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Pinnacle Financial Partners in Nashville, Tenn., has settled into its newer markets in Virginia and the Carolinas.

The $26 billion-asset company entered those states in mid-2017 when it bought BNC Bancorp in High Point, N.C. Since then, Pinnacle has bulked up by aggressively hiring revenue producers, including 49 commercial lenders through March 31.

Management says it is pleased with the results so far. Total loans in Virginia and the Carolinas increased by nearly 10% in the first quarter from a year earlier. Core deposits in those markets rose by 9.3%.

Terry Turner, Pinnacle’s president and CEO, predicts that there will be more opportunities to hire bankers from competitors in light of the pending BB&T-SunTrust merger. The blockbuster deal is also giving Turner a reason to consider expansion into other markets such as Atlanta and Richmond, Va.

“BB&T-SunTrust causes me to want to study and work on those opportunities,” Turner said in a recent interview.

In the Carolinas, Pinnacle has had the most success in hiring people from Wells Fargo, which continues to deal with fallout from its fake-accounts scandal, and SunTrust, Turner said.

“Everything is about personal connectivity,” Turner said. “We don’t generally hire people who are circulating a resume or come to us. … We take people we recently hired and ask them for referrals. They help us recruit the next hires.”

Turner also discussed activity in Nashville, his approach to credit quality and how he plans to keep pursuing growth at a bank that is already well above $20 billion in assets.

Here is an edited transcript of that discussion.

How do you feel about Pinnacle’s markets?
TERRY TURNER: Nashville is a critical market. It is big, vibrant and arguably the best market in our footprint. What’s next? Charlotte is the next biggest and best and Raleigh would be third. … Greenville and Charleston [in South Carolina] also have high growth profiles.

As we think about our growth, we’ve got good opportunities in all our Tennessee markets … which will be stimulated by our big markets in North Carolina and Virginia.

How about your ability to compete against bigger banks?
We engineered Pinnacle to handle what’s difficult for bigger companies. They become more bureaucratic and more starched the bigger they get. It takes energy away from the clients and employees.

The truth is the big banks have virtually all the clients, but they also have the most vulnerability because of the impersonality. We’re students of market research. When you look at Greenwich data for banks in our newer markets, you find that the big banks’ client satisfaction ratings are horrible. We try to match up against them based on a belief that the people equation wins.

What’s your approach to recruiting?
We target folks who have been successful but marginalized at those banks. I think we have a pretty good recruiting methodology where everything is about personal connectivity. We don’t generally hire people who are circulating a resume or come to us. … What we do is take people we recently hired and ask them for referrals. They help us recruit the next hires.

Big companies generate reports and budgets, then hire for openings, which is too late. We’re recruiting people all the time, regardless of what the budget is.

What about the potential to hire from BB&T and SunTrust?
We’ve hired a good number of people from BB&T, but it is easier to hire people from Wells and SunTrust. BB&T has leveraged the old-fashioned defined benefit pension plan, where a lot of people are unhappy but they don’t want to leave because of the big retirement plan ahead of them.

I think there’s more vulnerability on the SunTrust side. … I’d say in last year or two in the Carolinas and Virginia, Wells has been the top target and SunTrust is second in terms of people we’ve been able to hire.

Does BB&T-SunTrust give you a reason to enter more markets?
When we talk about the markets we desire to go in, we start in Memphis and draw lines to Washington and Charleston. Roughly in that triangle is where we want to operate. We’re in 10 of the 15 markets we want to be in. We’re not in Atlanta; Columbia [S.C.]; Tidewater Virginia, Richmond or D.C.

BB&T-SunTrust causes me to want to study and work on those opportunities.

What types of positions are you filling?
We say that our number for revenue producers equals relationship managers for lending and deposits, mortgage originators, licensed brokers and insurance agents. … You tend to hire two support people for each producer. As long as you’re hiring [people who are] producing revenue, you can hire the supporters needed to keep customer service high.

What’s the story Pinnacle is sharing with investors?
If you look at our performance over time, we try to manage the fundamentals and show up every 90 days with increased earnings and revenue. … As we’ve gotten bigger, investors have become more skeptical. People get concerned about the law of large numbers, thinking you can’t continue to grow. They have underestimated our ability to keep hiring people and producing better numbers. … We’re not just sitting here asking our existing horse to run faster.

Are there any lending categories that have you concerned?
Over the last two or three years we’ve had different areas where we tapped the brakes. We monitor real estate concentrations by product type. We had concerns about retail, given the Amazon impact [on brick-and-mortar stores], so there have been points where we tapped the brakes or had concerns about some cities. There have been caution lights at times, but no red lights.


We had some concerns in a market like Nashville, particularly with hospitality and multifamily in the downtown core. … But we feel better now than we did a year or two ago because the city has absorbed so much of that stuff.

We continue to feel bullish on the markets we’re in and the strength of the economy. Every market I’ve mentioned would be extraordinarily successful, with job growth tied to corporate relocations. Those markets work when you have job growth.

Any interest in bank acquisitions?
We look at both hiring and M&A. We generally like our approach to hiring. If you go buy a bank you have pay a premium. You don’t have that if you hire their people. In a number of markets, we started on a de novo basis and began from scratch. Then again, having a stock with a premium makes deals more attractive, and we have a pretty good premium.

The list of targets is shrinking, right?
We’ve been pretty specific about where we want to go. And we’ve been clear about the kinds and sizes of banks we’re interested in. It’s not like there’s a list of 45 or so, but we know those folks and try to cultivate relationships with them. … We just want to be in a position to move when they’re ready to sell.

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