UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
Form
8-K
______________________
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event Reported): January 19,
2016
First Horizon National Corporation
(Exact Name of Registrant as Specified in Charter)
TENNESSEE |
001-15185 |
62-0803242 |
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
165 MADISON AVENUE, MEMPHIS, TENNESSEE 38103 |
(Address of Principal Executive Offices) (Zip Code) |
(901) 523-4444
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: |
|
[ ] |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
[ ] |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
[ ] |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
[ ] |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operations and Financial Condition.
Item 7.01. Regulation FD Disclosure.
Furnished as Exhibit 99.1 is a copy of First Horizon National Corporation’s earnings
release for the quarter and year ended December 31, 2015, which is scheduled to be released January 19, 2016.
The foregoing information is furnished pursuant to Item 2.02, "Results of Operations
and Financial Condition," and Item 7.01, "Regulation FD Disclosure." The exhibit speaks as of the date thereof and
First Horizon National Corporation ("First Horizon") does not assume any obligation to update in the future the information
therein.
Item 9.01. Financial Statements and Exhibits.
The following exhibit is furnished pursuant to Items 2.02 and 7.01, is not to be considered
“filed” under the Securities Exchange Act of 1934, as amended (“Exchange Act”), and shall not be incorporated
by reference into any of First Horizon's previous or future filings under the Securities Act of 1933, as amended, or the Exchange
Act.
Exhibit # |
|
Description |
99.1 |
|
First Horizon National Corporation Earnings Release issued for the quarter and year ended December 31, 2015. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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First Horizon National Corporation |
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Date: January 19, 2016 |
By: |
/s/ William C. Losch III |
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Name: William C. Losch III |
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Title: Executive Vice President and Chief Financial Officer |
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EXHIBIT INDEX
The following exhibit is furnished pursuant to Items 2.02 and 7.01, is not to be considered
“filed” under the Exchange Act, and shall not be incorporated by reference into any of First Horizon's previous or
future filings under the Securities Act of 1933, as amended, or the Exchange Act.
Exhibit # |
|
Description |
99.1 |
|
First Horizon National Corporation Earnings Release issued for the quarter and year ended December 31, 2015. |
EXHIBIT
99.1
First Horizon Wraps Up Successful 2015
MEMPHIS,
Tenn., Jan. 19, 2016 (GLOBE NEWSWIRE) -- First Horizon National Corp. (NYSE:FHN), parent company of First Tennessee Bank and FTN
Financial, achieved solid progress in 2015, growing key businesses and investing to further build the value of the company.
In fourth quarter 2015 First Horizon earned $0.20 per diluted share. 2015’s full-year net income of $80 million, or
$0.34 per share, included several notable items, and adjusted non-GAAP results were net income of $191 million, or $0.81 per share.
Average loans, average core deposits and fixed income average daily revenue all increased both quarter over quarter and year over
year. 2015 also saw First Horizon complete its acquisition of Raleigh, N.C.-based TrustAtlantic Bank and its parent company,
TrustAtlantic Financial Corp., in October.
“2015
was a very good year for our company,” said Bryan Jordan, First Horizon’s chairman and CEO. “First Tennessee
bankers profitably grew revenue, loans and deposits as they served the needs of our customers. We grew market share and
maintained excellent credit quality. FTN Financial saw a nice rebound in average daily revenue in the final quarter of the
year and finished as the No. 1 underwriter of GSE callable debt. I am very proud of the work our employees continue doing
to earn tremendous loyalty from our customers. We are well-positioned to continue our progress as we enter a new year.”
Financial
highlights
- From 2014 to 2015, total average loans grew 7 percent,
total average core deposits increased by 15 percent, and fixed income average daily revenues were up 15 percent. For 2015,
net income available to common shareholders was $79.7 million, or $0.34, compared to $216.3 million, or $0.91 per share, for 2014.
2015’s results included $162.5 million – a $0.42 per-share impact – related to the Department of Justice/HUD
settlement in April, another major step First Horizon took to resolve issues related to the mortgage business the company sold
in 2008. 2015’s full-year earnings included several notable items, as detailed in the reconciliation later in this
release; results with those items adjusted out were net income of $191 million, or $0.81 per share.
- Net income available to common shareholders in the
fourth quarter was $47 million, or $0.20 per share, compared to $58.8 million, or $0.25 per share, for third quarter. Fourth
quarter’s results included a $14 million litigation expense. Third quarter’s results included an $11.6 million
litigation expense, an $8 million pre-tax gain from employee benefits amendments and a $6 million pre-tax gain from retirement
of debt.
- First Tennessee, the regional bank, had yet another
strong quarter. Net interest income increased 3 percent from third to fourth quarter, bringing total 2015 growth to 9 percent.
Average loans rose 3 percent, and average core deposits were up 2 percent from third quarter to fourth quarter 2015. Once
again, commercial loans grew, driven by specialty lending areas. TrustAtlantic contributed to growth in commercial real
estate and business banking.
- FTN Financial, the fixed income group, capitalized
on lower rate uncertainty to increase average daily revenue 27 percent, to $850,000, in fourth quarter 2015 from $671,000 in the
prior quarter, contributing to a 15 percent increase in average daily revenue for the year. FTN Financial earned the No.
1 spot among underwriters of callable GSE (government-sponsored enterprise) debt for 2015, with total underwritings nearly doubling,
to $21 billion.
- Asset quality trends remained strong, with non-performing
loans and non-performing assets both declining from third quarter to fourth quarter and from full-year 2014 to full-year 2015.
- Capital levels also remained strong, with the estimated
Common Equity Tier 1 ratio at 10.45 percent. Share repurchases resumed in the fourth quarter. First Horizon has repurchased
33 million shares since October 2011, reducing net share count by 9 percent.
Consolidated
Summary Results
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4Q15
Changes vs. |
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|
Twelve
months ended |
|
2015
vs. |
(Dollars in thousands, except per
share data) |
4Q15 |
|
3Q15 |
|
4Q14 |
|
3Q15 |
|
4Q14 |
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2015 |
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2014 |
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2014 |
Income Statement Highlights |
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Net interest income |
$ |
166,652 |
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$ |
163,562 |
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$ |
159,050 |
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2 |
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% |
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|
5 |
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% |
|
|
$ |
653,720 |
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|
$ |
627,718 |
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4 |
|
% |
Noninterest income |
|
130,793 |
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|
125,448 |
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|
119,598 |
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4 |
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% |
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|
9 |
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% |
|
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|
515,947 |
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|
547,172 |
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(6 |
) |
% |
Securities gains/(losses), net |
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1,439 |
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(345 |
) |
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- |
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NM |
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NM |
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|
1,378 |
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|
2,872 |
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(52 |
) |
% |
Total
revenue |
|
298,884 |
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|
288,665 |
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|
278,648 |
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|
4 |
|
% |
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7 |
|
% |
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|
1,171,045 |
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|
1,177,762 |
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(1 |
) |
% |
Noninterest expense |
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243,740 |
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|
215,436 |
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|
207,309 |
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13 |
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% |
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18 |
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% |
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|
1,053,791 |
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|
832,531 |
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27 |
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% |
Provision for loan losses |
|
1,000 |
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|
1,000 |
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|
6,000 |
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* |
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(83 |
) |
% |
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|
9,000 |
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|
27,000 |
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(67 |
) |
% |
Income/(loss)
before income taxes |
|
54,144 |
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|
72,229 |
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|
65,339 |
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(25 |
) |
% |
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(17 |
) |
% |
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|
108,254 |
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|
318,231 |
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(66 |
) |
% |
Provision/(benefit) for income taxes |
|
2,715 |
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|
8,897 |
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|
13,699 |
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(69 |
) |
% |
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(80 |
) |
% |
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|
10,941 |
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|
84,185 |
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(87 |
) |
% |
Net
income/(loss) |
|
51,429 |
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|
63,332 |
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|
51,640 |
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(19 |
) |
% |
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* |
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|
97,313 |
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|
234,046 |
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(58 |
) |
% |
Net income attributable to noncontrolling interest |
|
2,848 |
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|
2,977 |
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|
2,980 |
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(4 |
) |
% |
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(4 |
) |
% |
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|
11,434 |
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|
11,527 |
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(1 |
) |
% |
Net income/(loss) attributable to controlling interest |
|
48,581 |
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|
60,355 |
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|
48,660 |
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(20 |
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% |
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* |
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|
85,879 |
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|
222,519 |
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(61 |
) |
% |
Preferred stock dividends |
|
1,550 |
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|
1,550 |
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1,550 |
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* |
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* |
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6,200 |
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6,200 |
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* |
|
Net
income/(loss) available to common shareholders |
$ |
47,031 |
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$ |
58,805 |
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$ |
47,110 |
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(20 |
) |
% |
|
* |
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|
$ |
79,679 |
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|
$ |
216,319 |
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(63 |
) |
% |
Common Stock Data |
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EPS |
$ |
0.20 |
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|
$ |
0.25 |
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|
$ |
0.20 |
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(20 |
) |
% |
|
* |
|
|
|
$ |
0.34 |
|
|
$ |
0.92 |
|
|
|
|
(63 |
) |
% |
Basic shares (thousands) |
|
237,983 |
|
|
|
233,111 |
|
|
|
233,693 |
|
|
|
2 |
|
% |
|
|
2 |
|
% |
|
|
|
234,189 |
|
|
|
234,997 |
|
|
|
* |
|
Diluted EPS |
$ |
0.20 |
|
|
$ |
0.25 |
|
|
$ |
0.20 |
|
|
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(20 |
) |
% |
|
* |
|
|
|
$ |
0.34 |
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|
$ |
0.91 |
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|
(63 |
) |
% |
Diluted shares (thousands) |
|
240,072 |
|
|
|
235,058 |
|
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|
235,448 |
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|
2 |
|
% |
|
|
2 |
|
% |
|
|
|
236,266 |
|
|
|
236,735 |
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|
* |
|
Period-end shares outstanding (thousands) |
|
238,587 |
|
|
|
234,237 |
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|
|
234,220 |
|
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|
2 |
|
% |
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|
2 |
|
% |
|
|
|
238,587 |
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|
234,220 |
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|
2 |
|
% |
Balance
Sheet Highlights (Period-End) |
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Total loans, net of unearned income |
$ |
17,686,502 |
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$ |
16,725,492 |
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$ |
16,230,166 |
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6 |
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% |
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9 |
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% |
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Total deposits |
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19,967,478 |
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|
18,865,220 |
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|
18,068,939 |
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6 |
|
% |
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|
11 |
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% |
|
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Total assets |
|
26,195,136 |
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|
25,387,319 |
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|
25,668,187 |
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|
3 |
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% |
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|
2 |
|
% |
|
|
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Total liabilities |
|
23,555,550 |
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|
|
22,807,074 |
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|
23,086,597 |
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|
3 |
|
% |
|
|
2 |
|
% |
|
|
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|
|
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Total equity |
|
2,639,586 |
|
|
|
2,580,245 |
|
|
|
2,581,590 |
|
|
|
2 |
|
% |
|
|
2 |
|
% |
|
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|
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|
|
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Asset Quality Highlights |
|
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Allowance for loan losses |
$ |
210,242 |
|
|
$ |
210,814 |
|
|
$ |
232,448 |
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* |
|
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(10 |
) |
% |
|
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|
Allowance / period-end loans |
|
1.19 |
|
% |
|
1.26 |
|
% |
|
1.43 |
|
% |
|
|
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|
Net charge-offs |
$ |
1,572 |
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|
$ |
11,537 |
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|
$ |
12,193 |
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(86 |
) |
% |
|
|
(87 |
) |
% |
|
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|
Net charge-offs (annualized) / average loans |
|
0.04 |
|
% |
|
0.28 |
|
% |
|
0.30 |
|
% |
|
|
|
|
|
|
|
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|
Non-performing assets (NPA) |
$ |
211,921 |
|
|
$ |
217,199 |
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|
$ |
241,512 |
|
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(2 |
) |
% |
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|
(12 |
) |
% |
|
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|
NPA % (a) |
|
1.15 |
|
% |
|
1.25 |
|
% |
|
1.44 |
|
% |
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Key Ratios & Other |
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Return on average assets (annualized) (b) |
|
0.78 |
|
% |
|
0.99 |
|
% |
|
0.83 |
|
% |
|
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|
|
|
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|
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|
Return on average common equity (annualized) (c) |
|
8.23 |
|
% |
|
10.83 |
|
% |
|
8.27 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest margin (d) |
|
2.82 |
|
% |
|
2.85 |
|
% |
|
2.86 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency ratio (e) |
|
81.94 |
|
% |
|
74.54 |
|
% |
|
74.40 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tier 1 ratio (f) |
|
11.80 |
|
% |
|
12.11 |
|
% |
|
14.46 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market capitalization (millions) |
$ |
3,464.3 |
|
|
$ |
3,321.5 |
|
|
$ |
3,180.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
Certain previously reported amounts have been reclassified to agree with current
presentation. |
NM - Not meaningful |
* Amount is less than one percent. |
(a) NPAs related to the loan portfolio over period-end
loans plus foreclosed real estate and other assets. |
(b) Calculated using net income. |
(c) Calculated using net income available to common
shareholders. |
(d) Net interest margin is computed using net interest
income adjusted to a fully taxable equivalent ('FTE") basis assuming a statutory federal income tax rate of 35 percent and,
where applicable, state income taxes. |
(e) Noninterest expense divided by total revenue excluding
securities gains/(losses). |
(f) Current quarter is an estimate. |
|
Use
of non-GAAP measures
Certain
measures are included in this release that are non-GAAP, meaning they are not presented in accordance with generally accepted
accounting principles (GAAP) in the U.S. First Horizon's management believes such measures are relevant to understanding
the results of the company. The non-GAAP items presented in this release are net income available to common excluding notable
items and diluted earnings per share excluding notable items. These measures are reported to First Horizon's management and board
of directors through various internal reports. Non-GAAP measures are not formally defined by GAAP or codified in the federal banking
regulations, and other entities may use calculation methods that differ from those used by First Horizon. The reconciliation of
non-GAAP to GAAP measures and presentation of the most comparable GAAP items can be found in this table:
Non-GAAP
to GAAP Reconciliation
|
|
|
|
(Dollars and shares in thousands,
except per share data) |
|
2015 |
|
|
|
Adjusted Net Income Available
to Common (Non-GAAP) |
Income/(loss) before income taxes (GAAP) |
$ |
108,254 |
|
Less: Notable items (GAAP) (a) |
|
(182,000 |
) |
Adjusted income/(loss) before income taxes (Non-GAAP) |
|
290,254 |
|
Adjusted provision/(benefit) for income taxes
(Non-GAAP) (b) |
|
81,510 |
|
Adjusted net income/(loss) (Non-GAAP) |
|
208,744 |
|
Net income attributable to noncontrolling interest (GAAP) |
|
11,434 |
|
Preferred stock dividends (GAAP) |
|
6,200 |
|
Adjusted net income/(loss) available to common shareholders (Non-GAAP) |
$ |
191,110 |
|
Adjusted diluted shares (thousands) (Non-GAAP) |
|
236,266 |
|
Adjusted diluted EPS (Non-GAAP) |
$ |
0.81 |
|
(a) 2015 notable items include $188.3 million related
to litigation settlements/accruals, $(8.3) million related to an employee benefit plan amendment, $(5.8) million related to
the retirement of trust preferred debt, $5.0 million related to TrustAtlantic acquisition expenses, and $2.8 million related
to the impairment of a tax credit investment. |
(b) 2015 notable items have been adjusted using an
incremental tax rate of approximately 39 percent. |
|
Conference
call
Management will hold a conference call at 8:30 a.m. Central Time today to review earnings and performance trends. There will also
be a live webcast accompanied by the slide presentation available in the investor relations section of www.FirstHorizon.com.
The call and slide presentation may involve forward-looking information, including guidance.
Participants
can call toll-free starting at 8:15 a.m. by dialing 888-317-6003 and entering pin number 0228490. The number for international
participants is 412-317-6061. Participants can also listen to the live audio webcast with the accompanying slide presentation
through the website. A replay will be available from noon today until 8:00 a.m. Nov. 3. To listen to the replay, dial 877-344-7529
or 412-317-0088. The access code is 10073479. The event also will be archived and available on the website by midnight Central
Time tomorrow.
Other
information
This press release contains forward-looking statements involving significant risks and uncertainties. A number of important factors
could cause actual results to differ materially from those in the forward-looking information. Those factors include general economic
and financial market conditions, including expectations of and actual timing and amount of interest rate movements including the
slope of the yield curve, competition, ability to execute business plans, geopolitical developments, recent and future legislative
and regulatory developments, inflation or deflation, market (particularly real estate market) and monetary fluctuations, natural
disasters, customer, investor and regulatory responses to these conditions and items already mentioned in this press release,
as well as critical accounting estimates and other factors described in First Horizon's annual report on Form 10-K and other recent
filings with the SEC. First Horizon disclaims any obligation to update any such factors or to publicly announce the result of
any revisions to any of the forward-looking statements included herein or therein to reflect future events or developments or
changes in expectations.
Debt
Investor Materials
First Horizon expects to post additional materials for debt investors Jan. 29 in the investor relations section of www.FirstHorizon.com
First Horizon will also provide these materials to analysts at upcoming meetings. The debt investor materials posted may contain
forward-looking statements, including guidance, involving significant risks and uncertainties, which will be identified by words
such as "believe," "expect," "anticipate," "intend," "estimate," "should," "is likely," "will," "going forward" and other expressions
that indicate future events and trends and may be followed by or reference cautionary statements. A number of factors could cause
actual results to differ materially from those in the forward-looking information. These factors are outlined in our most recent
earnings press release and in more detail in our most current 10-Q and 10-K reports. First Horizon disclaims any obligation to
update any of the forward-looking statements that are made from time to time to reflect future events or developments or changes
in expectations.
About
First Horizon
The 4,300 employees of First Horizon National Corp. (NYSE:FHN) provide financial services through more than 170 bank locations
in and around Tennessee and 26 FTN Financial offices in the U.S. The company was founded during the Civil War in 1864 and has
the 14th oldest national bank charter in the country. First Tennessee has the largest deposit market share in Tennessee and
one of the highest customer retention rates of any bank in the country. FTN Financial is a capital markets industry leader
in fixed income sales, trading and strategies for institutional customers in the U.S. and abroad. First Horizon has been recognized
as one of the nation's best employers by Forbes, Working Mother and American Banker magazines. More information is available at www.FirstHorizon.com.
FHN-G
First Horizon Investor Relations, Aarti Bowman, (901) 523-4017
First Horizon Media Relations, Jack Bradley, (901) 523-4813
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