(Update 1 shows mortgage information from First Horizon's earnings statement)
First Horizon National Corp. (FHN)
reported massive losses in the third quarter 2008 after the complete sale of of mortgage operations outside Tennessee and mortgage banking servicing operations including $19.1 billion billion of servicing to MetLife Inc. (MET)
The net loss totaled $113.8 million - 59 cents per share - for the third quarter, up nearly 500 percent from last quarter's $19.1 million net loss. Pre-tax loss totaled $203 million, up from the $47.9 million reported for the second quarter.
Total deposits continued to decline through 2008.
"Like other financial services companies, we’ve faced an extremely challenging operating environment, yet we’ve continued to take steps to maintain sufficient capital, liquidity and reserves throughout these tough times," said CEO Bryan Jordan in a media statement. "In the third quarter we completed the sale of our mortgage business outside Tennessee and further reduced our balance sheet risk."
First Horizon announced a $2.7 billion reduction of total assets in its third quarter earnings report Friday. It also said it's on track for an additional reduction of $1 to $2 billion in total assets by the end of 2008.
Net charge-offs increased to $154.7 million, up 21 percent from $127.7 million in the second quarter.
Loan loss allowance increased $185.3 million to 3.52 percent of total loans, up from 2.59 percent of total loans allowed in the second quarter.
"Provisioning for both third and second quarters of 2008 reflects continued aggressive efforts to address problem loans while addressing portfolio stress from declining economic conditions, especially in national construction, home equity and C&I loans," First Horizon said in a press statement.
Mortgage banking income was $46.4 million, down from last quarter's $69.2, a drop "consistent with the decline in the warehouse." Mortgage divestiture net of gains totaled $30.5 million.
"We’ll continue our emphasis on aggressively addressing problem loans, reducing our national real estate businesses and growing our already powerful banking business in Tennessee," Jordan said. "We’re also carefully examining opportunities to participate in the new programs offered by the Treasury, which we think are steps in the right direction to restoring confidence in the financial system."
Read First Horizon's full statement>>
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