What Management Said
Read the full Q4 2025 transcript ↗President and Chief Executive Officer Kevin Blair will discuss our newly combined company's future and outline our 2026 financial outlook. Pinnacle's focus is producing strong, above-peer revenue, earnings per share, and tangible book value growth. These priorities enable us to attract and retain revenue producers at an outsized pace, fueling our continued growth. By pursuing these goals with passion and purpose across the entire franchise, we strive to continue to create exceptional value for our shareholders and set the standard for growth and profitability in the industry.
Legacy Pinnacle grew adjusted diluted earnings per share by 22% in 2025, while legacy Synovus grew adjusted diluted earnings per share by 28%. We are a competitive team committed to sustaining top quartile growth and profitability. These achievements highlight our strategic focus and reinforce a solid foundation for continued growth and operational excellence. This long-standing, successful practice helps teams align around core priorities, promotes cross-team collaboration, and establishes shared ambitions and goals around growth, hiring, pipeline activities, and service expectations.
Pinnacle's exceptional operating model is our foundation and the engine of our growth, guiding us through every opportunity and challenge. Pinnacle reported fourth quarter adjusted EPS of $2.24, which was stable quarter over quarter and up 18% from the prior year. Period-end loans grew at a strong 3% from the prior quarter and 10% year over year, driven by recruiting, particularly in our expansion geographic markets. Core deposit growth was also quite healthy at 3% quarter over quarter and 10% year over year.
What went well
- Legacy Pinnacle grew adjusted diluted earnings per share by 22% in 2025 while legacy Synovus grew adjusted diluted EPS by 28%, demonstrating strong performance through more volatile economic times amid a pending merger.
- Pinnacle reported fourth quarter adjusted EPS of $2.24, stable quarter over quarter and up 18% from the prior year, with net interest income up 3% sequentially and 12% year over year.
- Pinnacle's period-end loans grew a strong 3% from the prior quarter and 10% year over year, and core deposits grew 3% quarter over quarter and 10% year over year, driven by recruiting.
- Synovus reported fourth quarter adjusted diluted EPS of $1.45, stable sequentially and up 16% year over year, with the net interest margin expanding four basis points to 3.45%.
- Synovus adjusted non-interest revenue grew 6% sequentially and 16% year over year to $144 million, highlighted by $16 million of capital markets fees, up 30% year over year.
- The merger between Pinnacle and Synovus was completed on January 1, just 160 days after announcement, demonstrating swift and effective integration.
- Both firms hired 41 new revenue producers in the fourth quarter, bringing the total to 217 for both firms together in 2025.
- A securities repositioning sold and repurchased approximately $4.4 billion of the legacy Synovus portfolio at an average yield of 4.7%, supporting the Level 1 HQLA position, reducing risk-weighted assets, and eliminating approximately 98% of the securities purchase accounting accretion.
- Synovus ended the year with a Common Equity Tier 1 ratio at an all-time high of 11.28% and Pinnacle at 10.88%, as both prepared for the merger closing.
- Both firms retained leading client loyalty, with legacy Pinnacle holding the number one Net Promoter Score in its footprint and legacy Synovus number three among top market share banks.
What went wrong
- Pinnacle's fourth quarter net charge-offs were $27 million, or 28 basis points, of which 63% came from a single non-owner-occupied CRE loan.
- Pinnacle's adjusted non-interest revenue declined 6% from the third quarter.
- The firm pushed back its year-one merger cost savings recognition from 50% to 40% for 2026, as the fast January 1 close outpaced systems work and the firm leaned into best-in-class benefits on both sides.
- The merger math became a slight headwind because interest rates declined, lowering both the purchase accounting accretion and the mark on the Synovus book versus original expectations.
- First quarter capital accretion is expected to be limited due to merger expenses, so no share repurchases are expected in the first quarter and are unlikely in the second quarter.
Guidance Changes
| Metric | Period | Current guidance |
|---|---|---|
| Year-one merger cost savings realized | FY2026 | 40% or $100 million of annualized savings |
| Period-end loans | FY2026 | $91-$93 billion, up 9%-11% versus combined year-end 2025 |
| Total deposits | FY2026 | $106.5-$108.5 billion, up 8%-10% |
| Adjusted revenue | FY2026 | $5 billion-$5.2 billion |
| Net interest margin | FY2026 | 3.45%-3.55% |
| Adjusted non-interest revenue | FY2026 | approximately $1.1 billion, including $125-$135 million BHG investment income |
| Adjusted non-interest expense | FY2026 | approximately $2.7-$2.8 billion |
| Non-recurring merger-related and LFI expense (of $720 million total) | FY2026 | $450-$500 million to be incurred in 2026, excluding equity acceleration cost |
| Net charge-offs | FY2026 | 20-25 basis points |
| CET1 ratio target | FY2026 | 10.25%-10.75% |
| Quarterly common dividend | FY2026 | $0.50 per share beginning first quarter |
| Share repurchase authorization | FY2026 | $400 million program authorized |
| Effective tax rate | FY2026 | approximately 20%-21% |
| Revenue producer hiring goal | FY2026 | 250 total revenue producers |
| Estimated CET1 at end of first quarter 2026 | Q1 2026 | approximately 10% (9.8% including AOCI) |
Performance Breakdown
| Metric | YoY | Note |
|---|---|---|
| Pinnacle adjusted EPS | +18% | Strong balance sheet growth and net interest income; full-year 2025 adjusted EPS up 22% |
| Synovus adjusted EPS | +16% | Healthy loan, core deposit, and non-interest revenue growth; full-year 2025 adjusted EPS up 28% |
| Pinnacle net interest income | +12% | Above-peer balance sheet growth driven by recruiting |
| Synovus net interest income | +7% | Fixed-rate asset repricing and funding cost benefits from core deposit growth |
| Pinnacle period-end loans | +10% | Recruiting, particularly in expansion geographic markets |
| Synovus period-end loans | +5% | Broad-based C&I lending |
| Pinnacle adjusted non-interest revenue | +25% | Higher service charges, wealth management revenue, and income from BHG |
| Synovus adjusted non-interest revenue | +16% | Broad-based growth including capital markets fees up 30% |
Earnings Call Themes & Trends
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Merger integration and systems conversion | Deal announced, close pending | Closed January 1; both firms operating on legacy platforms until conversion in first quarter 2027, with key milestones and leadership decisions completed | — |
| Revenue producer hiring model | 217 hired across both firms in 2025 | Goal of 250 in 2026; legacy Synovus adopting the Pinnacle rapid-hiring model, expected to reach a similar pace by 2027 | — |
| Revenue synergies | $100 million-$130 million target over 2-3 years | Work started immediately (hold limits, hiring, capital markets cross-pollination); some benefit embedded in 2026 guidance, with confidence in exceeding the target | — |
| Capital deployment and buybacks | CET1 at record highs pre-close | $400 million buyback authorized; capital to be accreted early in 2026 with repurchases reassessed later in the year, targeting 10.25%-10.75% CET1 | — |
| BHG | $30 million Q4 fee revenue including a $5 million true-up | Strong production and outlook; $125-$135 million investment income guided for 2026 with continued focus on core business | — |
| Deposit pricing and betas | Quarter-on-quarter rate paid down about 30 basis points | Blended deposit beta ~48% in the easing cycle; 45%-50% beta expected for the rest of 2026 assuming two rate cuts | — |
Q&A Summary
What can the combined bank not do today that it will be able to do post-conversion, and how are new clients and hires onboarded in the interim?
Kevin Blair said both companies operate on existing legacy platforms without encumbering new business; complex clients onboard directly onto the in-state platform to avoid a second conversion, and new hires use whichever legacy market platform applies, with people and Net Promoter Scores the priority.
When would buybacks actually be initiated given the $400 million authorization?
Jamie Gregory said the firm would love to buy at current prices but expects to accrete capital through early 2026 given limited first quarter accretion from merger expenses; no repurchases this quarter, unlikely next quarter, then reassess later in the year.
What is your confidence in the 9%-11% pro forma loan growth given a competitive backdrop and CapEx uncertainty?
Kevin Blair pointed to the pro forma company already generating 10% loan growth in Q4, with growth coming from existing team members, recent hires, and specialty businesses rather than reliance on economic growth.
Why did cost savings recognition move from 50% to 40% for year one, and is there risk of further delay?
Jamie Gregory said the fast January 1 close outpaced systems work, pushing back some synergies, and the firm leaned into best-in-class benefits; year-two and total savings were unchanged, making it a timing difference.
How should we think about the combined 2026 NIM range of 3.45%-3.55%?
Kevin Blair explained Pinnacle's 3.27% Q4 margin combined with a marked Synovus book in the 3.75%-3.80% area yields the low-3.50s; Synovus yields are slightly lower than originally modeled because rates declined in the belly of the curve.
What are your updated thoughts on the long-term earnings power versus the illustrative $11.63 EPS shown at announcement?
Kevin Blair said both companies ended 2025 strong and 2026 guidance is above consensus; lower rates are a headwind to PAA and the Synovus mark, but better-than-expected loan growth offsets it, with Terry Turner emphasizing sustainability from already-hired producers and the advantaged footprint.
More on Pinnacle Financial Partners, Inc.
Reported 2026-01-22 · figures from the Pinnacle Financial Partners, Inc. Q4 2025 earnings call.
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