The five Pinan kata were said to have been created by Anko Itosu (Funakoshi's instructor) in 1905 in order to simplify instruction to the children he had been teaching in the public schools of Okinawa since 1905. He developed these from the original Chinese kata such as Kushanku and Channan.
Funakoshi renamed these kata "Heian" when he took karate to mainland Japan. Heian is shortened from two words "Heiwa" meaning Peace and "Antei" meaning Stability. The name can translate as Peaceful Mind, Peaceful Safety, and also Peaceful and Calm. Pinan is the Chinese "Pinyin" notation and it also means Peaceful and Calm.
One of the stories surrounding the history of the Pinan kata claims that Itosu learned a kata from a Chinese man living in Okinawa. This kata was called "Chiang Nan". The form became known as "Channan", an Okinawan/Japanese approximation of the Chinese pronunciation. The original form of the Channan kata is lost. Itosu formed five katas from the long Channan Kata which he thought would be easier to learn. The five kata were Pinans Shodan, Nidan, Sandan, Yondan, and Godan. We call these Pinans Ichi, Ni, San, Yon, and Go in Kyokushin.
Pinan Ni was the first kata that was taught in this series but it is reported that Funakoshi changed the order and made the current Pinan Ichi the first kata. In his book Karate do Kyohan states that once the five Heian kata have been mastered one can be confident that he/she is able to defend themselves competently in most situations.