U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 29549
----------------------
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR QUARTERLY PERIOD ENDED MARCH 31, 1999
Commission File Number 33-67528
--------
PINNACLE FINANCIAL CORPORATION
(Exact name of small business issuer as specified in its charter)
Georgia 58-1538862
- ------------------------------- ----------
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization Number)
884 Elbert Street,
P.O. Box 430, Elberton, Georgia 30635-0430
- ------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Issuer=s telephone number, including area code: (706) 283-2854
---------------
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes X No
--- ---
State the number of shares outstanding of each of the issuer=s classes of
common equity, as of the latest practicable date:
As of April 30, 1999 there were 768,000 shares of common stock outstanding.
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PINNACLE FINANCIAL CORPORATION
INDEX
Page No.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets at
March 31, 1999 and December 31, 1998 1
Consolidated Statements of Income for the Three
Months ended March 31, 1999 and 1998 2
Consolidated Statements of Cash Flows for the
Three Months Ended March 31, 1999 and 1998 3
Item 2. Managements Discussion and Analysis or Plan of
Operation 5
PART II - OTHER INFORMATION 11
I
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PINNACLE FINANCIAL CORPORATION
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
II
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<PAGE>
PINNACLE FINANCIAL CORPORATION & SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
MARCH 31, 1999 AND DECEMBER 31, 1998
(Unaudited)
<TABLE>
<CAPTION>
MARCH 31 DECEMBER 31,
1999 1998
<S> <C> <C>
ASSETS
- ------
Cash and due from banks $7,359,984 $10,083,914
Federal funds sold 11,450,000 7,150,000
Securities available for sale 93,561,026 92,807,286
Loans, net of allowance for credit losses
of $2,099,071 and $2,070,005, respectively 141,220,267 142,025,057
Premises and equipment 8,516,938 8,636,788
Accrued interest receivable 2,590,727 2,653,111
Foreclosed real estate 425,845 495,566
Other assets 1,693,495 1,335,761
------------ ------------
Total assets $266,818,282 $265,187,483
============ ============
LIABILITIES
- -----------
Demand deposits $41,065,256 $41,417,077
Savings and NOW deposits 69,388,224 67,996,928
Other time deposits 111,862,038 111,527,553
------------ ------------
Total deposits 222,315,518 220,941,558
Federal funds purchased 0 0
Accrued interest and other liabilities 3,629,312 3,598,216
------------ ------------
Total liabilities 225,944,830 224,539,774
------------ ------------
SHAREHOLDERS' EQUITY
- --------------------
Common stock, $10 par value; 5,000,000 shares
authorized, 768,000 shares issued and outstanding 7,680,000 7,680,000
Capital surplus 7,280,000 7,280,000
Retained earnings 25,430,023 24,669,429
Accumulated other comprehensive income 483,429 1,018,280
------------ ------------
Total shareholders' equity 40,873,452 40,647,709
------------ ------------
Total liabilities and shareholders' equity $266,818,282 $265,187,483
============ ============
The accompanying notes are an integral part of these financial statements.
</TABLE>
1
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PINNACLE FINANCIAL CORPORATION & SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
(Unaudited)
<TABLE>
<CAPTION>
YTD YTD
MARCH 31, MARCH 31,
1999 1998
<S> <C> <C>
INTEREST INCOME
- ---------------
Loans $3,509,840 $3,678,768
Securities available for sale 1,406,546 1,297,051
Federal funds sold 95,782 84,810
---------- ----------
Total interest income 5,012,168 5,060,629
---------- ----------
INTEREST EXPENSE
- ----------------
Deposit 1,889,985 1,965,818
Fed Funds Purchased 0 267
---------- ----------
Total interest expense 1,889,985 1,966,085
---------- ----------
NET INTEREST INCOME 3,122,183 3,094,544
Provision for credit losses 75,000 75,000
---------- ----------
Net interest income after provision for credit losses 3,047,183 3,019,544
---------- ----------
OTHER INCOME
- ------------
Service charges on deposit accounts 332,055 330,069
Other service charges and fees 230,393 200,299
Net realized gains on sales of securities available for sale 0 85
Other income 34,397 56,433
---------- ----------
Total other income 596,845 586,886
---------- ----------
OTHER EXPENSES
- --------------
Salaries and employee benefits 1,167,191 1,115,488
Occupancy expense 281,790 247,967
Net realized losses on sales of securities available for sale 0 0
Other expenses 455,053 427,534
---------- ----------
Total other expenses 1,904,034 1,790,989
---------- ----------
Income before income taxes 1,739,994 1,815,441
Income tax expense 557,000 582,155
---------- ----------
NET INCOME $1,182,994 $1,233,286
========== ==========
Net income per share of common stock $1.54 $1.61
===== =====
Average shares outstanding 768,000 768,000
======= =======
The accompanying notes are an integral part of these financial statements.
</TABLE>
2
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PINNACLE FINANCIAL CORPORATION & SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
(Unaudited)
<TABLE>
<CAPTION>
MARCH 31, MARCH 31,
1999 1998
<S> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES
Net income 1,182,994 $1,233,286
Adjustments to reconcile net income to net
Cash provided by operating activities:
Depreciation and amortization 147,579 122,241
Provision for credit losses 75,000 75,000
Net realized losses on securities available for sale 0 0
Increase in accrued interest and other assets (225,629) (210,484)
Increase in accrued expenses and other liabilities 31,096 556,193
---------- ----------
Total adjustments 28,046 542,950
---------- ----------
Net cash provided by operating activities 1,211,040 1,776,236
CASH FLOWS FROM INVESTING ACTIVITIES
Net increase in federal funds sold (4,300,000) (4,372,830)
Purchase of securities available for sale (9,154,900) (10,703,893)
Proceeds from sales of securities available for sale 0 0
Proceeds from maturities of securities available for sale 7,867,863 7,155,650
Net (increase) decrease in loans 729,790 412,163
Purchases of premises and equipment (29,283) (208,718)
---------- ----------
Net cash used by investing activities (4,886,530) (7,717,628)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase in non-interest bearing demand deposits,
Savings and NOW deposit accounts 1,039,475 4,203,847
Net increase in time deposits 334,485 (306,544)
Net decrease in federal funds purchased 0 (360,000)
Dividends paid (422,400) (384,000)
---------- ----------
Net cash provided by financing activities 951,560 3,153,303
---------- ----------
Net decrease in cash and due from banks (2,723,930) (2,788,089)
Cash and due from banks at January 1 10,083,914 10,789,675
---------- ----------
Cash and due from banks at March 31 $7,359,984 $8,001,586
========== ==========
Interest paid $1,971,274 $1,808,566
========== ==========
Income taxes paid $1,303 $8,928
====== ======
The accompanying notes are an integral part of these financial statements.
</TABLE>
3
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PINNACLE FINANCIAL CORPORATION AND SUBSIDIARY
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
(1) BASIS OF PRESENTATION
---------------------
The consolidated financial statements include the accounts of Pinnacle
Financial Corporation (the Company), a bank holding company, and its
wholly-owned commercial bank subsidiary, Pinnacle Bank, N.A. Pinnacle Bank,
N. A., is the surviving institution following the January 1, 1998
consummation of the merger of Pinnacle Bank, National Association (formerly
First National Bank in Elberton) and Pinnacle Bank (formerly Tri-County Bank
of Royston). All significant intercompany accounts have been eliminated in
consolidation.
In the opinion of management, the accompanying unaudited consolidated
financial statements contain all adjustments (consisting only of normal
recurring adjustments) necessary for fair presentations of the consolidated
financial position and the results of operations of the Company for the
interim periods. Certain reclassifications have been made to the prior year
presentation to conform to the current year. The results of operations for
the three-month period ended March 31, 1999 are not necessarily indicative
of the results which may be expected for the entire year.
(2) INCOME TAXES
------------
Deferred income taxes are recorded as required by FAS No. 109,
"Accounting for Income Taxes," using the liability method under which
deferred tax assets and liabilities are determined based on the differences
between the financial accounting and tax basis of assets and liabilities.
(3) ACCOUNTING FOR IMPAIRED LOANS
-----------------------------
FAS 114, "Accounting by Creditors for Impairment of a Loan" was adopted
as of January 1, 1995 as required. Loans having carrying values of
$1,345,000 as of March 31, 1999 have been recognized as impaired in
conformity with FAS 114. The total allowance for credit losses related to
the impaired loans is $638,000. For impairment recognized in conformity
with FAS 114, the entire change in the present value of expected cash flows
is reported as bad debt expense in the same manner in which the initial
impairment was recognized or as a reduction in the amount of bad debt
expense that otherwise would be reported. The company has recognized
specific allowances in prior periods for each of these loans based on
previous methodology for calculating its allowance for credit losses.
4
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ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN
OF OPERATION
Management's Discussion and Analysis or Plan of Operation of
Pinnacle Financial Corporation (hereinafter "Pinnacle" or the "Company")
analyzes the major elements of Pinnacle's consolidated balance sheets and
statements of income. This section reflects the results of its wholly-owned
subsidiary bank, Pinnacle Bank, N.A. (hereinafter the "Bank").
Pinnacle continues to weigh the merits of additional business
combinations while maintaining a focus on its general mission to responsibly
serve the needs of its customers and communities and to enhance profit
potential and shareholder value.
For a comprehensive presentation of Pinnacle's financial condition
and results of operations, the following analysis should be viewed along
with other information contained in this report, including the unaudited
financial statements and accompanying disclosures. All amounts throughout
this section are rounded to the nearest 1,000 dollars, the nearest .1
million dollars and to the nearest .1 percent to represent approximations of
reported amounts.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The objective of liquidity management is to maintain cash flows
adequate to meet immediate and ongoing needs of credit demand, deposit
withdrawal, maturing liabilities and corporate operating expenses. Pinnacle
seeks to meet liquidity requirements primarily through the management of
federal funds and the investment securities portfolio. At March 31, 1999,
8.2% of the investment securities portfolio had maturity dates within the
next year and an additional 68.3% matures within the next five years. All
investment securities are classified as available for sale and may be sold
or used as a source of collateralized borrowings in the event of a liquidity
shortfall. Other sources of liquidity are payments on commercial and
installment loans and repayment of maturing single payment loans. Also,
Pinnacle retains relationships providing short term unsecured borrowings
with four correspondent banks which could provide up to $5.3 million on
short notice, if needed. Pinnacle's management intends to continue to
closely monitor and maintain appropriate levels of interest-bearing assets
and liabilities in future periods so that maturities of assets are such that
adequate funds are provided to meet customer withdrawals and loan requests
while net interest margins are maximized.
Regulatory policy generally requires the maintenance of a
liquidity ratio of 25%, which is generally defined as cash plus liquid
investments divided by deposits plus borrowings due within one year. The
desired level of liquidity is determined by management based in part on
Pinnacle's commitment to make loans and an assessment of its ability to
generate funds. At March 31, 1999, the liquidity ratio for Pinnacle was
42%.
5
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Management continues to give priority to the importance of
maintaining high levels of assets with interest rate sensitivity. Cash and
cash equivalents increased during the first three months of 1999 from
December 31, 1998 levels by $1.6 million and securities available for sale
increased by $1.0 million or .7 % from December 31, 1998 to March 31, 1999.
The average balance in these investment securities increased by $10.7
million in the current quarter compared to the quarter ended March 31, 1998.
The average balance of Federal Funds sold during the first three months of
1999 was $8.1 million.
Total interest-bearing assets increased by $4.2 million or 1.7%
for the current period when compared with December 31, 1998. Average net
loans for the bank decreased $1.6 million (1.1%) to $141.2 million in the
three months ended March 31, 1999 from the same 1998 period, primarily as a
result of increased competition and reduced loan demand in Northeast
Georgia.
The allowance for credit losses is established by management at a
level estimated to be adequate to absorb losses inherent in the loan
portfolio. The allowance was unchanged at $2.1 million at March 31, 1999
and December 31, 1998. The Bank experienced loan charge-offs of $103,000 in
the three months ended March 31, 1999 compared to $33,000 in the same period
of 1998. Net charge-offs amounted to $46,000 in 1999 compared to net
recoveries of $19,000 for the three months ended March 31, 1998. The
allowance for credit losses represents 1.5% of total loans outstanding at
March 31, 1999.
As a result of the sale of one property in the three months ending
March 31, 1999, other real estate owned decreased by $70,000 to $426,000 at
March 31, 1999 compared to $496,000 at December 31, 1998. The accrual of
interest has been discontinued on loans totaling $67,000 as of March 31,
1999 representing .1% of total loans compared to $139,000 at December 31,
1998. The effect on interest income for the quarter ended March 31, 1999
was $2,000. Non-accrual loans at March 31, 1999 are classified as: real
estate, $15,000 and unsecured loans, $52,000.
Pinnacle continues to maintain a concentration of core deposits
from an established customer base which provides a stable funding source.
Deposits increased $1.4 million to $222.3 million at March 31, 1999 from
$220.9 million at December 31, 1998, due primarily to normal growth and
continued economic expansion in Northeast Georgia. Non-interest bearing
deposits decreased $.4 million to $41.1 million from December 31, 1998.
Interest bearing deposits increased $1.7 million for the three months ended
March 31, 1999.
Shareholders' equity increased $225,000 to $40.9 million at March
31, 1999 from $40.6 million at December 31, 1998. Earnings retained during
the three months amounted to $761,000 while equity decreased $535,000 as a
result of a decrease in net unrealized gains during the first three months
due to a decrease in values in the bond market.
Pinnacle continues to maintain adequate capital ratios (see "Risk
Based Capital Ratios" and "Results of Operations" below for discussion of
6
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<PAGE>
dividend levels.) Pinnacle maintained a level of capital, as measured by
its average equity to average assets ratio, of 15.4% during the first three
months of 1999, compared to 15.04% for the year which ended December 31,
1998.
Management is not aware of any trends, events or uncertainties
that are reasonably likely to have a material effect on the registrant's
liquidity, capital resources, or results of operation. Pinnacle is not
aware of any current recommendations by the regulatory authorities which, if
they were implemented, would have such an effect. Loans classified for
regulatory purposes as loss, doubtful, substandard or special mention do not
represent trends or uncertainties which management reasonably expects will
materially impact future operational trends.
RESULTS OF OPERATIONS
- ---------------------
Pinnacle's operating results depend primarily on the earnings of
the bank. Its earnings depend to a large degree on net interest income, the
difference between the interest income received from investments (such as
loans, investment securities, federal funds sold, etc.) and the interest
expense paid on deposits and borrowings.
Interest income on interest bearing assets decreased by $48,000
from the same quarter in 1998 as a decline in average yield from 8.8% to
7.9% offset an increase in average earning assets in the first quarter of 1999
as compared to 1998. The decline in yield reflects a general decline in
interest rates as well as an increased percentage of funds invested in lower
yielding investment securities and federal funds sold. Interest expense
declined by $76,000 from the same quarter of 1998 in spite of increased
deposits as a result of increased non-interest bearing deposits and lower
interest rates paid on all deposit accounts. Consequently, net interest
income in the three months ended March 31, 1999 increased $28,000, or 1.4%
as compared to the same period for the previous year. Management continues
to match rate sensitive assets with rate sensitive liabilities in such a way
that net interest margins have increased from the same period the prior
year.
The provision for credit losses is the charge to operating
expenses that management believes is necessary to fund the allowance for
credit losses. The provision reflects management's estimate of potential
loan losses and the creation of an allowance adequate to absorb losses
inherent in the portfolio. Pinnacle provided $75,000 for loan losses in
both quarters ended March 31, 1999 and 1998.
Other operating expenses for Pinnacle increased by $113,000 to
$1.9 million during the three months ended March 31, 1999 compared to $1.8
for the same period in 1998.
Pinnacle's income tax expense decreased $25,000 for the quarter
compared to the same period in the previous year as a result of decreased
7
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taxable income. The effective income tax rate during the quarter of 32.0%
is unchanged from the same quarter in 1998.
Results of operations can be measured by various ratio analyses.
Two widely recognized performance indicators are return on average equity
and return on average assets. Net income during the three months ended
March 31, 1999 was $1.2 million and represents annualized returns of 11.6%
on average shareholders' equity and 1.8% on average assets. Comparable
amounts during the same period of 1998 were $1.2 million, 13.2% and 1.9%,
respectively.
Dividends declared during the first three months of 1999 increased
$.05 per share to $.55 from $.50 per share during the same period of 1998.
YEAR 2000
- ---------
Generally, the year 2000 risk involves computer programs and
computer hardware that are not able to perform without interruption into the
year 2000. The arrival of the year 2000 poses a unique worldwide challenge
to the ability of all systems to correctly recognize the date change from
December 31, 1999 to January 1, 2000. If Pinnacle's systems do not
correctly recognize such a date change, computer applications that rely on
the date field could fail or create erroneous results. Such errors could
affect interest, payment or due dates or could cause the temporary inability
to process transactions, send invoices or engage in similar normal business
activities. If it is not adequately addressed by Pinnacle or its suppliers
and borrowers, the year 2000 issue could result in a material adverse impact
on Pinnacle's financial condition, liquidity and results of operations.
PINNACLE'S STATE OF READINESS. Pinnacle is proceeding on a plan
that will assure the Bank of being ready to process in the year 2000. The
plan involves five phases consisting of awareness, assessment, renovation,
validation and implementation for hardware and software in both information
technology systems ("IT") and non-information technology systems ("non-IT")
that are potentially affected by the year 2000. Pinnacle has completed the
awareness and assessment phases and all critical business systems have been
renovated. Renovation of non-critical systems will continue throughout 1999.
The validation (testing) phase is substantially complete and is expected to
be completed by June 1999. The implementation phase is occurring as each
system passes through the testing procedures and will continue throughout
1999. Modifications and upgrades are performed on the majority of
Pinnacle's existing systems by third-party vendors as Pinnacle provides no
internal programming.
COST TO ADDRESS THE YEAR 2000 ISSUES. In 1997 and 1998, Pinnacle
made substantial investments in technology in the normal course of business
to enhance operational efficiency that included remediation of many of its
year 2000 issues. The cost of assuring readiness to process in the year
2000 has been budgeted to not exceed $40,000 for the years 1998 through
2000, not including the investments in technology referred to above nor the
8
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time associated with existing employee development and implementation of
Pinnacle's year 2000 plan. Approximately 25% of this amount was expensed in
1998 with the remainder of the expenses to be incurred in 1999. The
majority of costs associated with hardware and software enhancements to make
Pinnacle's systems year 2000 compliant are covered in the annual maintenance
fees paid to its vendors. Any unexpected costs that may arise during
implementation in excess of the budgeted amounts will be reported to the
board of directors.
RISKS OF THIRD-PARTY YEAR 2000 ISSUES. The impact of year 2000
non-compliance by outside parties with whom Pinnacle transacts business
cannot be accurately estimated. In addition to the review of IT providers
discussed above, Pinnacle has surveyed major borrowers for year 2000
compliance and has prepared a detailed assessment of the risk associated
with each borrower's inability to be compliant. In addition, all primary
non-IT vendors and suppliers have responded to inquiries regarding year 2000
compliance. Ongoing communication with these primary vendors and suppliers
is anticipated throughout 1999. At this time, no material impact on
Pinnacle's operations from vendor non-compliance is anticipated. Pinnacle
relies upon the Federal Reserve System for electronic funds transfers and
check clearing and understands that its systems have been upgraded to be
year 2000 compliant. Initial testing of the Federal Reserve systems have
been completed and additional tested will be performed through the third
quarter of 1999. If the Federal Reserve does not successfully complete all
modifications required by the date change and is forced to interrupt
services to Pinnacle, Pinnacle could experience significant difficulties.
Pinnacle continues to host educational seminars and provide
meaningful information to customers and community groups regarding risks and
solutions for appropriate activities to plan for Year 2000 uncertainties and
providing assistance on prudent activities to be taken.
PINNACLE'S CONTINGENCY PLANS. Pinnacle will complete contingency
plans by June 1999 for any items found non-compliant after testing. Each
plan will have a trigger date for implementation. These plans will provide
detailed directions in the event an item continues to be non-compliant after
testing, including a replacement vendor or product and an implementation
date. Pinnacle will also complete by September 1999 a general business
resumption plan that will provide detailed directions for continued
operation in case one or more mission critical items fails due to year 2000
related issues so that Pinnacle will be able to recover from any critical
system failures within an acceptable time frame.
9
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The following tables present Pinnacle's regulatory capital position at March
31, 1999:
(Rounded to the nearest thousand)
Total Risk Adjusted Assets $163,108
Risk Based Capital Ratios:
TIER 1 CAPITAL
Common stock $7,680 4.71%
Surplus 7,280 4.46%
Retained Earnings 25,430 15.59%
-------- ------
Total Tier 1 capital 40,390 24.76%
Tier 1 minimum requirement 6,522 4.00%
-------- ------
Excess (shortfall) $33,868 20.76%
======== ======
TIER 2 CAPITAL
Tier 1 from above $40,390 24.76%
Allowance for loan losses, limited to 1.25%
of risk weighted assets 2,039 1.25%
-------- ------
Total Tier 2 capital 42,429 26.01%
Tier 2 minimum requirement 13,044 8.00%
-------- ------
Excess (shortfall) $29,385 18.01%
======== ======
LEVERAGE RATIO
Tier 1 capital $40,390 15.22%
Minimum requirement 10,615 4.00%
-------- ------
Excess (shortfall) $29,775 11.22%
======== ======
Average total assets, net of goodwill $265,385
========
10
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PINNACLE FINANCIAL CORPORATION
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Pinnacle is not aware of any material pending legal proceedings to
which Pinnacle or its subsidiary is a party or to which any of their
property is subject.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On March 9, 1999 the Registrant held its annual meeting of
Shareholders where the following directors were elected at the meeting for
one year terms:
L. Jackson McConnell ** James E. Purcell **
Lint W. Eberhardt Maurice Bond **
L. Jackson McConnell, Jr. Steve Williams
Robert H. Hardy ** H. Thomas Brown
Charles Bradshaw William F. Grant **
Calvin Hill ** Robert E. Lee, III
J. Daniel McAvoy Anderson Dilworth
Don C. Fortson
604,284 Shares (79% of eligible shares) were cast. The ** symbol
after a director's name indicates that 1,248 shares (less than 1%) voted in
opposition to their election. All others received favorable votes on all
ballots cast. There were no broker non-votes cast.
ITEM 5 OTHER INFORMATION
None.
ITEM 27. EXHIBITS AND REPORTS ON FORM 8-K
Exhibit 27 - Financial Data Schedule (for SEC use only).
11
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
PINNACLE FINANCIAL CORPORATION
Date: May 12, 1999 By: /s/ L. Jackson McConnell
------------ -------------------------------
L. Jackson McConnell
Chairman and Chief Executive Officer
(Principal Executive and Financial Officer)
Date: May 12, 1999 By: /s/ James E. Purcell
------------ --------------------------------
James E. Purcell
President and Chief Credit Officer
12
<TABLE> <S> <C>
<ARTICLE> 9
<CIK> 0000910678
<NAME> PINNACLE FINANCIAL CORPORATION
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 7,359,984
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 11,450,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 93,561,026
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 141,220,267
<ALLOWANCE> 2,099,071
<TOTAL-ASSETS> 266,818,282
<DEPOSITS> 222,315,518
<SHORT-TERM> 0
<LIABILITIES-OTHER> 3,629,312
<LONG-TERM> 0
0
0
<COMMON> 7,680,000
<OTHER-SE> 33,193,452
<TOTAL-LIABILITIES-AND-EQUITY> 266,818,282
<INTEREST-LOAN> 3,509,840
<INTEREST-INVEST> 1,502,328
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 5,012,168
<INTEREST-DEPOSIT> 1,889,985
<INTEREST-EXPENSE> 1,889,985
<INTEREST-INCOME-NET> 3,122,183
<LOAN-LOSSES> 75,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,904,034
<INCOME-PRETAX> 1,739,994
<INCOME-PRE-EXTRAORDINARY> 1,182,994
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,182,994
<EPS-PRIMARY> 1.54
<EPS-DILUTED> 1.54
<YIELD-ACTUAL> 7.9
<LOANS-NON> 67,400
<LOANS-PAST> 181,927
<LOANS-TROUBLED> 194,282
<LOANS-PROBLEM> 1,344,795
<ALLOWANCE-OPEN> 2,070,005
<CHARGE-OFFS> 103,074
<RECOVERIES> 57,140
<ALLOWANCE-CLOSE> 2,099,071
<ALLOWANCE-DOMESTIC> 638,000
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 1,461,071
</TABLE>
