Chairman for the Carolinas & Virginia and Director, Pinnacle Finl Partners
Search every verified Richard Callicutt interview, podcast appearance, and on-the-record quote — each transcript cross-checked by AI and human review to confirm speaker identity. In a September 2024 CNBC appearance, Pinnacle Financial Partners CEO Terry Turner discussed the company's incentive compensation structure, stating that 100% of salary-based associates are included in the incentive plan and that payouts are tied to hitting revenue and EPS targets. Turner noted that in 2023, a difficult year for banks, the company reduced incentives by 38%, and that assuming targets are met in the following year, the incentive expense would need to increase from 62% to 100%. He said the company believes it will grow EPS. Regarding commercial real estate exposure, Turner said the bank is "well underneath" regulatory guidelines of 100% of risk-based capital for construction credit and 300% for total commercial real estate. He attributed the health of the portfolio to strong growth in the Southeast since 2020, describing the region as the only U.S. quadrant with positive net population growth. Turner stated that the bank's internal scenario is for a soft landing rather than a serious recession.
“We run an incentive plan here that's different than every bank I know. Specifically, 100% of the salary-based associates are included in that incentive plan, so when we give guidance, we include that incentive payout. The way that gets paid is based on us hitting revenue targets and EPS targets.”
“It's our belief we will grow EPS. One of the dynamics is that in 2023, a difficult year for banks, we reduced our incentives by 38%, which ends up being harvested into the earnings stream of the company. Assuming we hit our targets next year, you have to get that lift from 62% up to 100%.”
“We have really, I think for regional banks, we're pretty well in line. Regulators use a guideline of 100% of risk-based capital for construction credit, 300% of risk-based capital for total commercial real estate. We're well underneath all of those guidelines.”
“The markets that we operate here in the Southeast are significantly different than what I see in San Francisco or New England or some of these other markets. We've enjoyed really strong growth since 2020, which is a very different dynamic and plays out in the health of the commercial real estate portfolio.”
Terry Turner, Pinnacle Financial Partners CEO, joins 'Money Movers' to discuss Turner's expectations for the company's expenses ...
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