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Loans and Allowance for Loan Losses (Tables)
 12 Months Ended
Dec. 31, 2018
Receivables [Abstract]  
Loans and Allowance for Loan Losses - Purchase Credit Impaired
Purchase credit impaired loans purchased during the three years ended December 31, 2018 for which it was probable at acquisition that all contractually required payments would not be collected are as follows (in thousands):
 
December 31,
 
2018
2017
2016
Contractually required payments receivable
$
—

$
94,312

$
1,359

Cash flows expected to be collected at acquisition
—

48,498

547

Fair value of acquired loans at acquisition
—

48,302

547
Summary of Amount of Each Loan Classification, Categorized into Each Risk Rating Class
The following table outlines the amount of each loan classification categorized into each risk rating category as of December 31, 2018 and 2017 (in thousands):
December 31, 2018
Commercial real estate - mortgage
 
Consumer real estate - mortgage
 
Construction and land development
 
Commercial and industrial
 
Consumer
and other
 
Total
Pass
$
6,998,485

 
$
2,787,570

 
$
2,059,376

 
$
5,148,726

 
$
352,516

 
$
17,346,673

Special Mention
55,932

 
7,902

 
4,334

 
24,284

 
711

 
93,163

Substandard
78,202

 
20,906

 
5,358

 
75,351

 
62

 
179,879

Substandard-nonaccrual
32,335

 
28,069

 
3,387

 
23,060

 
983

 
87,834

Doubtful-nonaccrual
—

 
—

 
—

 
—

 
—

 
—

Total loans
$
7,164,954

 
$
2,844,447

 
$
2,072,455

 
$
5,271,421

 
$
354,272

 
$
17,707,549

December 31, 2017
Commercial real estate - mortgage
 
Consumer real estate - mortgage
 
Construction and land development
 
Commercial and industrial
 
Consumer
and other
 
Total
Pass
$
6,487,368

 
$
2,503,688

 
$
1,880,704

 
$
4,014,656

 
$
351,359

 
$
15,237,775

Special Mention
94,134

 
18,356

 
8,148

 
46,898

 
1,177

 
168,713

Substandard
72,044

 
21,053

 
13,468

 
62,529

 
79

 
169,173

Substandard-nonaccrual
16,064

 
18,117

 
5,968

 
17,258

 
48

 
57,455

Doubtful-nonaccrual
—

 
—

 
—

 
—

 
—

 
—

Total loans
$
6,669,610

 
$
2,561,214

 
$
1,908,288

 
$
4,141,341

 
$
352,663

 
$
15,633,116
Purchase Credit Impaired Loans
The following table provides a rollforward of purchase credit impaired loans from December 31, 2016 through December 31, 2018 (in thousands):
 
Gross Carrying Value
 
Accretable Yield
 
Nonaccretable Yield
 
Carrying Value
 
 
 
 
 
 
 
 
December 31, 2016
$
12,468

 
$
—

 
$
(3,633
)
 
$
8,835

Acquisitions
80,812

 
(196
)
 
(32,314
)
 
48,302

Settlements, net
(18,956
)
 
64

 
4,410

 
(14,482
)
December 31, 2017
74,324

 
(132
)
 
(31,537
)
 
42,655

Acquisitions
—

 
—

 
—

 
—

Settlements, net
(31,487
)
 
18

 
14,143

 
(17,326
)
December 31, 2018
$
42,837

 
$
(114
)
 
$
(17,394
)
 
$
25,329
Summary of Recorded Investment, Unpaid Principal Balance and Related Allowance and Average Recorded Investment of Impaired Loans

Purchase credit impaired loans purchased during the three years ended December 31, 2018 for which it was probable at acquisition that all contractually required payments would not be collected are as follows (in thousands):
 
December 31,
 
2018
2017
2016
Contractually required payments receivable
$
—

$
94,312

$
1,359

Cash flows expected to be collected at acquisition
—

48,498

547

Fair value of acquired loans at acquisition
—

48,302

547



Impaired loans, as disclosed in the table below, include troubled debt restructurings, nonaccrual loans, and loans deemed to be impaired but that continue to accrue interest. The following tables detail the recorded investment, unpaid principal balance and related allowance of Pinnacle Financial's impaired loans at December 31, 2018, 2017 and 2016 by loan classification (in thousands):

 
December 31, 2018
 
For the year ended
December 31, 2018
 
Recorded investment
 
Unpaid principal balance
 
Related allowance
 
Average recorded investment
 
Cash basis
interest income recognized
Impaired loans with an allowance:
 
 
 
 
 
 
 
 
 
Commercial real estate – mortgage
$
14,114

 
$
14,124

 
$
724

 
$
10,260

 
$
—

Consumer real estate – mortgage
19,864

 
19,991

 
1,443

 
13,154

 
—

Construction and land development
581

 
579

 
28

 
1,157

 
—

Commercial and industrial
9,252

 
9,215

 
1,441

 
9,326

 
—

Consumer and other
983

 
1,005

 
328

 
718

 
—

Total
$
44,794

 
$
44,914

 
$
3,964

 
$
34,615

 
$
—

 
 
 
 
 
 
 
 
 
 
Impaired loans without an allowance:
 

 
 

 
 

 
 

 
 

Commercial real estate – mortgage
$
14,724

 
$
14,739

 
$
—

 
$
17,906

 
$
469

Consumer real estate – mortgage
7,247

 
7,271

 
—

 
5,477

 
—

Construction and land development
1,786

 
1,786

 
—

 
1,463

 
—

Commercial and industrial
14,595

 
14,627

 
—

 
15,796

 
—

Consumer and other
—

 
—

 
—

 
—

 
—

Total
$
38,352

 
$
38,423

 
$
—

 
$
40,642

 
$
469

 
 
 
 
 
 
 
 
 
 
Total impaired loans
$
83,146

 
$
83,337

 
$
3,964

 
$
75,257

 
$
469

 
December 31, 2017
 
For the year ended
December 31, 2017
 
Recorded investment
 
Unpaid principal balance
 
Related allowance
 
Average recorded investment
 
Cash basis
interest income recognized
Impaired loans with an allowance:
 
 
 
 
 
 
 
 
 
Commercial real estate – mortgage
$
1,850

 
$
1,863

 
$
95

 
$
650

 
$
—

Consumer real estate – mortgage
8,028

 
8,079

 
410

 
4,990

 
—

Construction and land development
2,522

 
2,528

 
66

 
567

 
—

Commercial and industrial
12,521

 
12,644

 
1,627

 
10,559

 
—

Consumer and other
—

 
—

 
—

 
425

 
—

Total
$
24,921

 
$
25,114

 
$
2,198

 
$
17,191

 
$
—

 
 
 
 
 
 
 
 
 
 
Impaired loans without an allowance:
 

 
 

 
 

 
 

 
 

Commercial real estate – mortgage
$
16,364

 
$
16,514

 
$
—

 
$
6,983

 
$
—

Consumer real estate – mortgage
4,144

 
4,174

 
—

 
5,727

 
—

Construction and land development
2,645

 
2,650

 
—

 
1,890

 
95

Commercial and industrial
10,905

 
10,902

 
—

 
9,039

 
—

Consumer and other
—

 
—

 
—

 
—

 
—

Total
$
34,058

 
$
34,240

 
$
—

 
$
23,639

 
$
95

 
 
 
 
 
 
 
 
 
 
Total impaired loans
$
58,979

 
$
59,354

 
$
2,198

 
$
40,830

 
$
95

 
December 31, 2016
 
For the year ended
December 31, 2016
 
Recorded investment
 
Unpaid principal balance
 
Related allowance
 
Average recorded investment
 
Cash basis
interest income recognized
Impaired loans with an allowance:
 
 
 
 
 
 
 
 
 
Commercial real estate – mortgage
$
442

 
$
452

 
$
60

 
$
537

 
$
—

Consumer real estate – mortgage
3,300

 
3,303

 
690

 
6,503

 
—

Construction and land development
84

 
129

 
20

 
77

 
—

Commercial and industrial
4,054

 
4,051

 
95

 
5,868

 
—

Consumer and other
516

 
819

 
227

 
2,488

 
—

Total
$
8,396

 
$
8,754

 
$
1,092

 
$
15,473

 
$
—

 
 
 
 
 
 
 
 
 
 
Impaired loans without an allowance
 

 
 

 
 

 
 

 
 

Commercial real estate – mortgage
$
2,308

 
$
2,312

 
$
—

 
$
2,346

 
$
—

Consumer real estate – mortgage
5,641

 
5,674

 
—

 
2,065

 
—

Construction and land development
3,128

 
3,135

 
—

 
3,403

 
159

Commercial and industrial
14,277

 
14,367

 
—

 
9,187

 
—

Consumer and other
—

 
—

 
—

 
—

 
—

Total
$
25,354

 
$
25,488

 
$
—

 
$
17,001

 
$
159

 
 
 
 
 
 
 
 
 
 
Total impaired loans
$
33,750

 
$
34,242

 
$
1,092

 
$
32,474

 
$
159
Amount of Troubled Debt Restructuring Categorized by Loan Classification
The following table outlines the amount of each troubled debt restructuring by loan classification made during the years ended December 31, 2018, 2017 and 2016 (dollars in thousands):
 
Number
of contracts
 
Pre Modification Outstanding Recorded Investment
 
Post Modification Outstanding Recorded Investment, net of related allowance
December 31, 2018
 
 
 
 
 
Commercial real estate – mortgage
—

 
$
—

 
$
—

Consumer real estate – mortgage
3

 
1,967

 
1,967

Construction and land development
1

 
347

 
347

Commercial and industrial
—

 
—

 
—

Consumer and other
—

 
—

 
—

 
4

 
$
2,314

 
$
2,314

December 31, 2017
 
 
Commercial real estate – mortgage
—

 
$
—

 
$
—

Consumer real estate – mortgage
1

 
6

 
5

Construction and land development
—

 
—

 
—

Commercial and industrial
2

 
3,776

 
3,751

Consumer and other
—

 
—

 
—

 
3

 
$
3,782

 
$
3,756

 
 
 
 
 
 
December 31, 2016
 
 
Commercial real estate – mortgage
—

 
$
—

 
$
—

Consumer real estate – mortgage
—

 
—

 
—

Construction and land development
—

 
—

 
—

Commercial and industrial
6

 
11,084

 
11,083

Consumer and other
—

 
—

 
—

 
6

 
$
11,084

 
$
11,083


During the years ended December 31, 2018, 2017 and 2016, Pinnacle Financial had no troubled debt restructurings that subsequently defaulted within twelve months of the restructuring. A default is defined as an occurrence which violates the terms of the receivable's contract.
Summary of Loan Portfolio Credit Risk Exposure
In addition to the loan metrics above, Pinnacle Financial analyzes its commercial loan portfolio to determine if a concentration of credit risk exists to any industries.  Pinnacle Financial utilizes broadly accepted industry classification systems in order to classify borrowers into various industry classifications.  Pinnacle Financial has a credit exposure (loans outstanding plus unfunded lines of credit) exceeding 25% of Pinnacle Bank's total risk-based capital to borrowers in the following industries at December 31, 2018 with the comparative exposures for December 31, 2017 (in thousands):
 
At December 31, 2018
 
 
 
Outstanding Principal Balances
 
Unfunded Commitments
 
Total exposure
 
Total Exposure at
December 31, 2017
Lessors of nonresidential buildings
$
3,149,948

 
$
782,111

 
$
3,932,059

 
$
3,483,597

Lessors of residential buildings
1,200,653

 
284,044

 
1,484,697

 
1,151,676

New housing for-sale builders
511,484

 
589,505

 
1,100,989

 
780,137

Hotels and motels
779,390

 
140,611

 
920,001

 
836,320
Past Due Balances by Loan Classification
The table below presents past due balances at December 31, 2018 and 2017, by loan classification and segment allocated between performing and nonperforming status (in thousands):
 
Accruing
 
Nonaccruing
 
 
December 31, 2018
30-89 days past due and accruing
90 days or more past due and accruing
Total past due and accruing
Current and accruing
Purchase credit impaired
 
Nonaccrual (1)
Nonaccruing purchase credit impaired
 
Total loans
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
Owner-occupied
$
10,170

$
—

$
10,170

$
2,623,700

$
2,664

 
$
16,025

$
874

 
$
2,653,433

All other
1,586

—

1,586

4,488,840

5,659

 
12,634

2,802

 
4,511,521

Consumer real estate – mortgage
18,059

—

18,059

2,794,630

3,689

 
22,564

5,505

 
2,844,447

Construction and land development
3,759

—

3,759

2,063,201

2,108

 
2,020

1,367

 
2,072,455

Commercial and industrial
21,451

1,082

22,533

5,225,205

623

 
23,022

38

 
5,271,421

Consumer and other
3,276

476

3,752

349,537

—

 
983

—

 
354,272

Total
$
58,301

$
1,558

$
59,859

$
17,545,113

$
14,743

 
$
77,248

$
10,586

 
$
17,707,549

 
Accruing
 
Nonaccruing
 
 
December 31, 2017
30-89 days past due and accruing
90 days or more past due and accruing
Total past due and accruing
Current and accruing
Purchase credit impaired
 
Nonaccrual (1)
Nonaccruing purchase credit impaired
 
Total loans
Commercial real estate:
 
 
 
 
 
 
 
 
 
 
Owner-occupied
$
6,772

$
104

$
6,876

$
2,435,819

$
4,820

 
$
11,395

$
1,105

 
$
2,460,015

All other
16,559

—

16,559

4,177,454

12,018

 
704

2,860

 
4,209,595

Consumer real estate – mortgage
14,835

1,265

16,100

2,521,748

5,249

 
9,320

8,797

 
2,561,214

Construction and land development
4,136

146

4,282

1,894,560

3,478

 
2,878

3,090

 
1,908,288

Commercial and industrial
7,406

1,348

8,754

4,114,127

1,154

 
17,222

84

 
4,141,341

Consumer and other
6,311

1,276

7,587

345,076

—

 
—

—

 
352,663

Total
$
56,019

$
4,139

$
60,158

$
15,488,784

$
26,719

 
$
41,519

$
15,936

 
$
15,633,116


(1)
Approximately $52.5 million and $45.8 million of nonaccrual loans as of December 31, 2018 and December 31, 2017, respectively, were performing pursuant to their contractual terms at those dates.
Details of Changes in the Allowance for Loan Losses

The following table details the changes in the allowance for loan losses from December 31, 2016 to December 31, 2017 to December 31, 2018 by loan classification and the allocation of allowance for loan losses (in thousands):
 
Commercial real estate - mortgage
Consumer real estate - mortgage
Construction and land development
Commercial and industrial
Consumer and other
Unallocated
Total
Allowance for Loan Losses:
 
 
 
 
 
 
 
Balance at December 31, 2015
$
15,513

$
7,220

$
2,903

$
23,643

$
15,616

$
537

$
65,432

Charged-off loans
(276
)
(788
)
(231
)
(5,801
)
(24,016
)
—

(31,112
)
Recovery of previously charged-off loans
208

546

545

2,138

2,895

—

6,332

Provision for loan losses
(1,790
)
(414
)
407

4,763

15,025

337

18,328

Balance at December 31, 2016
$
13,655

$
6,564

$
3,624

$
24,743

$
9,520

$
874

$
58,980

 
 
 
 
 
 
 
 
Collectively evaluated for impairment
$
13,595

$
5,874

$
3,604

$
24,648

$
9,293

 

$
57,014

Individually evaluated for impairment
60

690

20

95

227

 

1,092

Loans acquired with deteriorated credit quality
—

—

—

—

—

 

—

Balance at December 31, 2016
$
13,655

$
6,564

$
3,624

$
24,743

$
9,520

$
874

$
58,980

 
 
 
 
 
 
 
 
Loans:
 

 

 

 

 

 

 

Collectively evaluated for impairment
$
3,188,361

$
1,174,456

$
906,053

$
2,872,855

$
265,613

 

$
8,407,338

Individually evaluated for impairment
2,750

8,941

3,212

18,331

516

 

33,750

Loans acquired with deteriorated credit quality
2,385

2,520

3,408

524

—

 

8,837

Balance at December 31, 2016
$
3,193,496

$
1,185,917

$
912,673

$
2,891,710

$
266,129

 

$
8,449,925

 
Commercial real estate - mortgage
Consumer real estate - mortgage
Construction and land development
Commercial and industrial
Consumer and other
Unallocated
Total
Allowance for Loan Losses:
 
 
 
 
 
 
 
Balance at December 31, 2016
$
13,655

$
6,564

$
3,624

$
24,743

$
9,520

$
874

$
58,980

Charged-off loans
(633
)
(1,461
)
(137
)
(4,297
)
(15,518
)
—

(22,046
)
Recovery of previously charged-off loans
671

1,516

1,136

1,317

2,002

—

6,642

Provision for loan losses
7,495

(1,588
)
4,339

3,100

9,870

448

23,664

Balance at December 31, 2017
$
21,188

$
5,031

$
8,962

$
24,863

$
5,874

$
1,322

$
67,240

 
 
 
 
 
 
 
 
Collectively evaluated for impairment
$
20,753

$
4,460

$
8,879

$
23,181

$
5,874

 

$
63,147

Individually evaluated for impairment
95

410

66

1,627

—

 

2,198

Loans acquired with deteriorated credit quality
340

161

17

55

—

 

573

Balance at December 31, 2017
$
21,188

$
5,031

$
8,962

$
24,863

$
5,874

$
1,322

$
67,240

 
 
 
 
 
 
 
 
Loans:
 

 

 

 

 

 

 

Collectively evaluated for impairment
$
6,630,593

$
2,534,996

$
1,896,553

$
4,116,677

$
352,663

 

$
15,531,482

Individually evaluated for impairment
18,214

12,172

5,167

23,426

—

 

58,979

Loans acquired with deteriorated credit quality
20,803

14,046

6,568

1,238

—

 

42,655

Balance at December 31, 2017
$
6,669,610

$
2,561,214

$
1,908,288

$
4,141,341

$
352,663

 
$
15,633,116

 
Commercial real estate - mortgage
Consumer real estate - mortgage
Construction and land development
Commercial and industrial
Consumer and other
Unallocated
Total
Allowance for Loan Losses:
 
 
 
 
 
 
 
Balance at December 31, 2017
$
21,188

$
5,031

$
8,962

$
24,863

$
5,874

$
1,322

$
67,240

Charged-off loans
(3,030
)
(1,593
)
(74
)
(13,175
)
(12,528
)


(30,400
)
Recovery of previously charged-off loans
2,096

2,653

1,863

3,035

2,711



12,358

Provision for loan losses
6,692

1,579

377

17,008

9,366

(645
)
34,377

Balance at December 31, 2018
$
26,946

$
7,670

$
11,128

$
31,731

$
5,423

$
677

$
83,575

 
 
 
 
 
 
 
 
Collectively evaluated for impairment
$
26,222

$
6,227

$
11,100

$
30,290

$
5,095

 

$
78,934

Individually evaluated for impairment
724

1,443

28

1,441

328

 

3,964

Loans acquired with deteriorated credit quality
—

—

—

—

—

 

—

Balance at December 31, 2018
$
26,946

$
7,670

$
11,128

$
31,731

$
5,423

$
677

$
83,575

 
 
 
 
 
 
 
 
Loans:
 

 

 

 

 

 

 

Collectively evaluated for impairment
$
7,124,117

$
2,808,142

$
2,066,613

$
5,246,913

$
353,289

 

$
17,599,074

Individually evaluated for impairment
28,838

27,111

2,367

23,847

983

 

83,146

Loans acquired with deteriorated credit quality
11,999

9,194

3,475

661

—

 

25,329

Balance at December 31, 2018
$
7,164,954

$
2,844,447

$
2,072,455

$
5,271,421

$
354,272

 
$
17,707,549