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Mar 31, 2024
Pinnacle Financial Q1 2024 Earnings Report
Reported diluted EPS of $1.57, with total revenues increased 32.1 percent linked-quarter annualized and 6.6 percent year-over-year
Key Takeaways
Pinnacle Financial Partners reported a net income per diluted common share of $1.57 for the quarter ended March 31, 2024. Total assets reached $48.9 billion, an increase of approximately $934.3 million from Dec. 31, 2023. The firm recruited 37 new revenue producers during the quarter, including 14 in our newer markets of Atlanta, Washington D.C., Birmingham and Jacksonville.
Allowance for credit losses increased to 1.12 percent of total loans.
Recognized a mortgage servicing asset of approximately $11.8 million associated with its Freddie Mac Small Business Lending (SBL) platform.
Increased other noninterest expense by $7.3 million for a FDIC special assessment.
Recruited 37 new revenue producers during the quarter, including 14 in our newer markets of Atlanta, Washington D.C., Birmingham and Jacksonville.
Pinnacle Financial
Pinnacle Financial
Pinnacle Financial Revenue by Segment
Revenue by Segment
Service Charges Revenue
CapyFin.comInvestment Services Revenue
CapyFin.comInsurance Commissions Revenue
CapyFin.comMortgage Loan Gains Revenue
CapyFin.comTrust Fees Revenue
CapyFin.comOther Noninterest Income Revenue
CapyFin.com Forward Guidance
The firm is modifying its net interest income outlook slightly for the year, believing that they will experience 8 to 10 percent growth in net interest income for this year. Excluding certain impacts, growth in fee revenues should approximate 10 to 14 percent in 2024 over 2023. BHG fee income should approximate a mid-single digit percentage increase in 2024 over the $85.4 million in 2023. The expense outlook is maintained at $950 million to $975 million for the year, exclusive of the impact of the FDIC special assessments incurred in the first quarter and any additional assessments the FDIC may decide to impose this year.
Positive Outlook
- Strong deposit growth during the first quarter, which grew $862.2 million in the quarter, a 9.0 percent linked-quarter annualized growth rate
- End-of-period noninterest-bearing demand deposit accounts grew 2.6 percent linked-quarter annualized after having experienced declining demand deposit volumes for several quarters.
- Core fee revenues should be higher than originally anticipated for 2024.
- Growth in fee revenues should approximate 10 to 14 percent in 2024 over 2023.
- BHG's ability to access the capital markets to secure incremental funding through securitizations of its held-for-investment loan portfolio has contributed to additional flexibility for BHG to fund its operations.
Challenges Ahead
- Inflation appears to be more difficult to tame than the Fed had predicted
- Loans grew at an annualized rate of 6.0 percent, which is slightly below what is expected for all of 2024.
- Net charge-offs for the firm may range between 0.20 percent and 0.25 percent of average loans for 2024.
- BHG's first quarter was impacted by the successful completion of their ninth securitization issuance of approximately $300 million.
- Maintaining expense outlook at $950 million to $975 million for the year, exclusive of the impact of the FDIC special assessments we incurred in the first quarter and any additional assessments the FDIC may decide to impose this year.