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Regulatory Matters
 12 Months Ended
Dec. 31, 2018
Regulatory Capital Requirements [Abstract]  
Regulatory Matters
Note 20.  Regulatory Matters

Pursuant to Tennessee banking law, Pinnacle Bank may not, without the prior consent of the Commissioner of the TDFI, pay any dividends to Pinnacle Financial in a calendar year in excess of the total of Pinnacle Bank's retained net income for that year plus the retained net income for the preceding two years. Under Tennessee corporate law, Pinnacle Financial is not permitted to pay dividends if, after giving effect to such payment, it would not be able to pay its debts as they become due in the usual course of business or its total assets would be less than the sum of its total liabilities plus any amounts needed to satisfy any preferential rights if it were dissolving. In addition, in deciding whether or not to declare a dividend of any particular size, Pinnacle Financial's board of directors must consider its and Pinnacle Bank's current and prospective capital, liquidity, and other needs. In addition to state law limitations on Pinnacle Financial's ability to pay dividends, the Federal Reserve imposes limitations on Pinnacle Financial's ability to pay dividends. Federal Reserve regulations limit dividends, stock repurchases and discretionary bonuses to executive officers if Pinnacle Financial's regulatory capital is below the level of regulatory minimums plus the applicable capital conservation buffer. During the year ended December 31, 2018, Pinnacle Bank paid $83.1 million in dividends to Pinnacle Financial. As of December 31, 2018, Pinnacle Bank could pay approximately $510.2 million of additional dividends to Pinnacle Financial without prior approval of the Commissioner of the TDFI. Pinnacle Financial initiated payment of a quarterly dividend of $0.08 per share of common stock in the fourth quarter of 2013 and has since increased the dividend to $0.12 beginning in the first quarter of 2015, to $0.14 beginning in the first quarter of 2016, and to $0.16 beginning in the fourth quarter of 2018. During the first quarter of 2019, Pinnacle Financial’s board of directors declared a dividend of $0.16 per share. The amount and timing of all future dividend payments, if any, is subject to the discretion of Pinnacle Financial's board of directors and will depend on Pinnacle Financial's earnings, capital position, financial condition and other factors, including new regulatory capital requirements, as they become known to us.

Pinnacle Financial and Pinnacle Bank are subject to various regulatory capital requirements administered by federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary actions, by regulators that, if undertaken, could have a direct material effect on the financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, Pinnacle Financial and Pinnacle Bank must meet specific capital guidelines that involve quantitative measures of the assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. Pinnacle Financial's and Pinnacle Bank's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors.

Quantitative measures established by regulation to ensure capital adequacy require Pinnacle Financial and its banking subsidiary to maintain minimum amounts and ratios of common equity Tier 1 capital to risk-weighted assets, Tier 1 capital to risk-weighted assets, total capital to risk-weighted assets and of Tier 1 capital to average assets.
 
The final rules implementing the Basel Committee on Banking Supervision's capital guidelines for U.S. banks (Basel III rules) became effective for Pinnacle Financial on January 1, 2015 with full compliance with all of the requirements being phased in over a multi-year schedule, and fully phased in by January 1, 2019. The minimum capital level requirements applicable to bank holding companies and banks subject to the rules are: (i) a common equity Tier 1 capital ratio of 4.5%; (ii) a Tier 1 capital ratio of 6%; (iii) a total capital ratio of 8%; and (iv) a Tier 1 leverage ratio of 4% for all institutions. The Basel III rules, also establish a capital conservation buffer of 2.5% (to be phased in over three years) above the regulatory minimum risk-based capital ratios. The phase-in of the capital conservation buffer requirement commenced in January 2016 at 0.625% of risk-weighted assets and increases each year by a like percentage until fully implemented in January 2019. The net unrealized gain or loss on available-for-sale securities is not included in computing regulatory capital. Management believes, as of December 31, 2018, that Pinnacle Financial and Pinnacle Bank met all capital adequacy requirements to which they are subject. To be categorized as well-capitalized under applicable banking regulations, Pinnacle Financial and Pinnacle Bank must maintain certain total, Tier 1, common equity Tier 1 and Tier 1 leverage capital ratios as set forth in the following table and not be subject to a written agreement, order or directive to maintain a higher capital level. The capital conservation buffer is not included in the required ratios of the table presented below. Pinnacle Financial's and Pinnacle Bank's actual capital amounts and ratios are presented in the following table (in thousands):
 
Actual
 
Minimum Capital
Requirement
 
Minimum
To Be Well-Capitalized
 
Amount
 
Ratio
 
Amount
 
Ratio
 
Amount
 
Ratio
December 31, 2018
 
 
 
 
 
 
 
 
 
 
 
Total capital to risk weighted assets:
 
 
 
 
 
 
 
 
 
 
 
Pinnacle Financial
$
2,580,143

 
12.2
%
 
$
1,691,017

 
8.0
%
 
N/A

 
N/A

Pinnacle Bank
$
2,432,419

 
11.5
%
 
$
1,686,046

 
8.0
%
 
$
2,107,558

 
10.0
%
Tier 1 capital to risk weighted assets:
 

 
 

 
 

 
 

 
 

 
 

Pinnacle Financial
$
2,024,193

 
9.6
%
 
$
1,268,263

 
6.0
%
 
N/A

 
N/A

Pinnacle Bank
$
2,218,003

 
10.5
%
 
$
1,264,535

 
6.0
%
 
$
1,686,046

 
8.0
%
Common equity Tier 1 capital:
 

 
 

 
 

 
 

 
 

 
 

Pinnacle Financial
$
2,024,070

 
9.6
%
 
$
951,197

 
4.5
%
 
N/A

 
N/A

Pinnacle Bank
$
2,217,880

 
10.5
%
 
$
948,401

 
4.5
%
 
$
1,369,912

 
6.5
%
Tier 1 capital to average assets (*):
 

 
 

 
 

 
 

 
 

 
 

Pinnacle Financial
$
2,024,193

 
8.9
%
 
$
909,102

 
4.0
%
 
N/A

 
N/A

Pinnacle Bank
$
2,218,003

 
9.8
%
 
$
906,185

 
4.0
%
 
$
1,132,731

 
5.0
%
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2017
 

 
 

 
 

 
 

 
 

 
 

Total capital to risk weighted assets:
 

 
 

 
 

 
 

 
 

 
 

Pinnacle Financial
$
2,266,161

 
12.0
%
 
$
1,509,496

 
8.0
%
 
N/A

 
N/A

Pinnacle Bank
$
2,134,344

 
11.3
%
 
$
1,504,765

 
8.0
%
 
$
1,880,956

 
10.0
%
Tier 1 capital to risk weighted assets:
 

 
 

 
 

 
 

 
 

 
 

Pinnacle Financial
$
1,725,323

 
9.1
%
 
$
1,132,122

 
6.0
%
 
N/A

 
N/A

Pinnacle Bank
$
1,936,313

 
10.3
%
 
$
1,128,574

 
6.0
%
 
$
1,504,765

 
8.0
%
Common equity Tier 1 capital:
 

 
 

 
 

 
 

 
 

 
 

Pinnacle Financial
$
1,725,219

 
9.1
%
 
$
849,092

 
4.5
%
 
N/A

 
N/A

Pinnacle Bank
$
1,936,209

 
10.3
%
 
$
846,430

 
4.5
%
 
$
1,222,621

 
6.5
%
Tier 1 capital to average assets (*):
 

 
 

 
 

 
 

 
 

 
 

Pinnacle Financial
$
1,725,323

 
8.6
%
 
$
797,861

 
4.0
%
 
N/A

 
N/A

Pinnacle Bank
$
1,936,313

 
9.7
%
 
$
796,235

 
4.0
%
 
$
995,294

 
5.0
%

(*) Average assets for the above calculations were based on the most recent quarter.

Pinnacle Financial's total assets exceeded $15.0 billion as a result of its acquisitions, which caused the subordinated debentures Pinnacle Financial and its acquired banks' previously issued in connection with the trust preferred securities of their affiliates to cease to qualify as Tier 1 capital under applicable banking regulations. Though these securities no longer qualify as Tier 1 capital, Pinnacle Financial believes these subordinated debentures continue to qualify as Tier 2 capital.