Magazine article American Banker

2Q RESULTS: First Horizon Back in the Black

Magazine article American Banker

2Q RESULTS: First Horizon Back in the Black

Article excerpt

Byline: Jeff Horwitz

It wasn't pretty, but First Horizon National Corp. returned to profitability after eight consecutive quarters of losses.

Behind its $2.7 million, penny-a-share profit were a few one-time accounting gains. But the Memphis company's headway in battling its credit troubles allowed it to lower its provisioning for loan losses and reduce noninterest expense.

"We're certainly not declaring victory," Chief Financial Officer William Losch 3rd said Friday on a conference call with analysts. "But with that said, we're pleased with the second quarter's progress."

Nonperforming assets dropped from 5.6% in the first quarter to 4.9% in the second, with the biggest reductions coming as the bank wound down its construction loan portfolio. Chargeoffs fellby more $50 million, to $133 million, and provisioning fell by a third, to $70 million. Delinquencies in mortgages improved, which the company attributed to the smaller portfolio's seasoning. The only portfolio whose reserves did not decline was commercial real estate, which remained flat.

Previously after releasing quarterly results, First Horizon regularly promised investors that it could bring credit costs down at a sustainable pace. Given the uneven nature of the economic recovery, analysts saw the second-quarter results as evidence that management had a handle on its broader portfolio."We expect a better-than-peers rate of credit quality improvements in the rest of 2010, as legacy lending winds down," Standard & Poor's analyst Erica Oja wrote in a research note Friday. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed


An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.