Pinnacle Financial Partners(US:PNFP)2022-07-20 20:10Financial Data and Key Metrics Changes - The second quarter was highlighted as a strong financial performance period, with significant loan growth of 32% annualized and a notable increase in net interest income due to rising loan yields [33][64][73] - The company reported a tangible book value increase to $42.08 from $41.65 in the previous quarter, reflecting strong financial health [81] Business Line Data and Key Metrics Changes - Loan growth was driven by new markets and the hiring of experienced relationship managers, contributing approximately $530 million in loan growth from new markets and $430 million from new relationship managers [67][70] - Deposit growth slowed in the second quarter but rebounded in the latter half, particularly in noninterest-bearing deposits, which are valuable as rates increase [34][70] Market Data and Key Metrics Changes - The company anticipates continued loan growth in the high teens to low 20s percentage for the full year 2022, with expectations for further increases in loan yields as rate hikes continue [81][82] - The overall economic backdrop is challenging, but the company remains optimistic about its growth trajectory and market position [67][82] Company Strategy and Development Direction - The management emphasized a strong focus on culture and hiring top talent as key drivers for long-term shareholder value, with a 60% increase in revenue producers since 2019 [41][60] - The company aims to continue expanding its market share and enhancing its competitive advantage through strategic hiring and maintaining high asset quality [60][62] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate a potentially difficult credit environment, citing strong asset quality metrics and proactive management of the loan portfolio [18][75] - The outlook for net interest income growth remains positive, with expectations for continued improvement in the second half of the year [73][82] Other Important Information - The company highlighted the unique funding model of BHG, which provides significant hidden equity and flexibility in accessing funding compared to competitors [14][84] - Management noted that the average earnings of BHG borrowers are approximately $287,000 annually, indicating a strong credit profile [90] Q&A Session Summary Question: Deposit growth and its potential for acceleration - Management is optimistic about deposit growth in the second half of the year, traditionally seeing stronger growth during this period, especially from new recruits in new markets [99] Question: Loan-to-deposit ratio and cash levels - Management believes there is room to reduce cash as a percentage of assets and aims to approach historical loan-to-deposit ratios of 95% to 98% [100]