 and $250,000 for the fourth quarter of 2002. The allowance for loan losses represented 1.25 percent of total loans at December 31, 2003. Noninterest income for the year ended December 31, 2003, was $3.3 million, compared to $1.7 million during 2002. This increase was due to the continued development of Pinnacle's new mortgage origination unit, gains recognized on loan participations sold, increased depositor service charges due to more deposit accounts, increased investment services income from Pinnacle Asset Management and gains on the sale of investment securities. Noninterest income for the fourth quarter of 2003 was $924,000, compared to $1,024,000 for the third quarter of 2003 and $469,000 for the fourth quarter of 2002. For the year ended December 31, 2003, noninterest income represented approximately 20.3 percent of total revenues (the sum of net interest income and noninterest income), compared to 17.4 percent for the same period in 2002. Noninterest expense for the year ended December 31, 2003, was $11.0 million, compared to $8.0 million for the same period in 2002. Noninterest expense for the fourth quarter of 2003 was $3.3 million, compared to $2.8 million for the third quarter of 2003 and $2.2 million for the fourth quarter of 2002. The efficiency ratio (noninterest expense divided by total revenues) for the year ended December 31, 2003, improved to 68.3 percent, compared to 80.4 percent for the year ended December 31, 2002. Additionally, Pinnacle continues to increment expense levels to capitalize on continued market opportunities, including:
Based on these anticipated growth trends and the anticipated results from these trends, Pinnacle estimates its first quarter 2004 diluted earnings per share will approximate $0.23 to $0.25. Diluted earnings per share for the year ending December 31, 2004, are estimated to be $1.15 to $1.25. Management has developed several scenarios under which these estimates can be achieved and believes these estimates to be reasonable based on these scenarios. However, unanticipated events or developments may cause the actual results, performance or achievements of Pinnacle to differ materially from these estimates. Pinnacle Financial Partners, the largest financial services firm headquartered in Nashville, provides a full range of banking, investment and insurance products and services targeted at small- to mid-sized businesses and their owners/operators. A number of Pinnacle's senior financial advisors provide comprehensive wealth management services to help clients protect and distribute their assets. Pinnacle opened its first office in October 2000 in Commerce Center in Downtown Nashville. Since then the firm has added Nashville offices in Rivergate and Green Hills and in Brentwood and the Cool Springs area of Williamson County. Additional information concerning Pinnacle can be accessed at www.pnfp.com. ###
Certain of the statements in this release may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"). The words "expect," "anticipate," "intend," "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. All forward-looking statements are subject to risks, uncertainties and other facts that may cause the actual results, performance or achievements of Pinnacle to differ materially from any results expressed or implied by such forward-looking statements. Such factors include, without limitation, (i) unanticipated deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses, (ii) increased competition with other financial institutions, (iii) lack of sustained growth in the economy in the Nashville, Tennessee area, (iv) rapid fluctuations or unanticipated changes in interest rates, (v) the inability of Pinnacle to satisfy regulatory requirements for its expansion plans, and (vi) changes in the legislative and regulatory environment, a more detailed description of various risks is contained in Pinnacle's most recent annual report on Form 10-KSB. Many of such factors are beyond Pinnacle's ability to control or predict, and readers are cautioned not to put undue reliance on such forward-looking statements. Pinnacle disclaims any obligation to update or revise any forward-looking statements contained in this release, whether as a result of new information, future events or otherwise.
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