First Horizon National Corporation (NYSE:FHN) Q4 2014 Earnings Conference Call - Final Transcript

Jan 23, 2015 • 09:30 am ET

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First Horizon National Corporation (NYSE:FHN) Q4 2014 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good morning and welcome to the First Horizon National Corp. Fourth Quarter Earnings Conference Call.

All participants will be in listen-only mode.

[Operator Instructions]

Please note this event is being recorded. I would now like to turn the conference over to Aarti Bowman. Please go ahead.

Executive
Aarti Bowman

Thank you, Amy. Please note that the earnings release, financial supplement and slide presentation we'll use in this call this morning are posted on the Investor Relations section of our website at www.firsthorizon.com. In this call, we will mention forward-looking and non-GAAP information. Actual results may differ from the forward-looking information for a number of reasons outlined in our earnings announcement materials and our most annual and quarterly reports.

Our forward-looking statements reflect our views today and we are not obligated to update them. The non-GAAP information is identified as such in our earnings announcement materials and in the slide presentation for this call and is reconciled to GAAP information in those materials. Also, please remember that this webcast on our website is the only authorized record of this call. This morning's speakers include our CEO, Bryan Jordan; and our CFO, BJ Losch. Additionally, our Chief Credit Officer, Susan Springfield, will be available with Bryan and BJ for questions.

I'll now turn it over to Bryan.

Executive
William C. Losch

Thanks, Aarti. Good morning, everyone and thank you for joining our call. I'm very pleased with what we accomplished in 2014 and I am optimistic about our prospects for further progress in 2015. Last year we profitably grew our balance sheet by increasing loans in the bank and ended the year with the strong pipeline. We've reduced expenses and improved efficiency while continuing to invest in our core businesses. We made significant headway towards putting legacy issues behind us by reaching the settlement with Freddie Mac by resolving the FHFA litigation, reducing nonstrategic loans and selling mortgage servicing. We continued to return capital to shareholders. We repurchased 3 million common shares in 2014.

Since 2011, we've bought back 31 million shares reflecting an 11% share count reduction. We acquired bank branches in Tennessee adding $440 million of deposits and agreed to acquire TrustAtlantic Bank in North Carolina. We also just announced that we increased our annual dividend rate by 20% from $0.20 per share to $0.24 per share. I feel good about our positioning as we kick off 2015. We are seeing moderate, but steady, growth in our markets. And believe that we are set to take additional profitable market share while maintaining loan quality.

Year-over-year the Regional Bank grew average loans 10% despite strong competition. Our specialty lending areas drove the growth with Private Client/Wealth loans up 10%, asset-based lending increased 15% and commercial real estate lending up 31%. Our efforts in our growth markets are paying off as well, with Mid-Atlantic loans up 25% and Middle Tennessee up 10%. At FTN Financial, average daily fixed income revenues were steady from third to fourth quarter 2014 and are likely to stay in this general range until market conditions