Fourth Quarter 2015 Investor Call M. Terry Turner, President and - - PowerPoint PPT Presentation

Fourth Quarter 2015 Investor Call

• M. Terry Turner, President and CEO

Harold R. Carpenter, EVP and CFO January 20, 2016

Forward-looking statements

Certain of the statements in this presentation may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "expect," "anticipate," "goal," "objective," "intend," "plan," "believe," "should," "hope," “pursue,” "seek," "estimate" and similar expressions are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking. All forward-looking statements are subject to risks, uncertainties and other factors that may cause the actual results, performance or achievements of Pinnacle Financial to differ materially from any results expressed or implied by such forward-looking statements. Such risks include, without limitation, (i) deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses; (ii) continuation of the historically low short-term interest rate environment; (iii) the inability of Pinnacle Financial to maintain the historical growth of its loan portfolio; (iv) changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments; (v) effectiveness of Pinnacle Financial's asset management activities in improving, resolving or liquidating lower-quality assets; (vi) increased competition with other financial institutions; (vii) greater than anticipated adverse conditions in the national or local economies including the Nashville-Davidson-Murfreesboro-Franklin MSA, the Knoxville MSA, the Chattanooga, TN-GA MSA and the Memphis, TN-MS-AR MSA, particularly in commercial and residential real estate markets; (viii) rapid fluctuations or unanticipated changes in interest rates on loans or deposits; (ix) the results of regulatory examinations; (x) the ability to retain large, uninsured deposits; (xi) the development of any new market other than the Nashville, Knoxville, Chattanooga or Memphis MSAs; (xii) a merger or acquisition; (xiii) risks of expansion into new geographic or product markets, like the expansion into the Chattanooga and Memphis MSAs; (xiv) any matter that would cause Pinnacle Financial to conclude that there was impairment of any asset, including intangible assets; (xv) reduced ability to attract additional financial advisors (or failure of such advisors to cause their clients to switch to Pinnacle Financial), to retain financial advisors (including those at CapitalMark Bank & Trust and Magna Bank) or otherwise to attract customers from other financial institutions; (xvi) further 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 and required capital maintenance levels; (xviii) risks associated with litigation, including the applicability of insurance coverage; (xix) the risk that the cost savings and any revenue synergies from the mergers with CapitalMark and Magna may not be realized or take longer than anticipated to be realized; (xx) disruption from the CapitalMark and Magna mergers with customers, suppliers or employee relationships; (xxi) the risk of successful integration of CapitalMark's and Magna's business with ours; (xxii) the amount of the costs, fees, expenses and charges related to the CapitalMark and Magna mergers; (xxiii) reputational risk and the reaction of Pinnacle Financial's, CapitalMark's and Magna's customers to the CapitalMark and Magna mergers; (xxiv) the risk that the integration of CapitalMark's and Magna's operations with Pinnacle Financial's will be materially delayed or will be more costly or difficult than expected; (xxv) approval of the declaration of any dividend by Pinnacle Financial's board of directors; (xxvi) the vulnerability of our network and online banking portals to unauthorized access, computer viruses, phishing schemes, spam attacks, human error, natural disasters, power loss and other security breaches; (xxvii) the possibility of increased compliance costs as a result of increased regulatory oversight, including oversight of companies in which Pinnacle Financial has significant investments, and the development of additional banking products for our corporate and consumer clients; (xxviii) the risks associated with our being a minority investor in Bankers Healthcare Group, LLC, including the risk that the owners of a majority of the equity interests in Bankers Healthcare Group decide to sell the company if not prohibited from doing so by the terms of our agreement with them; and (xxix) changes in state and federal legislation, regulations or policies applicable to banks and

• ther financial service providers, including regulatory or legislative developments arising out of current unsettled conditions in the economy, including implementation of

the Dodd-Frank Wall Street Reform and Consumer Protection Act. A more detailed description of these and other risks is contained herein and in Pinnacle Financial's most recent annual report on Form 10-K filed with the Securities and Exchange Commission on February 25, 2015 and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission on May 8, 2015, August 7, 2015 and November 9, 2015. Many of such factors are beyond Pinnacle Financial's ability to control or predict, and readers are cautioned not to put undue reliance on such forward-looking statements. Pinnacle Financial disclaims any obligation to update or revise any forward-looking statements contained in this report, whether as a result of new information, future events or otherwise.

Safe Harbor Statements

18.5% 18.1% 18.7%

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15

Classified Asset Ratio

$4,144 $4,590 $6,543

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15

Total Loans

(millions)

$4,102 $4,381 $6,333

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15

Total Core Deposits

(millions)

$0.44 $0.53 $0.69

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15

FD EPS*

1.64% 1.47% 1.00%

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15

ALL %

0.80% 0.62% 0.55%

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15

NPA %

$13.52 $15.60 $17.46

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15

Tangible Book Value per Share

$15,321 $18,737 $28,367

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15

Net Income*

$57,456 $64,697 $98,083

1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15

Total Revenues

4Q15 Summary Results

Balance Sheet Growth Earnings Growth Asset Quality

Up 42.6% yr/yr Up 44.6% yr/yr Up 51.4% yr/yr Up 51.6% yr/yr

Execution of fundamentals fueled exceptional growth in key valuation drivers

Up 11.9% yr/yr

*: excluding tax effected merger related charges

Previously outlined growth initiatives are moving forward

1. CapitalMark and Magna mergers

• Legal mergers – Accomplished in 3Q15
• Financial case – Results for 2015 better than planned ($0.06- $0.08 FDEPS)
• Technology conversions – Magna conversion completed in November 2015;

CapitalMark conversion set for March 2016.

• Cultural integration – Ongoing, with all key associates retained

2. CRE initiative is producing ahead of schedule with almost $100mm in balances at EOP 2015 and $253mm in unfunded commercial construction loans 3. Obtained regulatory approvals for a broker/dealer and PNFP Capital Markets working through its first engagement 4. Aggressive hiring ahead of schedule – 36 revenue producers in 2015, roughly three times prior year pace

4Q15 Summary Results

4

5

Organic growth and acquisitions fuel significant growth in net interest income

$36.0 $37.8 $38.4 $39.3 $39.5 $40.2 $40.9 $42.2 $42.8 $43.6 $44.6 $45.0 $45.9 $47.2 $49.5 $50.3 $51.3 $51.8 $62.1 $71.5 3.40% 3.66% 3.73%

2.00% 2.25% 2.50% 2.75% 3.00% 3.25% 3.50% 3.75% 4.00% 4.25%

$30 $35 $40 $45 $50 $55 $60 $65 $70 $75

Net Interest Margin Net Interest Income

(millions)

Loan, Deposit and Fee Growth Yield Operating Leverage

6

Linked quarter loan volumes and yields rose dramatically in 4Q15

$3,191 $3,212 $3,207 $3,262 $3,280 $3,403 $3,489 $3,580 $3,682 $3,845 $3,932 $3,981 $4,130 $4,251 $4,358 $4,436 $4,625 $4,737 $5,690 $6,458

4.88% 4.33% 4.46%

1.00% 2.00% 3.00% 4.00% 5.00% 6.00% $2,000 $3,000 $4,000 $5,000 $6,000 $7,000

Loan Yields Average Loans

(millions)

• Avg. Loans

Loan Yields

Loan, Deposit and Fee Growth Yield Operating Leverage

7

Deposits grew rapidly and deposit rated moved more slower than loan yields

$3,772 $3,723 $3,700 $3,642 $3,597 $3,636 $3,706 $3,883 $3,950 $3,963 $4,199 $4,408 $4,509 $4,519 $4,655 $4,758 $4,792 $4,885 $5,898 $6,787

1.01% 0.27%

0.00% 0.25% 0.50% 0.75% 1.00% 1.25% $2,000 $3,000 $4,000 $5,000 $6,000 $7,000

• Avg. Deposits

(millions)

• Avg. Deposits

Cost of Deposits

Loan, Deposit and Fee Growth Yield Operating Leverage

8

Balance sheet positioned for rising rates

Loan, Deposit and Fee Growth Yield Operating Leverage

$1.25 $0.64

$- $0.50 $1.00 $1.50 EOP 2011 EOP 2015

Loans w/ Floors

$0.86 $0.84

$0.60 $0.70 $0.80 $0.90 EOP 2011 EOP 2015

Fixed Rate Bond Book

$0.72 $1.89

$- $0.50 $1.00 $1.50 $2.00 EOP 2011 EOP 2015

Noninterest Deposits

(billions of dollars) (billions of dollars) (billions of dollars)

38.5% - As a % of loans - 9.8% 17.7% - As a % of assets – 9.6% 19.7% - As a % of deposits – 27.1%

• 1.35%

3.03% 1.43% 6.22%

• 2.00%

0.00% 2.00% 4.00% 6.00% 8.00% EOP 2011 EOP 2015

IRR Sensitivity

(Immediate shock)

Up 100 Up 200

9

Expansion of fee businesses produced record fee revenues in 4Q15

4Q15 3Q15 2Q15 1Q15 4Q14 Service charges $3,500 $3,258 $3,076 $2,913 $3,038 Investment services 2,787 2,526 2,399 2,259 2,737 Insurance commissions 1,103 1,103 1,106 1,513 1,046 Gain on mortgage loans sold, net 2,181 1,895 1,652 1,941 1,374 Trust fees 1,482 1,437 1,230 1,312 1,274 Income from equity method investment 7,839 5,285 4,266 3,201

• Other:

Securities gains (losses) (10)

• 556

6

• Interchange and other consumer fees

5,558 4,964 3,893 3,799 3,591 Bank-owned life insurance 714 661 573 600 577 Loan swap fees 604 398 611 482 129 Other 850 (117) 657 468 618 Total noninterest income $26,608 $21,410 $20,019 $18,494 $14,384 Total Assets (Quarterly Average) $8,565,341 $7,514,633 $6,319,712 $6,102,523 $5,855,421 Noninterest income/Average Assets 1.23% 1.13% 1.27% 1.23% 0.97% Core Noninterest Income**/ Average Assets 1.23% 1.13% 1.24% 1.23% 0.97%

Loan, Deposit and Fee Growth Yield Operating Leverage

** Excludes the impact of securities gains (losses)

10

Operating leverage led to an all time best core efficiency ratio

4Q15 3Q15 2Q15 1Q15 4Q14 Salaries and benefits $30,878 $27,746 $23,775 $23,531 $23,075 Equipment and occupancy 8,385 6,933 5,878 6,046 5,984 Other real estate owned 99 (686) (115) 395 (630) Marketing and business development 1,465 1,252 1,186 960 1,208 Supplies and postage 1,052 795 731 649 717 Intangible amortization 917 602 227 227 236 Merger related expense 2,489 2,249 59

• Other expenses

6,906 6,216 5,006 5,023 3,801 Total noninterest expense $52,191 $45,107 $36,747 $36,831 $34,391 Efficiency ratio 53.2% 54.0% 51.1% 52.8% 53.2% Expense/Total Average Assets 2.42% 2.38% 2.33% 2.45% 2.33% Core noninterest expense ** $49,603 $43,544 $36,324 $36,436 $35,021 Core efficiency ratio 50.6% 52.2% 50.9% 52.2% 54.1% Core Noninterest Expense**/Total Average Assets 2.30% 2.30% 2.31% 2.42% 2.37%

** Excludes the impact of OREO expense, FHLB prepayment charges and merger related expenses

Loan, Deposit and Fee Growth Yield Operating Leverage

11

(1) - Calculation excludes net gains and losses on the sale of investment securities and in the second quarter of 2013 noncredit related loan losses (2) - Calculation excludes OREO expense, FHLB prepayment charges and merger related expenses. Noninterest expense for 2Q13 includes the impact of the reversal of a $2.0 million allowance for off-balance sheet commitments

• -- : Reflects targets resulting from the annual corporate strategic planning process for the then current period.

Changes to long-term targets reflect PNFP operating leverage

Pinnacle Building for the Future

0.94% 1.13% 1.27% 1.31%

0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 1.40% 1.60%

ROA (2)

2.52% 2.38% 2.37% 2.30% 2.00% 2.10% 2.20% 2.30% 2.40% 2.50% 2.60% 2.70% Noninterest Expense / Average Assets (2) 3.80% 3.70% 3.76% 3.73% 3.50% 3.55% 3.60% 3.65% 3.70% 3.75% 3.80% 3.85% 3.90% 3.95%

Net Interest Margin

0.29% 0.15% 0.10% 0.21% 0.00% 0.05% 0.10% 0.15% 0.20% 0.25% 0.30% 0.35% 0.40% 0.45% 0.50%

Net Chargeoff Ratio

0.89% 0.92% 0.97% 1.23% 0.70% 0.80% 0.90% 1.00% 1.10% 1.20% 1.30%

Noninterest Income / Average Assets (1)

Expanded BHG Partnership Will Provide Opportunities to Both Firms

12

83rd

percentile

Pinnacle Building for the Future

Feb 2015 investment Feb 2016 investment(1) Consideration $75mm for 30% interest $114mm for 19% interest, aggregate 49% interest Financing Debt and on-balance sheet cash 912,000 shares of PNFP common with residual in cash. Anticipate a bank level sub- debt offering in 1Q16 to support cash payout Accounting Equity investment in unconsolidated subsidiary Board seats One board seat (25% of board vote) One additional board seat (40% of board vote) Accretion 2015 FDEPS impact to PNFP FDEPS approximated $0.26 Anticipate that 19% BHG interest will approximate an additional 2% FDEPS accretion in 2016 and 4% in 2017. TBV earn back < 1 year. Other key contract terms a. Non-competes for BHG principals for longer of 5 years or 24-months post-resignation b. Four year period during which BHG cannot be acquired without approval of both PNFP and founders c. Five year period during which neither BHG principals nor PNFP can transfer units without consent of other party

(1) Assumes a February 20, 2016 closing

13

BHG posts accelerating and impressive growth

Pinnacle Building for the Future

$0 $50 $100 $150 $200 $250 $300 $350 $400 $450 Originations Revenues Net income B4 tax 2012 2013 2014 2015

(millions of dollars)

Loans by healthcare specialty 2015

• riginations

Physicians & Surgeons $248.9 Dentists $ 83.0 Physical Therapists $ 22.3 Veterinarians $ 18.3 Other $ 52.4 Totals $424.9

2015 Growth - 56.3% 2015 Growth – 57.9% 2015 Growth – 71.4% Source: Company information

14

BHG specialized focus results in significant returns

Pinnacle Building for the Future

2015 Growth - 56.3% Rates Original balances # of loans

• Avg. term

(months)

• Avg. Rate
• Avg. FICO

Current Balance % of portfolio < 12% $360.3 3,324 76 10.02% 756 $273.1 32.0% 12% to < 15% 278.7 2,958 80 13.84% 720 185.6 21.8% 15% to < 17% 242.4 2,659 82 16.02% 706 138.6 16.2% 17% to < 18% 692.6 7,555 84 17.98% 699 240.0 28.1% > 18% 62.0 979 71 22.27% 667 16.2 1.9% $1,636.0 17,475 81 15.71% 713 $853.4 100.0% Source: Company information

2015 Goals and Objectives 2015 Results 5-Year Horizon

Dogged execution that produces and sustains increased results FDEPS growth, excluding merger related charges, of 29.9%

• Develop market

leadership in four Tennessee markets

• Pursue merger

candidates within current markets

• Expand CRE asset class
• Increase assets beyond

$10B

• Increase capital allocation

to fee businesses that can drive shareholder value

• Continued focus on

bottom line results Continue to grow loans and core deposits to achieve earnings targets and increase operating leverage Growth accelerating post-mergers, linked quarter loan growth of 13.1% Core deposits at highest levels in firm’s history Achieve elevated profitability targets Operating within all of our established profitability target ranges Operate a modestly asset sensitive balance sheet Modestly asset sensitive through expansion of floating rate assets Increase operating leverage – further advances in ER Core efficiency ratio of 50.6% in 4th quarter Maintain top quartile performance Maintained top quartile ROA, ROTE and soundness metrics through 3Q15.

Pinnacle Building for the Future

15

Pinnacle Building for the Future

Lower, longer rate forecast Credit leverage slows Margin compression continues Cost cutting jeopardizes future earnings and core deposits Mortgage revenues slow Energy lending concerns Robust banking markets Organic growth creates operating leverage despite aggressive hiring to sustain growth capacity Continued investment for future growth:

• M&A: CapitalMark, Magna, BHG
• Organic: Accelerating hiring, CRE,

Capital Markets Intense focus on building a valuable Tennessee franchise

4Q15 Bank Industry Trends 4Q15 Pinnacle Trends

16

Q&A –

Fourth Quarter 2015 Investor Call

Supplemental Information

Fourth Quarter 2015 Investor Call

Supplemental Information

19

Chart

• Balance Sheet

20

• Asset Quality

30

• Income Statement

34

• Pinnacle Financial Partners profile 40
• Economic and Market Conditions 46

Balance Sheet Supplemental Information

20

Loan portfolio well diversified

Balance Sheet

21 Amts. 4Q15 %’s(*) 4Q15 Amts. 3Q15 %’s(*) 3Q15 Amts. 4Q14 %’s 4Q14 Amts. 4Q13 %’s 4Q13 C&D and Land $747.7 11.4% $674.9 10.7% $322.5 7.0% $316.2 7.6% Consumer RE 1,046.5 16.0% 1,044.3 16.5% 721.2 15.7% 695.6 16.8% CRE – Owner Occ. 1,083.5 16.6% 1,124.9 17.8% 764.5 16.7% 679.3 16.4% CRE – Investment 953.5 14.6% 842.1 13.3% 596.4 13.0% 549.1 13.2% Other RE loans 238.5 3.6% 225.2 3.4% 183.1 4.0% 155.0 3.7% Total real estate 4,069.7 62.2% 3,911.4 61.7% 2,587.7 56.4% 2,395.2 57.7% C&I 2,228.5 34.1% 2,178.5 34.4% 1,784.7 38.9% 1,605.5 38.7% Other loans 245.0 3.7% 246.0 3.9% 217.6 4.7% 143.7 3.6% Total loans $6,543.2 100.0% $6,335.9 100.0% $4,590.0 100.0% $4,144.4 100.0%

(*) as a percentage of total loans

(*) as a percentage of total loans

Balance Sheet

22

Construction portfolio reflects quality growth

Amts. 4Q15 %’s(*) 4Q15 Amts. 3Q15 %’s(*) 3Q15 Amts. 4Q14 %’s(*) 4Q14 Amts. 4Q13 %’s(*) 4Q13 Residential – Spec $126.1 1.9% $102.1 1.6% $39.8 0.9% $28.2 0.7% Residential – Custom 54.1 0.8% 44.5 0.7% 34.4 0.8% 29.3 0.7% Residential – Condo 7.1 0.1% 3.5 0.1% 0.5 0.0% 3.6 0.1% Commercial Construct. 364.6 5.6% 352.1 5.6% 143.1 3.1% 131.3 3.2% Land Dev– Residential 74.5 1.1% 72.6 1.2% 63.6 1.4% 59.8 1.4% Land Dev – Commercial 99.1 1.8% 99.1 1.6% 39.7 0.9% 63.0 1.5% Land – Unimproved 2.1 0.0% 1.0 0.0% 1.5 0.0% 1.0 0.0% Total C&D $727.6 11.3% $674.9 10.8% $322.6 7.1% $316.2 7.6%

Balance Sheet

The C&I loan portfolio is highly diversified

23

NAICS Sector Description 4Q15 4Q14 Health Care and Social Assistance 4.53% 3.42% Finance and Insurance 2.45% 2.94% Real Estate and Rental and Leasing 0.15% 0.02% Manufacturing 1.50% 1.02% Consumer 5.37% 6.20% Transportation and Warehousing 8.18% 7.64% Wholesale Trade 1.59% 2.28% Retail Trade 10.28% 8.83% Construction 14.27% 16.13% Accommodation and Food Services 2.34% 2.87% Professional, Scientific, and Technical Services 0.40% 0.54% Public Administration 7.64% 6.65%

• Admin. & Support and Waste Mgt. and Remediation

0.02% 0.22% Information 2.20% 2.89% Other Services (except Public Administration) 3.91% 4.68% Educational Services 3.62% 3.95% Arts, Entertainment, and Recreation 11.10% 9.51% Management of Companies and Enterprises 5.64% 6.20% Agriculture, Forestry, Fishing and Hunting 8.14% 6.97% Utilities 0.07% 0.10% Mining, Quarrying, and Oil and Gas Extraction 6.58% 6.95% Total C&I Portfolio 100.00% 100.00%

Balance Sheet

24

PNFP maintains limited dependence on non-relationship funding

12/31/2015 Percent 12/31/2014 Percent Core Funding: Non-interest bearing deposits 1,889,865 25.22% 1,321,053 25.56% Interest-bearing deposits 1,355,405 18.09% 989,915 Money Market accounts 2,683,046 35.81% 1,751,698 33.89% Time deposits less than $250,000 404,494 5.40% 318,511 6.16% Total Core Funding 6,332,810 84.51% 4,381,177 84.77% Relationship based non-core funding: Reciprocal NOW deposits 34,144 0.46% 15,535 0.30% Reciprocal MMDA deposits 318,905 4.26% 273,259 5.29% Time deposits Reciprocal time deposits 50,203 0.67% 43,355 0.84% Other time deposits 228,064 3.04% 69,278 Securities sold under agreements to repurchase 79,084 1.06% 93,995 1.82% Total relationship based non-core funding 710,400 9.48% 495,422 9.59% Wholesale funding: Time deposits greater than $250,000 Public funds

• 0.00%
• 0.00%

Brokered deposits 7,288 0.10%

• 0.00%

FHLB advances 300,305 4.01% 195,476 3.78% Federal funds purchased

• 0.00%
• 0.00%

Other borrowings

• 0.00%

13,682 0.26% Subordinated debt 142,476 1.90% 82,476 1.60% Total wholesale funding 450,069 6.01% 291,634 5.64% Total non-core funding 1,160,469 15.49% 787,056 15.23% Totals 7,493,279 100.00% 5,168,233 100.00%

$957 $959 $1,000 $975 $1,009 $1,054 $1,055 $1,138 $1,105 $1,166 $1,190 $1,216 $1,247 $1,349 $1,375 $1,376 $1,440 $1,538 $2,087 $2,084 $747 $715 $685 $779 $808 $787 $815 $865 $941 $926 $989 $1,024 $1,028 $1,046 $1,131 $1,177 $1,221 $1,372 $2,407 $2,015 56.15% 50.83%

20% 30% 40% 50% 60% 70% $0 $1,000 $2,000 $3,000 $4,000 $5,000

Funded % Total Commitments

(millions)

Net active balance Unfunded Commitments Funded %

Unfunded line commitments hold potential for significant loan growth

25

Note: Excludes HELOCS and credit cards

Balance Sheet

26

Balance Sheet

The securities book is maintained at a minimal level

3.58% 2.45% 20.75% 11.70% 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% 35.00% 40.00% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 4.00% Bond Yields % of Avg. Assets

Conservative bond portfolio

Balance Sheet

27

Portfolio: December 31, 2015

Total Investments $ 967 million Unrealized Gain (Loss) $ 4.6 million QTD Purchases $ 78.2 million QTD Sales $ 64.0 million Duration Avg Yield – TE 4Q15 3.0% 2.5% 3Q15 2.8% 2.6% 2Q15 2.9% 2.6% 1Q15 2.9% 2.8% 4Q14 2.8% 2.8% 3Q14 3.0% 2.9% 11.6% 1.0% 54.1% 7.6% 6.1% 18.3%

Agency Corporates MBS Asset Backed CMOs Municipals

As of 12/31/2015 Book Yield Avg Life (yrs) Agency 2.41% 8.6 Asset Backed 1.64% 4.7 Corporates 3.73% 3.1 CMOs 1.73% 3.5 MBS 2.34% 4.9 Municipals 4.69% 3.5 Total 2.45% 4.9

• Investment portfolio at $967 million, up $138

million vs Dec 2014

• Increase due to Magna/CMBT purchase
• MBS sector at 54% of portfolio
• Duration stable at low levels
• Investments to Total Assets of 11.1% as of 12/31

77% 23% Muni Allocation % General Obligation Bonds Revenue Bonds

The municipal portfolio contains minimal risk

Balance Sheet

28 Location # of Issuances Market Value % Tennessee 72 $40,649 20.7% Michigan 6 3,559 1.8% Illinois 20 14,897 7.6% Other – 30 states 194 137,522 69.9% Totals 292 $196,627 100.0% As of September 30, 2015 Municipal Bond Portfolio Statistics 4Q15 4Q14 Weighted Average Life 3.5 years 3.6 years Tax equivalent yield 4.69% 4.57% FMV as % of Cost 103.9% 104.7%

All municipals are “A” rated or better.

29

Mergers on Track to Hit Targets

Balance Sheet

CapitalMark Magna As of announcement date April 7, 2015 Updated as of

• Dec. 31, 2015

As of announcement date April 28, 2015 Updated as of

• Dec. 31, 2015

Aggregate Amounts Closing Late 3Q/Early 4Q 2015 31-Jul-15 Late 3Q 2015 1-Sep-15 Consideration 90% Stock, 10% Cash 75% Stock, 25% Cash PNFP share price $ 44.61 $ 53.09 $46.66 $46.32 PNFP shares 3,305,000 3,306,184 1,325,000 1,371,717 4,677,901 Stock option value $ 23,179,000 $ 30,429,000 $ 1,957,000 $ 847,000 Cash consideration $ 16,380,000 $ 19,675,000 $ 18,774,000 $ 19,453,000 Total transaction value $ 187,000,000 $ 225,629,000 $ 82,556,000 $ 83,838,000 $ 309,467,000 SBLF redemption $ 18,212,000 $ 18,212,000 $ 18,350,000 $ 18,350,000 $ 36,562,000 Purchase Accounting Loan mark 2.50% $ (20,500,000) 2.15% $ (17,614,000) 2.00% $ (9,700,000) 2.01% $ (9,737,000) $ (27,351,000) ORE mark 30% $ (1,100,000) 0% $ - 25% $ (800,000) 0% $ - $ - Core deposit intangible 1.50% $ 8,622,000 0.95% $ 5,484,000 1.50% $ 5,400,000 0.52% $ 2,828,000 $ 8,312,000 Cost Savings Aggregate cost saves 30% No change anticipated 25% No change anticipated EPS Accretion 2015 0.0% 0.0% $0.06 to $0.08 2016 2.5% 3.4% 2017 4.5% 4.4% Tangible Book Value Dilution 2.5% Neutral Less than 1%

Supplemental Information

Asset Quality

30

31

Past due loans remain very low

Asset Quality

(*) > 30 days past due (**) includes purchase credit impaired loans

(000’s)

• Dec. 31,

2015 As a % of total loans

• Sept. 30,

2015 As a % of total loans

• Dec. 31,

2014 As a %

• f total

loans Past Due Loans (*) Nonaccrual loans** $10,362 0.16% $8,349 0.13% $7,058 0.15% Accruing loans 19,977 0.31% 21,830 0.34% $18,330 0.40% Total past due $30,339 0.46% $30,179 0.48% $25,388 0.55%

32

NPLs and loans >90 days past due & accruing remain very low

Asset Quality

(000’s) PNFP NPLs and >90 days

• Dec. 31,

2015 As a % of total loans

• Sept. 30,

2015 As a % of total loans

• Dec. 31,

2014 As a % of total loans

• Const. and land development

$7,608 0.12% $8,837 0.14% $5,173 0.11% CRE – Owner Occupied 5,103 0.08% 4,880 0.08% 4,313 0.09% CRE – Investment 718 0.01% 2,965 0.05%

• Total real estate

24,170 0.37% 28,140 0.44% 14,089 0.31% C&I 1,683 0.03% 1,236 0.02% 1,614 0.04% Total loans $31,127 0.48% $35,413 0.56% $17,027 0.37% NPLs Expressed as a % of Total Loans within each Category

33

Asset Quality

Classified assets remain low

(in thousands) Balances

• Dec. 31, 2015

Balances

• Sept. 30, 2015

Balances

• Dec. 31, 2014

Classified loans and ORE:

• Substandard commercial loans

$116,088 $94,801 $102,077

• Doubtful commercial loans

18

• Other impaired loans

19,402 22,490 5,162

• 90 days past due and accruing (*)

1,768 5,364 322

• Other real estate

5,083 4,773 11,186

• Other repossessed assets

1,906 1,022 686 Total $144,265 $128,450 $119,433 Pinnacle Bank classified asset ratio 18.7% 17.1% 18.1%

(*) Includes loans 90 days past due and accruing not included elsewhere

Income Statement Supplemental Information

34

35

Diversified fee structure

Income Statement

2015 Growth - 56.3% Source: Company information

Service charges 15% Investment services 12% Insurance 5% Gains on mortgage loan sales 9% Trust fees 6% BHG income 24% Other 29%

Noninterest Income by Source

Income Statement

Mortgage volumes experience growth in “purchase money” transactions

36 1.59% 2.19% 0.00% 1.00% 2.00% 3.00% 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 Purchase Money Refinance Gross fees as a % of loans originated

Income Statement

37 4Q15 3Q15 2Q15 1Q15 4Q14 Net interest income $71,475 $62,059 $51,831 $51,269 $50,313 Total non-interest income $26,608 $21,410 $20,019 $18,493 $14,384 Less: Securities (gains) losses 10

• (556)

(6)

• Non-interest income, excluding the impact of net gains

(losses) on sale of investment securities $26,618 $21,410 $19,463 $18,487 $14,384 Total non-interest expense $52,191 $45,107 $36,747 $36,831 $34,391 Less: ORE expenses 99 (686) (115) 395 (630) FHLB prepayment charges

• 479
• Merger related expenses

2,489 2,249 59

• Non-Interest expense, excluding ORE expense, FHLB

prepayment charged and merger related expenses $49,603 $43,544 $36,324 $36,436 $35,021 Adjusted pre-tax pre-provision income $48,490 $39,925 $34,970 $33,320 $29,676 Efficiency ratio** 50.6% 52.2% 50.9% 52.2% 54.1%

Reconciliation of Non-GAAP measures

**: Excluding ORE expense, FHLB prepayment charges, merger related expenses and securities gains and losses

Income Statement

38 4Q15 3Q15 2Q15 1Q15 4Q14 Total non-interest income $26,608 $21,410 $20,019 $18,493 $14,384 Less: Securities (gains) losses 10

• (556)

(6)

• Non-interest income, excluding the impact of net gains

(losses) on sale of investment securities $26,618 $21,410 $19,463 $18,487 $14,384 Total non-interest expense $52,191 $45,107 $36,747 $36,831 $34,391 Less: ORE expenses 99 (686) (115) 395 (630) FHLB prepayment charges

• 479
• Merger related expenses

2,489 2,249 59

• Non-Interest expense, excluding ORE expense, FHLB

prepayment charges and merger related expenses $49,603 $43,544 $36,324 $36,436 $35,021 Adjusted pre-tax pre-provision income $48,490 $39,925 $34,970 $33,320 $29,676 Total Assets (Quarterly Average)

$8,565,341 $7,514,633 $6,319,712 $6,102,523 $5,855,421

Noninterest income, excluding the impact of net gains (losses) on sale of investment securities/Average Assets 1.23% 1.13% 1.24% 1.23% 0.97% Non-interest expense, excluding ORE expense, FHLB prepayment charges and merger related expenses 2.30% 2.30% 2.31% 2.42% 2.37%

Reconciliation of Non-GAAP measures

Income Statement

39 4Q15 3Q15 2Q15 1Q15 4Q14 Net income $26,854 $24,149 $22,664 $21,843 $18,737 Merger related expenses 2,489 2,249 59

• Tax effect on merger related expenses

(977) (882) (23)

• Net income less merger related expenses

$28,366 $25,516 $22,701 $21,843 $18,737 Basic earnings per share $0.67 $0.64 $0.65 $0.62 $0.54 Adjustment to basic earnings per share due to merger related expenses 0.04 0.03

• Basic earnings per share excluding merger related expenses

$0.71 $0.67 $0.65 $0.62 $0.54 Diluted earnings per share excluding merger related expenses $0.65 $0.62 $0.64 $0.62 $0.53 Adjustment to diluted earnings per share due to merger related expenses 0.04 0.04

• Diluted earnings per share excluding merger related

expenses $0.69 $0.66 $0.64 $0.62 $0.53

Reconciliation of Non-GAAP measures

Pinnacle Financial Partners Profile Supplemental Information

40

PNFP Profile

41

Headquarters: Nashville, TN Founded: 2000 Total assets: $ 8.709 Billion (12/31/15) Shareholders’ equity: $ 1.156 Billion (12/31/15) Offices: 29 in 8 Middle-TN counties 10 in 5 East-TN counties 5 in West-TN

• Avg. daily trading volume **: 192,541 shares

% Institutional ownership: 64.80% (9/30/15)

Recently completed acquisitions will position firm in four great banking markets

**: 50 day average daily volume per NASDAQ.com PNFP CapitalMark Magna

PNFP Profile

42

Name Title Age Years in Banking Industry Years at Pinnacle

• M. Terry Turner

President and Chief Executive Officer 60 37 15 Robert A. McCabe, Jr. Chairman of the Board 65 39 15 Hugh M. Queener Chief Administrative Officer 60 40 15 Harold R. Carpenter, Jr. Chief Financial Officer 56 33 15

• J. Harvey White

Chief Credit Officer/ Knoxville Regional Executive 66 41 6 Joanne B. Jackson Manager, Client Services Group – Nashville 58 40 15

• D. Kim Jenny

Risk Management Officer 61 41 9 William S. Jones Rutherford County Area Executive 56 33 9*

• J. Edward White

Manager, Client Advisory Group – Nashville 63 41 15 Craig Holley Chattanooga Chairman 59 31 ** Kirk Bailey Memphis Chairman 60 35 **

* - Mr. Jones was an executive with Cavalry Bancorp which was acquired by Pinnacle in 2006. ** - Mr. Holley and Mr. Bailey both joined Pinnacle in 2015 following the acquisitions of CapitalMark Bank & Trust and Magna Bank, respectively.

PNFP has an extraordinarily experienced management team

PNFP Profile

• Pinnacle Financial Partners (PNFP)
• Bank of the Ozarks (OZRK)
• Brookline Bancorp, Inc. (BRKL)
• Columbia Banking System, Inc.

(COLB)

• CVB Financial Corp. (CVBF)
• Eagle Bancorp, Inc. (EGBN)
• FCB Financial Holdings, Inc. (FCB)
• First Financial Bancorp. (FFBC)
• First Midwest Bancorp (FMBI)
• Hilltop Holdings Inc. (HTH)
• Independent Bank Corp. (INDB)
• Legacy Texas Financial Group, Inc.

(LXTB)

• MB Financial (MBFI)
• National Penn Bancshares, Inc.

(NPBC)

• Renasant Corporation (RNST)
• South State Bank (SSB)
• Sterling Bancorp (STL)
• Trustmark Corporation (TRMK)
• Union First Market Bkshs Co (UBSH)
• United Bankshares, Inc. (UBSI)
• United Community Banks, Inc.

(UCBI)

• Western Alliance Bancorporation

(WAL)

43

PNFP compares favorably to high performing peers

PNFP Profile

44 Nashville-Davidson-Rutherford MSA Knoxville MSA

Top 10 Market Share Rank Holding Company Market Share 6/30/15 Market Share 6/30/00 (1) % Change in Share Top 10 Market Share Rank Holding Company Market Share 6/30/15 Market Share 6/30/07 (1) Change in Share 4 Pinnacle Financial Partners 9.19% 1.74% 7.45% 6 Pinnacle Financial Partners 4.86% 0.03% 4.83% 1 Bank of America Corp 17.29% 14.59% 2.70% 8 Bank of America Corp. 3.26% 2.00% 1.26% 5 First Horizon National Corp. 6.23% 5.13% 1.10% 9 Clayton HC Inc. 2.06% 1.10% 0.96% 7 Wilson Bank Holding Co. 3.27% 2.34% 0.93% 5 BB&T Corp. 6.37% 6.19% 0.18% 10 Wells Fargo & Co. 2.70% 2.05% 0.65% 2 SunTrust Banks Inc. 16.28% 16.19% 0.09% 9 Fifth Third Bancorp 2.93% 2.29% 0.64% 10 Twin Cities Financial Services Inc. 1.76% 1.96% (0.20)% 8 Franklin Financial Network Inc. 3.11%

• 4

Home Federal Bank of TN 10.31% 10.87% (0.56)% 6 U.S. Bancorp 3.41% 7.35% (3.94)% 1 First Horizon 17.44% 19.11% (1.67)% 3 SunTrust Banks Inc. 12.31% 18.60% (6.29)% 7 United Community Banks Inc. 3.42% 5.30 (1.88)% 2 Regions Financial Corp. 14.25% 29.06% (14.81)% 3 Regions 14.69% 18.25 (3.56)% Other 25.31% 16.87% 8.44% Other 19.56% 19.03% 0.53% Total 100% 100% Total 100% 100%

PNFP has a track record for “best-in-market” share movement

Source: FDIC Summary of Deposits 2015; Amounts reflect aggregation of previously merged banks. (1): First year Pinnacle’s deposits were reflected in FDIC Summary of Deposits data. Market share at 6/30/00 for Nashville reflects impact of Cavalry Bancorp, Inc. which was acquired by Pinnacle in March of 2006.

PNFP Profile

45 Chattanooga TN-GA MSA Memphis, TN-MS-AR MSA

Top 10 Market Share Rank Holding Company Market Share 6/30/15 Market Share 6/30/14 % Change in Share Top 11 Market Share Rank Holding Company Market Share 6/30/15 Market Share 6/30/14 % Change in Share 6 Bank of America Corp. 3.75% 2.67% 40.45% 4 Bank of America Corp. 4.10% 3.45% 18.84% 4 Pinnacle Financial Partners 6.59% 6.01% 9.65% 3 SunTrust Banks Inc. 10.20% 8.77% 16.31% 9 BankCap Equity Fund LLC 3.50% 3.23% 8.36% 1 First Horizon National Corp. 29.87% 26.06% 14.62% 2 SunTrust Banks Inc. 19.42% 18.74% 3.63% 8 Landmark Community Bank 2.04% 1.87% 9.09% 10 Sequatchie Valley Bancshares Inc. 3.27% 3.27% 0.0% 6 Trustmark Corp. 2.85% 2.90% (1.72%) 5 First Volunteer Corp. 4.74% 4.89% (3.07%) 9 Metropolitan BancGroup Inc. 1.98% 2.09% (5.26%) 1 First Horizon National Corp. 23.46% 24.23% (3.18%) 11 Pinnacle Financial Partners 1.65% 1.77% (6.78%) 3 Regions Financial Corp. 13.13% 13.58% (3.31%) 7 Independent Holdings Inc. 2.83% 3.09% (8.41%) 7 SmartFinancial Inc. 3.68% 3.90% (5.64%) 2 Regions Financial Corp. 16.14% 18.36% (12.09%) 8 First South Bancorp Inc. 3.67% 4.32% (15.05%) 5 BancorpSouth Inc. 3.36% 3.90% (13.85%) Other 14.79% 15.15% (2.4%) 10 Wells Fargo & Co. 1.72% 2.01% (14.43%) Total 100% 100.% Other 23.25% 25.74% (9.67%) Total 100%

PNFP has a track record for “best-in-market” share movement

Source: FDIC Summary of Deposits 2015; Amounts reflect aggregation of previously merged banks.

(1): Market share at 6/30/14 for Chattanooga and Memphis reflects impact of the recently completed acquisitions of CapitalMark Bank & Trust and Magna Bank, respectively.

Economic & Market Conditions Supplemental Information

46

PNFP operates in advantaged markets

47

Source: SNL Financial Note: Deposit data is a 2016 ProForma Tennessee Market Demographics 2016 -2021E 2016 -2021E Top 20 MSAs Total Deposits ($Ms) Current Population (000s) Population Growth (%) Current Median HHI ($) Median HHI Growth (%) Nashville-Davidson-Murfreesboro-Franklin TN 48,022 1,840 6.87% 55,922 9.41% Memphis TN-MS-AR 27,064 1,347 2% 49,103 7.88% Knoxville TN 13,585 865 3.35% 47,037 7% Chattanooga TN-GA 8,947 550 3.70% 48,594 7.45% Kingsport-Bristol-Bristol TN-VA 4,404 308 1.15% 41,845 6.39% Clarksville TN-KY 3,356 284 5.62% 50,193 8.67% Johnson City TN 2,610 202 2.07% 38,455 2.09% Jackson TN 2,124 130 1.18% 42,483 5.37% Cookeville TN 2,115 108 2.82% 34,718 8.66% Sevierville TN 1,976 97 5.89% 44,098 4.66% Cleveland TN 1,674 121 4.23% 44,748 13.42% Tullahoma-Manchester TN 1,458 102 2.60% 42,097 5.95% Morristown TN 1,417 116 2.44% 42,092 5.85% Union City TN-KY 1,085 37

• 2.05%

37,825 1.55% Athens TN 918 53 2.12% 40,955 5.15% Crossville TN 915 59 4.18% 39,897 7.66% McMinnville TN 806 40 1.81% 37,017 10.19% Greeneville TN 736 68 0.74% 36,872 5.81% Dyersburg TN 648 38 0.13% 43,718 10.99% Shelbyville TN 620 47 4.96% 43,522 5.77% Tennessee 128,539 6,624 3.82% 46,781 7.13% United States 9,228,740 322,431 3.69% 55,551 7.77%

PNFP operates in advantaged markets

48

TENNESSEE

• Tennessee ranked No. 7 among the 50 states for the quality of its transportation and trade;

U.S. Chamber of Commerce Foundation stood out for high-tech job growth

• Tennessee recorded 8,289 new business filings in the third quarter, indicating gains in

State of Tennessee’s Quarterly Economic Report employment and tax revenue

• Tennessee came in sixth in top state business climate rankings

Site Selection Magazine NASHVILLE Nashville has achieved “it city” status, landing on several major national publications’ lists of hot spots. Nashville’s diverse economy, thriving cultural base and strong business community are major attractions for corporations. The accolades continued in the fourth quarter of 2015:

• Nashville named one of “13 hottest American cities for 2016” for booming growth

Business Insider and a focal point for auto and healthcare industries

• Nashville MSA ranks No. 18 on “Best-Performing Cities” list for creating and sustaining

Milken Institute jobs and economic growth

• Nashville is the newly crowned winner of Travel + Leisure’s readers’ choice for

Travel + Leisure Destination of the Year KNOXVILLE Knoxville also enjoys a very healthy and diverse economy with an excellent transportation and technology infrastructure. The Knoxville metropolitan area was the third fastest MSA in the country to fully recover from jobs lost in the 2007-2010 recession and currently enjoys the lowest unemployment rate of Tennessee’s metro areas. Good news in the fourth quarter of 2015 includes:

• Investment in the Knoxville area from new and expanding business nearly doubled the first

Knoxville Chamber of Commerce 10 months of 2015 to a record $1.28 billion

• Knoxville named No. 7 “Best City for Millennial Entrepreneurs”

ThumbTack.com

• Knoxville named to America’s Best Cities for Global Trade – No. 10 in “Best Global Vibe Cities”

Global Trade Magazine

PNFP operates in advantaged markets

49

MEMPHIS Memphis offers a diverse, metropolitan workforce. Over the past three decades, the presence of companies like FedEx and the region’s superior distribution infrastructure have earned Memphis the title, “America’s Distribution Center.”

• Memphis called the “Edgiest Startup Hub” in the U.S.
• Inc. Magazine
• Memphis claims No. 9 spot of “Top 10 Cities” with the lowest business startup costs

SmartAsset CHATTANOOGA Chattanooga is Tennessee’s fourth-largest MSA as measured by both population and deposits. National publications have declared Chattanooga a tech hub and manufacturing magnet. Economic drivers include:

• Chattanooga offers businesses and individuals the world’s fastest internet at 10 gigabits per second

Wired

• Chattanooga named one of the best places to retire in 2015 for its relatively low taxes, affordable

Wall Street Journal housing and thriving arts scene

50

PNFP operates in advantaged markets

Job growth occurring in all four markets

Source: BERC – Middle Tennessee State University & Bureau of Labor Statistics, Greater Nashville Area Realtors

650,000 700,000 750,000 800,000 850,000 900,000 950,000 Nashville MSA Nonfarm Payrolls- SA (thru November 2015) 330,000 340,000 350,000 360,000 370,000 380,000 390,000 400,000 Knoxville MSA Nonfarm Payrolls- SA (thru November 2015) 210,000 215,000 220,000 225,000 230,000 235,000 240,000 245,000 250,000 255,000 Chattanooga MSA Nonfarm Payrolls- SA (thru November 2015) 560,000 570,000 580,000 590,000 600,000 610,000 620,000 630,000 640,000 650,000 Memphis MSA Nonfarm Payrolls- SA (thru November 2015)

51

PNFP operates in advantaged markets

Rapid job growth leads to rapid real estate absorption

Source: BERC – Middle Tennessee State University & Bureau of Labor Statistics, GNAR, GCAR, MAAR, and KAAR

Home Sales

Nashville Knoxville Memphis Chattanooga 4Q15 % Change from PY 4Q15 % Change from PY 4Q15 % Change from PY 4Q15 % Change from PY

• Avg. Qtrly. Median

Home Price $235.0 11.1% $156.0 4.0% $120.2 2.2% $150.7 5.2% Quarterly Closings 7,046 1.8% 2,260 (24.5%) 3,789 2.1% 2,014 4.1% Quarter end Inventory 7,059 (7.4%) 8,513 2.4% 6,291 (4.4%) 3,623 (23.3%) Months of Inventory* 2.78 (14.2%) 11.6 35.6% 4.7 (1.9%) 5.2 (31.1%)

*: Calculated as quarter end inventory divided by monthly closings 0.00 5.00 10.00 15.00 Unemployment Rates Seasonally Adjusted (thru Nov 2015) Nashville Knoxville Chattanooga Memphis US

Nashville’s commercial vacancy rates indicate a healthy market

PNFP Operates in Advantaged Markets

52

Source: Costar **: prior year comparable not available

CRE Vacancy Rates Nashville Knoxville Chattanooga Memphis National 4Q15 % Change from PY 4Q15 % Change from PY 4Q15 % Change from PY 4Q15 % Change from PY 4Q15 % Change from PY Industrial / Warehouse 5.90% (15.7%) 5.20% (42.2%) 12.10% (0.8%) 9.60% (18.6%) 6.10% 6.9% Multifamily 3.50% (10.7%) 4.50% (11.8%) 5.70% (9.5%) 8.00% (7.0%) 3.70% ** Retail 5.20% (18.8%) 6.00% (13.0%) 6.20% (15.1%) 8.40% (3.5%) 5.60% 6.1% Office 5.30% (20.9%) 7.90% (4.8%) 10.30% 13.2% 11.30% (5.0%) 10.40% 10.9%

Fourth Quarter 2015 Investor Call

• M. Terry Turner, President and CEO

Harold R. Carpenter, EVP and CFO January 20, 2016