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Jun 30, 2022
Pinnacle Financial Q2 2022 Earnings Report
Pinnacle Financial reported diluted EPS of $1.86, ROAA of 1.46% and ROATCE of 17.62% for the second quarter of 2022.
Key Takeaways
Pinnacle Financial Partners, Inc. reported a strong second quarter in 2022, with net income per diluted common share increasing by 10.1% compared to the same period last year. The company experienced significant loan growth, driven by recent market extensions and a focus on recruiting experienced relationship managers. Revenues also saw growth, with net interest income and core fee categories showing double-digit increases.
Annualized linked-quarter loan growth of 29.9% for 2Q2022, 31.9% exclusive of PPP paydowns
New markets contributed almost 25 percent of loan growth this quarter.
Hired 37 additional revenue producers during the second quarter.
Second quarter fee revenues were the best ever experienced.
Forward Guidance
The company expects a more difficult economic landscape in the second half of the year but believes it can outperform even through a more challenging operating environment.
Positive Outlook
- Loan growth is expected to continue driving revenue.
- Anticipate margin expansion in the third quarter.
- Hiring model will continue to provide opportunities to add revenue producers.
- Compensation costs increased due primarily to increased headcount, annual merit raises and higher incentive accruals.
- Believe total 2022 noninterest expense should approximate a mid-teens percentage increase over that of 2021.
Challenges Ahead
- Inflation is prompting urgent action by the Fed and increasing the likelihood of recession.
- Changes in the firm's insufficient funds and overdraft programs announced earlier this month could amount to approximately $2.9 million in reduced service charge revenue annually, or approximately $700,000 on a quarterly basis.
- BHG's decision to place more loans into their auction platform in the second quarter than they would have otherwise anticipated is likely to negatively impact BHG's results in the second half of 2022.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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