Navigating Through Rough Waters
September 26th, 2007
As many of you know, First Horizon is a full service banking institution with a long and prominent history dating back to . Throughout it's 100 plus years of banking, First Horizon has made many strategic moves to insure it's independence. Today is no exception, as stated by a letter from the CEO of First Horizon, Jerry Baker:
"First Horizon continues to make progress in adjusting to the current market conditions and preparing for the future. The next step in this process is the sale of First Horizon Banks. I have been confident there would be institutions that would find these facilities and employees highly desirable. The news release below announces agreements, primarily with M&T, Sterling and Fifth Third, that are important and exciting for everyone involved.
I also believe that as we make our company more efficient and complete the sale of these banks and the other changes discussed in recent Updates, we should be ready for profitable growth and expansion. Sometimes it is necessary to take a step or two backward to be able to successfully take many steps forward. I am anxious for us to move forward when we are prepared and the time is right. Thanks for all you are doing for First Horizon, First Tennessee and FTN Financial."
NEWS RELEASE:
First Horizon National Corp. announces sale of First Horizon Bank branches
MEMPHIS, Tenn. --- First Horizon National Corp.’s (NYSE: FHN) principal banking subsidiary, First Tennessee Bank National Association, has reached agreements for the sale of all 34 of its First Horizon Bank branches. Financial details of the agreements were not disclosed, and all of the sales are expected to close by first quarter 2008. In aggregate, these transactions are expected to result in a small gain for First Horizon. Each of the agreements is to purchase certain loans and fixed assets, including the branch locations, and to assume all of the deposit relationships of the First Horizon Bank branches being purchased.
· M&T Bank., a subsidiary of M&T Bank Corp. (NYSE: MTB) of Buffalo, N.Y., has signed a definitive agreement to purchase the 13 First Horizon Bank branches in Northern Virginia and Maryland.
· Sterling Bank (NASDAQ: SBIB) of Houston, Texas, has signed a definitive agreement to purchase the 10 branch locations in the Dallas/Ft. Worth Metroplex market.
· Nine Georgia branches of First Horizon Bank in the Atlanta market will be purchased by Fifth Third Bank (an indirectly wholly owned subsidiary of Fifth Third Bancorp, NASDAQ: FITB) of Cincinnati.
· The two remaining Georgia branches – in Dallas, Ga. , and Douglasville, Ga., -- are being purchased by wholly owned subsidiaries of FMCB Holdings Inc. of Senoia, Ga.
The sales are part of an ongoing effort at First Horizon to redeploy capital to its higher-return businesses. On July 19 First Horizon announced that it would pursue the sale, closure or consolidation of the 34 First Horizon Bank branches in its four full-service banking markets outside Tennessee. First Horizon Home Loans will continue to offer mortgage and construction financing in these markets.
“The prompt and successful negotiation of these sales is a testament to the work that our First Horizon Bank employees did in building their business in these markets,” said Charles Burkett, president of Tennessee and national banking for First Horizon National Corp. “The sale will allow us to focus capital on businesses that are creating higher returns for us right now.”