U. S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 29549


                                   FORM 10-QSB



                   QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                  FOR QUARTERLY PERIOD ENDED SEPTEMBER 30, 1999

                         COMMISSION FILE NUMBER 33-67528


                         PINNACLE FINANCIAL CORPORATION
        (Exact name of small business issuer as specified in its charter)

        GEORGIA                                         58-1538862
-------------------------------           --------------------------------------
(State or other jurisdiction of          (I.R.S. Employer Identification Number)
incorporation or organization)

884 Elbert Street,
P.o. Box 430, Elberton, Georgia                              30635-0430
----------------------------------------                     ----------
(Address of principal executive offices)                     (Zip Code)


Issuer's telephone number, including area code: (706) 283-2854

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. Yes /X/ No  / /

         State the number of shares  outstanding of each of the issuer's classes
         of common equity, as of the latest practicable date:

  As of October 31, 1999 there were 768,000 shares of common stock outstanding.
  -----------------------------------------------------------------------------

<PAGE>
                                          PINNACLE FINANCIAL CORPORATION


                                                       INDEX


                                                                       Page No.
PART I -       FINANCIAL INFORMATION

Item 1.        Financial Statements

               Consolidated Statements of Financial Position at
               September 30, 1999 and December 31, 1998                    1

               Consolidated Statements of Income for the Three
               Months ended September 30, 1999 and 1998                    2

               Consolidated Statements of Income for the Nine
               Months ended September 30, 1999 and 1998                    3

               Consolidated Statements of Cash Flows for the
               Nine Months Ended September 30, 1999 and 1998               4

Item 2.        Managements Discussion and Analysis or Plan of
               Operation                                                   6


PART II -      OTHER INFORMATION                                           14



                                        I


<PAGE>

                         PINNACLE FINANCIAL CORPORATION

                         PART I - FINANCIAL INFORMATION

                          ITEM 1. FINANCIAL STATEMENTS





                                       II


<PAGE>



                             PINNACLE FINANCIAL CORPORATION & SUBSIDIARY
                                     CONSOLIDATED BALANCE SHEETS
                               SEPTEMBER 30, 1999 AND DECEMBER 31, 1998
                                             (Unaudited)
<TABLE>
<CAPTION>
                                                                   September 30,       December 31,
                                                                       1999                1998

Assets
-------
<S>                                                               <C>                   <C>
       Cash and due from banks                                    $   9,392,878         $ 10,083,914
       Federal funds sold                                                     0            7,150,000

       Securities available for sale                                101,389,378           92,807,286

       Loans, net of allowance for credit losses
         of $2,172,112 and $2,070,005, respectively                 148,353,095          142,025,057

       Premises and equipment                                         8,266,365            8,636,788
       Accrued interest receivable                                    2,619,060            2,653,111
       Foreclosed real estate                                           527,990              495,566
       Other assets                                                   2,491,453            1,335,761
                                                                  -------------         ------------

         Total assets                                             $ 273,040,219         $265,187,483
                                                                  =============         ============


Liabilities
-----------
       Demand deposits                                            $  44,916,896         $ 41,417,077
       Savings and NOW deposits                                      71,537,071           67,996,928
       Other time deposits                                          108,657,151          111,527,553
                                                                  -------------         ------------

         Total deposits                                             225,111,118          220,941,558

       Federal funds purchased                                          210,000                    0
       Federal Home Loan Bank Advances                                3,000,000                    0
       Accrued interest and other liabilities                         3,506,083            3,598,216
                                                                  -------------         ------------

         Total liabilities                                          231,827,201          224,539,774
                                                                  -------------         ------------

Shareholders' Equity
--------------------
       Common stock, $10 par value; 5,000,000 shares
         authorized, 768,000 shares issued and outstanding            7,680,000            7,680,000
       Capital surplus                                                7,280,000            7,280,000
       Retained earnings                                             27,224,481           24,669,429
       Accumulated other comprehensive income                          (971,463)           1,018,280

         Total shareholders' equity                                  41,213,018           40,647,709
                                                                  -------------         ------------

        TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                $ 273,040,219         $265,187,483
                                                                  =============         ============


              THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
</TABLE>


                                                         1

<PAGE>
<TABLE>
<CAPTION>

                                    PINNACLE FINANCIAL CORPORATION & SUBSIDIARY
                                         CONSOLIDATED STATEMENTS OF INCOME
                              FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
                                                    (UNAUDITED)
                                                                                   THREE MONTHS    THREE MONTHS
                                                                                      ENDED             ENDED
                                                                                   SEPTEMBER 30,   SEPTEMBER 30,
                                                                                       1999            1998
<S>                                                                                  <C>            <C>
Interest Income
---------------
       Loans                                                                         $3,672,412     $3,751,084
       Securities available for sale                                                  1,490,846      1,413,999
       Federal funds sold                                                                36,135         68,452
                                                                                     ----------     ----------

         Total interest income                                                        5,199,393      5,233,535
                                                                                     ----------     ----------

Interest Expense
----------------
       Deposits                                                                       1,836,740      1,997,494
       Borrowings                                                                         3,618            390
                                                                                     ----------     ----------

         Total interest expense                                                       1,840,358      1,997,884
                                                                                     ----------     ----------

NET INTEREST INCOME                                                                   3,359,035      3,235,651

       Provision for credit losses                                                       75,000         75,000
                                                                                     ----------     ----------

         Net interest income after provision for credit losses                        3,284,035      3,160,651
                                                                                     ----------     ----------

Other Income
------------
       Service charges on deposit accounts                                              325,355        310,286
       Other service charges and fees                                                   190,593        220,700
       Net realized gains on sales of securities available for sale                       3,864          8,343
       Other income                                                                      61,282         44,733
                                                                                     ----------     ----------

         Total other income                                                             581,094        584,062
                                                                                     ----------     ----------

Other Expenses
--------------
       Salaries and employee benefits                                                 1,128,751      1,168,531
       Occupancy expense                                                                314,232        268,066
       Other expenses                                                                   473,461        553,260
                                                                                     ----------     ----------

         Total other expenses                                                         1,916,444      1,989,857
                                                                                     ----------     ----------

Income before income taxes                                                            1,948,685      1,754,856
Income tax expense                                                                      596,000        517,600
                                                                                     ----------     ----------

NET INCOME                                                                           $1,352,685     $1,237,256
                                                                                     ==========     ==========

Net income per share of common stock                                                 $     1.76     $     1.61
                                                                                     ==========     ==========

Average shares outstanding                                                              768,000        768,000
                                                                                     ==========     ==========

              The accompanying notes are an integral part of these financial statements.
</TABLE>

                                                  2

<PAGE>

<TABLE>
<CAPTION>

                                    PINNACLE FINANCIAL CORPORATION & SUBSIDIARY
                                         CONSOLIDATED STATEMENTS OF INCOME
                               FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
                                                    (UNAUDITED)

                                                                             YTD             YTD
                                                                         SEPTEMBER 30,   SEPTEMBER 30,
                                                                             1999           1998
<S>                                                                      <C>             <C>
INterest Income
---------------
       Loans                                                             $10,718,228     $11,179,188
       Securities available for sale                                       4,344,211       4,071,299
       Federal funds sold                                                    209,578         266,728
                                                                         -----------     -----------

         Total interest income                                            15,272,017      15,517,215
                                                                         -----------     -----------

Interest Expense
----------------
       Deposits                                                            5,571,109       5,957,606
       Borrowings                                                              3,618             657
                                                                         -----------     -----------

         Total interest expense                                            5,574,727       5,958,263
                                                                         -----------     -----------

Net Interest Income                                                        9,697,290       9,558,952
-------------------                                                        ---------       ---------
       Provision for credit losses                                           225,000         225,000
                                                                         -----------     -----------

         Net interest income after provision for credit losses             9,472,290       9,333,952
                                                                         -----------     -----------

Other Income
------------
       Service charges on deposit accounts                                   994,133         961,811
       Other service charges and fees                                        639,318         663,102
       Net realized gains on sales of securities available for sale                0          25,568
       Other income                                                          167,763         148,391
                                                                         -----------     -----------

         Total other income                                                1,801,214       1,798,872
                                                                         -----------     -----------

Other Expenses
--------------
       Salaries and employee benefits                                      3,438,570       3,407,724
       Occupancy expense                                                     882,078         786,348
       Net realized losses on sales of securities available for sale           2,105               0
       Other expenses                                                      1,394,499       1,466,445
                                                                         -----------     -----------

         Total other expenses                                              5,717,252       5,660,517
                                                                         -----------     -----------

Income before income taxes                                                 5,556,252       5,472,307
Income tax expense                                                         1,734,000       1,687,255
                                                                         -----------     -----------

NET INCOME                                                               $ 3,822,252     $ 3,785,052
                                                                         ===========     ===========

Net income per share of common stock                                     $      4.98     $      4.93
                                                                         ===========     ===========

Average shares outstanding                                                   768,000         768,000
                                                                         ===========     ===========

              The accompanying notes are an integral part of these financial statements.
</TABLE>

                                                  3

<PAGE>

                            PINNACLE FINANCIAL CORPORATION & SUBSIDIARY
                                CONSOLIDATED STATEMENTS OF CASH FLOWS
                        FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
                                             (UNAUDITED)
<TABLE>
<CAPTION>
                                                                              SEPTEMBER 30,     SEPTEMBER 30,
                                                                                 1999                1998
<S>                                                                          <C>                 <C>
CASH FLOW FROM OPERATING ACTIVITIES
Net income                                                                   $  3,822,252        $  3,785,053
                                                                             ------------        ------------
Adjustments to reconcile net income to net
       Cash provided by operating activities:
         Depreciation and amortization                                            469,819             369,442
         Provision for credit losses                                              225,000             225,000
         Net realized (gains) losses on securities available for sale               2,105             (25,568)
         Increase in accrued interest and other assets                         (1,154,065)           (259,361)
         Increase (decrease) in accrued expenses and other liabilities            (92,133)            495,517
                                                                             ------------        ------------
         Total adjustments                                                       (549,274)            805,030
                                                                             ------------        ------------

Net cash provided by operating activities                                       3,272,978           4,590,083
                                                                             ------------        ------------

CASH FLOWS FROM INVESTING ACTIVITIES
Net (increase) decrease in federal funds sold                                   7,150,000            (172,830)
Purchase of securities available for sale                                     (35,742,875)        (30,591,080)
Proceeds from sales of securities available for sale                            3,025,625           1,748,595
Proceeds from maturities of securities available for sale                      22,124,190          20,546,866
Net increase in loans                                                          (6,553,038)           (706,459)
Purchases of premises and equipment                                               (80,276)           (467,808)
                                                                             ------------        ------------

Net cash used by investing activities                                         (10,076,374)         (9,642,716)
                                                                             ------------        ------------

CASH FLOWS FROM FINANCING ACTIVITIES
Net increase in non-interest bearing demand deposits,
       Savings and NOW deposit accounts                                         7,039,962           2,893,510
Net decrease in time deposits                                                  (2,870,402)           (114,613)
Net increase (decrease) in borrowings                                           3,210,000            (360,000)
Dividends paid                                                                 (1,267,200)         (1,152,000)

Net cash provided by financing activities                                       6,112,360           1,266,897
                                                                             ------------        ------------

Net decrease in cash and due from banks                                          (691,036)         (3,785,736)
Cash and due from banks at January 1                                           10,083,914          10,789,675

Cash and due from banks at September 30                                      $  9,392,878        $  7,003,939
                                                                             ============        ============

Interest paid                                                                $  5,372,360        $  5,551,045
                                                                             ============        ============

Income taxes paid                                                            $  1,702,635        $  1,695,465
                                                                             ============        ============

              The accompanying notes are an integral part of these financial statements.
</TABLE>

                                                  4

<PAGE>



                  PINNACLE FINANCIAL CORPORATION AND SUBSIDIARY
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998

(1)      Basis of Presentation
         ---------------------
         The consolidated  financial statements include the accounts of Pinnacle
Financial  Corporation  (the  Company)  and  its  wholly-owned  commercial  bank
subsidiary,  Pinnacle Bank, N.A. All significant intercompany accounts have been
eliminated in consolidation.

         In the opinion of management,  the accompanying  unaudited consolidated
financial  statements  contain  all  adjustments   (consisting  only  of  normal
recurring  adjustments)  necessary  for  fair  statements  of  the  consolidated
financial  position and the results of operations of the Company for the interim
periods. The results of operations for the nine-month period ended September 30,
1999 are not necessarily indicative of the results which may be expected for the
entire year.

(2)      Income Taxes
         ------------
         Deferred  income  taxes  are  recorded  as  required  by FAS  No.  109,
"Accounting for Income Taxes",  using the liability  method under which deferred
tax assets and liabilities are determined  based on the differences  between the
financial accounting and tax basis of assets and liabilities.

(3)      Accounting for Impaired Loans
         -----------------------------
         FAS 114, "Accounting by Creditors for Impairment of a Loan" was adopted
as of January 1, 1995 as required.  Loans having  carrying values of $666,000 as
of September 30, 1999 have been  recognized  as impaired in conformity  with FAS
114. The total  allowance  for credit  losses  related to the impaired  loans is
$509,000.  For  impairment  recognized  in  conformity  with FAS 114, the entire
change in the  present  value of  expected  cash flows is  reported  as bad debt
expense in the same manner in which the initial  impairment was recognized or as
a reduction in the amount of bad debt expense that otherwise  would be reported.
The company has  recognized  specific  allowances  in prior  periods for each of
these loans based on previous  methodology  for  calculating  its  allowance for
credit losses.



                                        5

<PAGE>

ITEM 2.           MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN
                  OF OPERATION

                  Management's  Discussion  and Analysis or Plan of Operation of
Pinnacle  Financial  Corporation   (hereinafter  "Pinnacle"  or  the  "Company")
analyses  the major  elements  of  Pinnacle's  consolidated  balance  sheets and
statements of income. The financial  condition and operating results of Pinnacle
are primarily  determined by its wholly-owned  subsidiary  bank,  Pinnacle Bank,
N.A.(hereinafter the "Bank").

                  Pinnacle continues to weigh the merits of additional  business
combinations  while  maintaining a focus on its general  mission to  responsibly
serve the needs of its customers and communities and to enhance profit potential
and shareholder value.

                  For  a  comprehensive  presentation  of  Pinnacle's  financial
condition and results of  operations,  the following  analysis  should be viewed
along with other information  contained in this report,  including the financial
statements and accompanying disclosures. All amounts throughout this section are
rounded to the nearest 1,000 dollars,  the nearest .1 million dollars and to the
nearest .1 percent to represent approximations of reported amounts.


Forward-Looking Statements
--------------------------

                  This discussion contains forward-looking  statements under the
private  Securities  Litigation  Reform  Act  of  1995  that  involve  risk  and
uncertainties.  Although Pinnacle  believes that the assumptions  underlying the
forward-looking  statements  contained in the discussion are reasonable,  any of
the  assumptions  could be inaccurate,  and therefore,  no assurance can be made
that any of the forward-looking  statements in this discussion will be accurate.
Factors  that could cause  actual  results to differ from  results  discussed in
forward-looking  statements include, but are not limited to: economic conditions
(both generally and in the markets where the Company operates); competition from
other  providers  of  financial   services  offered  by  the  Bank;   government
regulations  and  legislation;  changes in interest rates;  material  unforeseen
changes in the financial stability and liquidity of the Bank's credit customers;
material  unforeseen  complications  related  to the Year  2000  issues  for the
Company, its suppliers,  customers,  and governmental agencies, all of which are
difficult  to  predict  and which  may be beyond  the  control  of the  Company.
Pinnacle  undertakes  no  obligation  to revise  forward-looking  statements  to
reflect  events or changes  after the date of this  discussion or to reflect the
occurrence of unanticipated events.


Liquidity and Capital Resources
-------------------------------

                  The  objective of  liquidity  management  is to maintain  cash
flows  adequate to meet  immediate  and ongoing  future needs of credit  demand,
deposit  withdrawal,  maturing  liabilities  and corporate  operating  expenses.
Pinnacle seeks to meet liquidity  requirements  primarily through the management
of federal funds and the investment securities portfolio. At September 30, 1999,
8.8% of the investment securities portfolio had maturity dates within the

                                        6

<PAGE>
next  year  and an  additional  67.2%  matures  within  the  next 5  years.  All
investment  securities  are  classified as available for sale and may be sold or
used as a source  of  collateralized  borrowings  in the  event  of a  liquidity
shortfall. Other sources of liquidity are payments on commercial and installment
loans and repayment of maturing  single payment  loans.  The Bank has short term
borrowing  relationships  with two correspondent  banks that could provide up to
$10.75  million  on  short  notice.  Additionally,   the  Bank  has  established
membership in the Federal Home Loan Bank of Atlanta (hereinafter the "FHLB") and
has granted a blanket floating lien on its mortgage  portfolio that collaterizes
up to $20  million  of  borrowings  on a short or long  term  basis.  Pinnacle's
management  intends to continue  to closely  monitor  and  maintain  appropriate
levels of  interest-bearing  assets and  liabilities  in future  periods so that
maturities of assets are such that adequate  funds are provided to meet customer
withdrawals and loan requests while net interest margins are maximized.

                  Regulatory  policy  generally  requires the  maintenance  of a
liquidity  ratio  of  25%,  which  is  generally  defined  as cash  plus  liquid
investments divided by deposits plus borrowings due within one year. The desired
level of liquidity  is  determined  by  management  based in part on  Pinnacle's
commitment to make loans and an assessment of its ability to generate  funds. At
September 30, 1999, the liquidity ratio for Pinnacle was 39.4%.

                  Management  continues to give  priority to the  importance  of
maintaining high levels of assets with interest rate sensitivity.  Cash and cash
equivalents  decreased  during the first nine months of 1999 from  December  31,
1998 levels by $7.8 million while  securities  available  for sale  increased by
$8.6 million from December 31, 1998 to September 30, 1999.  The average  balance
in these  investment  securities  increased  by $9.3 million in the current year
compared to the nine months ended  September  30, 1998.  The average  balance of
Federal Funds sold during the first nine months of 1999 was $5.6 million.  It is
anticipated  that average  Federal  Funds sold will  decrease as a percentage of
assets in the future. See discussion below regarding management's use of sources
of funds.

                  Total  interest-earning  assets  increased  by $7.8 million or
3.2% as of September 30, 1999 when compared with December 31, 1998.  Average net
loans  increased  $400,000  (0.3%) to $142.9  million in the nine  months  ended
September 30, 1999 from the same 1998 period. This slight increase is the result
of significant loan demand in the third quarter of 1999 that offset a decline in
average loans for the first half of the year.

                  The allowance for credit losses is  established  by management
at a level  estimated  to be  adequate  to absorb  losses  inherent  in the loan
portfolio.  The  allowance  increased  to $2.2  million  from  $2.1  million  at
September 30, 1999 and December 31, 1998. The Bank  experienced loan charge-offs
of $262,000 in the nine months ended  September 30, 1999 compared to $179,000 in
the same period of 1998. Net  charge-offs  amounted to $123,000 in 1999 compared
to $58,000 for the nine months ended  September  30,  1998.  The  allowance  for
credit losses  represents 1.4% of total loans  outstanding at September 30, 1999
and December 31, 1998.

                  The balance of other real estate owned has increased by 32,000
from  $496,000 at December  31, 1998 to $528,000 at  September  31,  1999.  This
change is the net result of the sale of five  properties and the  foreclosure on
two new properties during this period. The accrual of

                                        7

<PAGE>
interest has been  discontinued  on loans  totaling  $9,000 as of September  30,
1999,  representing  .01% of loans,  compared to $139,000 at December  31, 1998.
Unrecorded  income on nonaccrual  loans for the nine months ended  September 30,
1999 was $4,000.  All non-accrual  loans at September 30, 1999 are classified as
unsecured.

                  Pinnacle   continues  to  maintain  a  concentration  of  core
deposits  from an  established  customer  base which  provides a stable  funding
source.  Deposits increased $4.2 million to $225.1 million at September 30, 1999
from $220.9  million at December  31,  1998,  due  primarily  to normal  growth.
Non-interest  bearing  deposits  increased  $3.5  million to $44.9  million from
December 31, 1998 while interest-bearing  deposits increased $.7 million for the
same period.

                  As  indicated  above,  Bank  management  actively  manages its
liquidity  position  and  has  obtained  several  sources  of both  secured  and
unsecured borrowed funds. These sources have allowed the bank to invest a higher
percentage of its funds in loans and  investment  securities  that earn a higher
yield than overnight  investments.  As a consequence,  the third quarter of 1999
includes  increased  use of federal  funds  purchased  and,  for the first time,
borrowings  from the FHLB. The $3 million of FHLB advances were used to purchase
investment  securities to improve the net interest income of Pinnacle.  The Bank
anticipates continued use of these sources of funds in an attempt to enhance its
earnings  while  continuing to monitor the  maturities and interest rate risk of
interest-bearing assets and liabilities.

                  Shareholders'  equity  increased $0.6 million to $41.2 million
at September  30, 1999 from $40.6  million at December  31,  1998.  Net earnings
retained during the nine months amounted to $2.6 million while equity  decreased
$2.0  million due to of a decline  from a $1.0  million net  unrealized  gain on
investments  available  for  sale to an  unrealized  loss of $1.0  million  (All
unrealized  amounts  are  reported  net of their tax  impact.  The shift from an
unrealized  gain to loss  resulted  in the  recording  of a deferred  tax asset,
causing much of the increase in other assets from December 31, 1998). The change
in unrealized  amounts reflects the increase in interest rates from December 31,
1998 and widening of spreads on non treasury instruments.

                  Pinnacle  continues to maintain  adequate  capital ratios (see
"Risk Based  Capital  Ratios"  below and see "Results of  Operations"  below for
discussion  of dividend  levels.)  Pinnacle  maintained  a level of capital,  as
measured by its average  equity to average  assets  ratio,  of 15.2%  during the
first nine months of 1999,  compared to 15.0% for the year which ended  December
31, 1998.

                  The bank is a defendant  in a lawsuit  that  alleges  unlawful
conversion of assets and seeks damages of $270,000 plus interest. The outcome of
the  litigation is uncertain but management  believes,  based upon the advice of
legal  counsel,  that any  ultimate  loss will be  immaterial  to the  financial
statements. Legal expenses of the lawsuit are being expensed as incurred.

                  Management is not aware of any trends, events or uncertainties
that are reasonably  likely to have a material  effect on Pinnacle's  liquidity,
capital resources, or results of operation. Pinnacle is not aware of any current
recommendations by the regulatory authorities

                                        8

<PAGE>
which,  if  implemented,  would  have  such  an  effect.  Loans  classified  for
regulatory  purposes as loss,  doubtful,  substandard or special  mention do not
represent  trends or  uncertainties  which  management  reasonably  expects will
materially impact future operational trends.


RESULTS OF OPERATIONS (for the three month period ended September 30, 1999)

                  Pinnacle's  operating results primarily depend on the earnings
of the Bank. Its earnings depend to a large degree on net interest  income,  the
difference between the interest income received from investments (such as loans,
investment securities, federal funds sold, etc.)
and the interest expense paid on deposits and borrowings.

                  Interest  income  on  interest  bearing  assets  decreased  by
$35,000 as a decline in average  yields  from 8.4% to 8.3% offset an increase in
average  earning  assets in the third  quarter of 1999 as compared to 1998.  The
slight decline in yield reflects a general decline in interest rates during much
of the period and  increasing  competition  for loans  resulting  in the need to
price more  competitively.  Interest  expense declined by $158,000 from the same
quarter  of 1998 in  spite  of  increased  deposits  as a  result  of  increased
non-interest  bearing  deposits  and lower  interest  rates paid on all  deposit
accounts.  Consequently, net interest income in the three months ended September
30,  1999  increased  by $123,000 or 3.8% as compared to the same period for the
previous year.  Management  continues to match rate  sensitive  assets with rate
sensitive  liabilities  in such a way that net interest  margins  have  remained
stable from the same period in the prior year.

                  The  provision  for credit  losses is the charge to  operating
expenses that management  believes is necessary to fund the allowance for credit
loan losses.  The provision  reflects  management's  estimate of potential  loan
losses and the  creation  of an  allowance  for loan  losses  adequate to absorb
losses inherent in the portfolio.  Pinnacle  provided $75,000 for loan losses in
both quarters ended September 30, 1999 and 1998.

                  Other income during the three months ended  September 30, 1999
was unchanged as compared to the same period in 1998.  Other operating  expenses
during the three  months  ended  September  30, 1999  decreased  $74,000 to $1.9
million from $2.0 million for the same period in the previous year. The decrease
is  attributable to decreased  compensation  and benefits as fewer mortgage loan
originations   resulted   in  lower   amounts  of   volume-based   compensation.
Additionally,  legal fees  declined by $75,000 from the third quarter of 1998 as
an unusually  high level of fees were paid during that  quarter.  These  expense
reductions were somewhat offset by increased occupancy expenses related to a new
branch facility opened in late 1998.

                  Pinnacle's  income  tax  expense  increased  $78,000  for  the
quarter  compared  to the same  period in the  previous  year due  primarily  to
increased  taxable  income.  The  effective  income tax rate of 30.6% during the
quarter  is an  increase  of .9% over the rate of 29.5% in the same  quarter  of
1998.

                  Results  of  operations  can be  measured   by  various  ratio
analyses.  Two widely  recognized  performance  indicators are return on average
equity and return on average assets. Net

                                        9

<PAGE>

income  during the three  months ended  September  30, 1999 was $1.4 million and
represents  annualized returns of 13.2% on average shareholders' equity and 2.0%
on average assets.  Comparable  amounts during the same period of 1998 were $1.2
million, 13.0% and 1.9%, respectively.

                  Dividends declared during the three months ended September 30,
1999 increased $.05 per share to $.55 from $.50 per share during the same period
of 1998.


RESULTS OF OPERATIONS  (for the nine month period ended September 30, 1999)

                  Interest income on interest bearing assets for the nine months
ended  September 30, 1999  decreased by $245,000 from the same period in 1998. A
decline in average  yields from 8.7% to 8.3% was somewhat  offset by an increase
in average  earning  assets in 1999 as  compared  to 1998.  The decline in yield
reflects a general  decline in  interest  rates  during the period as well as an
increased percentage of funds invested in lower yielding investment  securities.
Interest  expense  declined by $383,000 from the same period of 1998 in spite of
increased  deposits as a result of increased  non-interest  bearing deposits and
lower interest rates paid on all deposit  accounts.  Consequently,  net interest
income in the nine months ended September 30, 1999 increased by $138,000 or 1.4%
as compared to the same period for the previous year.

                  The  provision  for credit losses and its purpose is explained
above.  Pinnacle  provided  $225,000  for credit  losses in both  periods  ended
September 30, 1999 and 1998.

                  Other income  during the nine months ended  September 30, 1999
was  virtually  unchanged at $1.8  million from the same period in 1998.  Slight
increases  in  service  charges  and  other  miscellaneous   income  offset  the
nonrecurrence of 1998 gains on sales of securities.

                  Other   operating   expenses  during  the  nine  months  ended
September 30, 1999  increased  $56,000 (to $5.7 million) from the same period in
the previous  year.  The increase in other  operating  expenses is  attributable
generally to normal increases in compensation  and employee  benefits as well as
increased expenses related to a branch opened in late 1998. The decline in legal
expenses mentioned above served to somewhat reduce the amount of the increase.

                  Pinnacle's  income tax expense  increased $47,000 for the nine
months ended September 30, 1999 compared to the same period in the previous year
due primarily to increased taxable income.  The effective income tax rate during
the period of 31.2% is a minor increase of 0.4% from the effective rate of 30.8%
in 1998.

                  Net income during the nine months ended September 30, 1999 was
$3.8 million and represents annualized returns of 12.5% on average shareholders'
equity and 1.90% on average assets. Comparable amounts during the same period of
1998 were $3.8 million,  13.2% and 2.0%,  respectively.  As indicated above, net
income  increased  primarily due to increased net interest  income  offsetting a
slight  increase in operating  expenses  while the operating  ratios reflect the
increased earnings compared to a slightly larger asset and equity base.

                                       10

<PAGE>
                  Dividends  declared during the nine months ended September 30,
1999  increased  $.15 per share to $1.65  from  $1.50 per share  during the same
period of 1998.


Year 2000
---------

                  Generally,  year  2000 risk  involves  computer  programs  and
computer  hardware that are not able to perform  without  interruption  into the
year 2000.  The arrival of the year 2000 poses a unique  worldwide  challenge to
the ability of all systems to correctly  recognize the date change from December
31, 1999 to January 1, 2000.  If Pinnacle's  systems do not correctly  recognize
such a date change, computer applications that rely on the date field could fail
or create erroneous results.  Such errors could affect interest,  payment or due
dates or could  cause the  temporary  inability  to process  transactions,  send
invoices  or  engage  in  similar  normal  business  activities.  If it  is  not
adequately  addressed by Pinnacle or its suppliers and borrowers,  the year 2000
issue  could  result  in a  material  adverse  impact  on  Pinnacle's  financial
condition, liquidity and results of operations.

                  PINNACLE'S  STATE OF  READINESS.  Pinnacle is  proceeding on a
plan that will  assure the Bank is ready to  process in the year 2000.  The plan
involves five phases consisting of awareness, assessment, renovation, validation
and  implementation  for hardware and  software in both  information  technology
systems ("IT") and non-information technology systems ("non- IT"or environmental
systems) that are potentially  affected by the year 2000. Pinnacle has completed
all phases and all critical business systems have been renovated.  Substantially
all noncritical systems have been renovated with renovation of the few remaining
non-critical systems continuing throughout 1999.  Modifications and upgrades are
performed on the majority of  Pinnacle's  IT systems by  third-party  vendors as
Pinnacle performs no internal programming.

                  COST TO  ADDRESS  THE YEAR  2000  ISSUES.  In 1997  and  1998,
Pinnacle  made  substantial  investments  in  technology in the normal course of
business to enhance operational  efficiency that included remediation of many of
its year 2000 issues. The cost of assuring readiness to process in the year 2000
has been  budgeted to not exceed  $40,000 for the years 1998 through  2000,  not
including  the  investments  in  technology  referred  to  above  nor  the  time
associated with existing employee  development and  implementation of Pinnacle's
year 2000 plan.  Approximately  25% of this amount was expensed in 1998 with the
remainder of the expenses to be incurred in 1999.  At this time,  this budget is
expected to be adequate.  The  majority of costs  associated  with  hardware and
software enhancements to make Pinnacle's systems year 2000 compliant are covered
in the annual  maintenance fees paid to its vendors and are not included in this
budgeted amount.  Any unexpected costs that may arise during  implementation  in
excess of the budgeted amounts will be reported to the Board of Directors.

                  RISKS OF THIRD-PARTY YEAR 2000 ISSUES. The impact of year 2000
non-compliance by outside parties with whom Pinnacle  transacts  business cannot
be  accurately  estimated.  In addition to the review of IT providers  discussed
above,  Pinnacle has surveyed major  borrowers for year 2000  compliance and has
prepared a  detailed  assessment  of the risk  associated  with each  borrower's
inability to be compliant. In addition, all primary non-IT vendors and suppliers
have   responded  to  inquiries   regarding   year  2000   compliance.   Ongoing
communication with these

                                       11

<PAGE>
primary vendors and suppliers is anticipated  throughout  1999. At this time, no
material  impact  on  Pinnacle's   operations  from  vendor   non-compliance  is
anticipated but no provider can assure Pinnacle that no disruptions  will occur.
Pinnacle would be significantly  impacted by failures in power and communication
systems  that are largely  outside of the control of the Bank.  Pinnacle  relies
upon the  Federal  Reserve  System  for  electronic  funds  transfers  and check
clearing and  understands  that its systems are year 2000  compliant.  Extensive
testing of the Federal  Reserve  systems have been completed and all indications
are that the systems should perform as designed. If the Federal Reserve does not
successfully  complete  all  modifications  required  by the date  change and is
forced to interrupt services to Pinnacle,  Pinnacle could experience significant
difficulties.

                  Pinnacle  continues  to  host  educational  seminars,  provide
meaningful  information to customers and community  groups  regarding  risks and
solutions to plan for Year 2000  uncertainties and provide assistance on prudent
activities to be taken. The Bank's primary Year 2000 activities  during the last
quarter  of 1999  will  involve  community  awareness  campaigns  and  providing
assurances that all steps have been taken to prepare for the new year.

                  PINNACLE'S  CONTINGENCY  PLANS.  Pinnacle  has  not  developed
system  remediation  contingency plans as all mission critical systems have been
tested and  certified as year 2000  compliant.  Pinnacle has prepared a business
resumption plan that provides detailed directions for continued operation if one
or more mission critical items (including power and communication systems) fails
due to year 2000 related  issues.  The plan  documents how Pinnacle will recover
from any  critical  system  failures  within  an  acceptable  time  frame  while
delivering an acceptable  level of service.  The plan assumes  either use of the
Bank's hot site  facility or limited  transaction  processing  on a manual basis
(depending upon the fact situation and the systems  involved) until the impacted
systems can be corrected or replaced.  The plan has been  reviewed and certified
by an  independent  third  party and has been  approved by  Pinnacle's  Board of
Director's.  Testing of the  significant  procedures  occurred  during the third
quarter of 1999 with  additional  testing and  employee  training  planned as we
approach the year 2000.

                  Pinnacle's  contingency  plans also include the  monitoring of
cash  withdrawals and cash balances to determine the need to increase  liquidity
at branch locations.  Pinnacle has the ability to pledge  additional  investment
securities with the Federal Reserve Bank of Atlanta and  correspondent  banks to
provide additional cash in the event of significantly increased customer demand.
These facilities provide borrowing capacity in addition to the amounts indicated
earlier in this  document.  Nevertheless,  an extreme  level of customer fear or
uncertainty  could result in significant  unanticipated  withdrawals  that could
have a material impact on the Bank's short term operations.



                                       12

<PAGE>

The  following  tables  present  Pinnacle's   Regulatory  capital  position  at
September 30, 1999:

                        (Rounded to the nearest thousand)


Total Risk Adjusted Assets                             $168,664

Risk Based Capital Ratios:

TIER 1 CAPITAL
     Common stock                                      $  7,680           4.55%
     Surplus                                              7,280           4.32%
     Retained Earnings                                   27,224          16.14%
        Less: Goodwill                                        0           0.00%
                                                       --------          -----
     Total Tier 1 capital                                42,184          25.01%
     Tier 1 minimum requirement                           6,747           4.00%
                                                       --------          -----
     Excess (shortfall)                                $ 35,437          21.01%
                                                       ========          =====

TIER 2 CAPITAL
     Tier 1 from above                                 $ 42,184          25.01%
     Subordinated Debentures                                  0           0.00%
     Allowance for loan losses, limited to 1.25%
        of risk weighted assets                           2,108           1.25%
                                                       --------          -----
     Total Tier 2 capital                                44,292          26.26%
     Tier 2 minimum requirement                          13,493           8.00%
                                                       --------          -----
     Excess (shortfall)                                $ 30,799          18.26%
                                                       ========          =====

LEVERAGE RATIO
     Tier 1 capital                                    $ 42,184          15.64%
     Minimum requirement                                 10,787           4.00%
                                                       --------          -----
     Excess (shortfall)                                $ 31,397          11.64%
                                                       ========          =====

Average total assets, net of goodwill                  $269,663
                                                       ========


                                       13

<PAGE>

                         PINNACLE FINANCIAL CORPORATION

                                     PART II

ITEM 1.     LEGAL PROCEEDINGS

                   Pinnacle  Bank,  N.A. is a defendant in a lawsuit  brought by
Capitol  Resource  Funding in U.S.  District  Court for the Middle  District  of
Georgia,  filed in March 1997, File No.  3:97-C-116  (HL) that alleges  unlawful
conversion of assets and seeks damages of $270,000 plus interest. The outcome of
the  litigation  is uncertain at this time.  Management  believes,  based on the
advice of legal counsel, that any ultimate loss will be immaterial to the
financial statements. Legal costs are being expenses as incurred.

ITEM 2.     CHANGES IN SECURITIES

                  None.

ITEM 3.     DEFAULTS UPON SENIOR SECURITIES

                  None.

ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

                  None.

ITEM 5.     OTHER INFORMATION

                  None.

ITEM 27.     EXHIBITS AND REPORTS ON FORM 8-K

                  Exhibit 27 - Financial Data Schedule (for SEC use only).




                                       14

<PAGE>

                                   SIGNATURES



                   In accordance with the  requirements of the Exchange Act, the
registrant has caused this report to be signed on its behalf by the  undersigned
thereunto duly authorized.


                                PINNACLE FINANCIAL CORPORATION


Date: November 12, 1999          By: /S/ L. Jackson Mcconnell
      -----------------              -------------------------
                                         L. Jackson Mcconnell
                                 Chairman and Chief Executive Officer
                                 (Principal Executive and Financial Officer)

Date: November 12, 1999          By: /S/ James E. Purcell
      -----------------              ------------------------
                                        James E. Purcell
                                 President and Chief Credit Officer


                                       15