Core Business Profitability Up, Non-Performing Loans Down at First Horizon

MEMPHIS, Tenn., Oct. 17, 2011 (GLOBE NEWSWIRE) -- Third quarter financial
results show First Horizon National Corp. (NYSE:FHN) ramped up core business
profitability and significantly lowered non-performing loans. Balance sheet
trends generally were favorable and the company continued to make progress on
lowering expenses in core businesses, but environmental costs remained elevated
primarily from increased GSE-related mortgage repurchase provision expenses.
First Horizon has also launched a program to repurchase up to $100 million of
its common stock in the open market or in privately negotiated transactions,
subject to market conditions, by the end of August 2012.

"We remain focused on controlling what we can control in this challenging
environment. Our third quarter results show that we're making solid progress in
strengthening First Tennessee, our regional banking business, and FTN Financial,
our capital markets business," said Bryan Jordan, First Horizon's CEO. "I'm
proud of the work our employees do day in and day out to help our customers have
an unparalleled experience when they do business with us."

Financial results

-- Net income available to common shareholders improved to $36.1 million,
compared to second quarter's net income of $20.0 million.
-- Net income in core businesses improved to $94.4 million, up from $26.9
million in the second quarter.
-- Diluted earnings per share were $0.14 for the quarter, up from last
quarter's EPS of $0.08.

3Q11
Change
Key Performance Ratios & Other Data vs.

-------------------------------------- --------- -------- -------
--------------

(Shares in thousands)/(Unaudited) 3Q11 2Q11 3Q10 2Q11
3Q10
-------------------------------------- --------- -------- ------- ------
------
Diluted EPS $0.14 $0.08 $0.07 75 %
NM
Diluted shares 262,803 262,756 238,867 *
10 %
Period-end shares outstanding 263,619 263,699 237,061 *
11 %
Return on average assets (annualized)

(a) 0.62% 0.37% 0.52%

Return on average common equity

(annualized) (b) 5.90% 3.36% 2.86%

Net interest margin (c) 3.23% 3.20% 3.23%

Efficiency ratio (d) 89.13% 95.56% 79.09%

Full time equivalent employees 4,748 4,950 5,506 (4)%
(14)%
-------------------------------------- --------- -------- ------- ------
------
NM - Not meaningful

* Amount is less than one percent.

(a) Calculated using net income.

(b) Calculated using net income available to common shareholders.

(c) Net interest margin is computed using total net interest income adjusted
for
fully taxable equivalent ("FTE"). Refer to the Non-GAAP to GAAP
Reconciliation at
the end of this release.

(d) Noninterest expense divided by total revenue excluding securities

gains/(losses).

Core business strength

-- Regional bank pre-tax income was up 26 percent compared to last quarter,
and total revenue grew 2 percent, driven by higher net interest income
and steady fee income. Period-end loans improved 5 percent from last
quarter, driven by loans to mortgage companies and corporate borrowers
and asset-based lending. According to recent FDIC data, First
Tennessee's deposits in Tennessee improved 6.5 percent over last year,
more than two and one-half times the growth rate in First Tennessee's
markets. In Middle Tennessee, deposits grew nearly 7.5 percent, the
fastest among the top banks.
-- Capital markets pre-tax income was $27.9 million in the third quarter,
compared to a pre-tax loss of $19.9 million in the second quarter, which
included a $36.7 million litigation expense. Revenues improved 26
percent as fixed income average daily revenue increased to $1.4 million
in the third quarter from $1.1 million in the second quarter.
-- In the corporate segment, pre-tax income was $18.6 million for the third
quarter, which included $35.1 million of securities gains from the sale
of Visa stock. That compares to a pre-tax loss of $26.8 million in the
second quarter.
-- The pre-tax loss in the non-strategic segment for the third quarter was
$97.9 million, compared to a $12.6 million loss in the second quarter.
The higher loss was driven primarily by an increase in mortgage
repurchase expense of $28 million and an increase in provision for loans
losses due to non-performing loan sales.

3Q11 Change

Income Statement Highlights vs.

--------------------------------- --------- -------- --------
--------------

(Thousands)/(Unaudited) 3Q11 2Q11 3Q10 2Q11
3Q10
--------------------------------- --------- -------- -------- ------
------
Net interest income $176,340 $172,860 $186,143 2 %
(5)%
Noninterest income 185,725 187,592 245,633 (1)%
(24)%

Securities gains/(losses), net 35,162 1 (2,928) NM
NM
--------------------------------- --------- -------- -------- ------
------

Total revenue 397,227 360,453 428,848 10 %
(7)%
--------------------------------- --------- -------- -------- ------
------
Noninterest expense 322,708 344,455 341,490 (6)%
(6)%

Provision for loan losses 32,000 1,000 50,000 NM
(36)%
--------------------------------- --------- -------- -------- ------
------
Income before income taxes 42,519 14,998 37,358 NM 14
%

Provision/(benefit) for income

taxes 8,367 (4,167) 3,290 NM
NM
--------------------------------- --------- -------- -------- ------
------
Income from continuing operations 34,152 19,165 34,068 78 %
*

Income/(loss) from discontinued

operations, net of tax 4,828 3,671 (358) 32 %
NM
--------------------------------- --------- -------- -------- ------
------
Net income 38,980 22,836 33,710 71 % 16
%

Net income attributable to

noncontrolling interest 2,875 2,844 2,875 1 %
*
--------------------------------- --------- -------- -------- ------
------
Net income attributable to

controlling interest 36,105 19,992 30,835 81 % 17
%

Preferred stock dividends -- -- 14,960 NM
NM
--------------------------------- --------- -------- -------- ------
------

Net income available to common

shareholders $36,105 $19,992 $15,875 81 %
NM
--------------------------------- --------- -------- -------- ------
------
NM - Not meaningful

* Amount is less than one

percent.

Continued improvement in credit quality

-- First Horizon saw continued improvement in credit quality in the third
quarter.
-- The total provision for loan losses in the third quarter was $32
million. The increase in provision reflects losses of $36 million
related to the sales of non-performing loans.
-- The loans sold accounted for 45 percent of total net charge-offs.

3Q11 Change

Asset Quality Highlights vs.

--------------------------------- --------- -------- --------
--------------

(Dollars in

Thousands)/(Unaudited) 3Q11 2Q11 3Q10 2Q11
3Q10
--------------------------------- --------- -------- -------- ------
------
Allowance for loan losses $449,645 $524,091 $719,899 (14)%
(38)%
Allowance / period-end loans 2.77% 3.26% 4.22%

Net charge-offs $106,446 $66,037 $111,370 61 %
(4)%
Net charge-offs (annualized) /

average loans 2.65% 1.67% 2.60%

Non-performing assets (NPA) $582,571 $747,860 $919,242 (22)%
(37)%

NPA % (a) 3.02% 4.09% 5.00%

--------------------------------- --------- -------- -------- ------
------
(a) NPAs related to the loan portfolio over period-end loans plus foreclosed

real estate and other assets.

Efficiency

-- The company remains focused on enhancing productivity, with a target
efficiency ratio of 60 percent to 65 percent, while continuing to
deliver unparalleled service to customers. In the regional bank, which
makes up nearly half of total assets, the efficiency ratio improved to
65.83 percent and revenue per full-time equivalent employee (FTE)
increased 5 percent from last quarter.
-- Company-wide expenses improved 6 percent percent from the second
quarter.

Balance Sheet Highlights & Capital
3Q11 Change
Ratios
vs.
---------------------------------------- ------------ -----------
----------- --------------

(Period-End, Dollars in

Thousands)/(Unaudited) 3Q11 2Q11 3Q10
2Q11 3Q10
---------------------------------------- ------------ -----------
----------- ------ ------
Total loans, net of unearned income $16,241,402 $16,061,646
$17,059,489 1 % (5)%
Total deposits 15,698,255 15,896,027
14,975,920 (1)% 5 %
Total assets 25,571,469 25,054,066
25,384,181 2 % 1 %
Total liabilities 22,828,239 22,372,684
22,077,293 2 % 3 %
Total equity 2,743,230 2,681,382
3,306,888 2 % (17)%
Book value per common share $9.29 $9.05
$9.28
Tangible book value per common share (a) $8.68 $8.43
$8.45
Tangible common equity/tangible assets

(a) 9.00% 8.93%
7.96%

Tier 1 capital ratio (b) 14.47% 14.39%
17.34%
---------------------------------------- ------------ -----------
----------- ------ ------
(a) Refer to the Non-GAAP to GAAP Reconciliation at the end of this release.

(b) Current quarter is an estimate.

Use of non-GAAP measures

Certain measures are included in the text and tables of this release that are
non-GAAP, meaning they are not presented in accordance with generally accepted
accounting principles (GAAP) in the U.S. FHN's management believes such measures
are relevant to understanding the capital position and results of the company.
The non-GAAP items presented in this release are net income related to core
businesses, tangible common equity to tangible assets, tangible book value per
common share and net interest margin computed using net interest income adjusted
for FTE (fully taxable equivalent). These measures are reported to FHN's
management and board of directors through various internal reports.
Additionally, disclosure of the non-GAAP capital ratios provides a meaningful
base for comparability to other financial institutions as these ratios have
become an important measure of the capital strength of banks as demonstrated by
the inclusion in the stress tests administered by the United States Treasury
Department under the Capital Assistance Program. 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 FHN.
The reconciliation of non-GAAP to GAAP measures and presentation of the most
comparable GAAP items is contained in the following table.

NON-GAAP to GAAP Reconciliation

--------------------------------------- ------------ -----------
-----------

(Period End, Dollars in Thousands)

(Unaudited) 3Q11 2Q11 3Q10

--------------------------------------- ------------ -----------
-----------
Tangible Common Equity (Non-GAAP)

(A) Total equity (GAAP) $2,743,230 $2,681,382
$3,306,888
Less: Preferred stock capital surplus -

CPP -- --
810,974

Less: Noncontrolling interest (a) 295,165 295,165
295,165
--------------------------------------- ------------ -----------
-----------
(B) Total common equity 2,448,065 2,386,217
2,200,749

Less: Intangible assets (GAAP) (b) 160,902 164,067
196,443
--------------------------------------- ------------ -----------
-----------

(C) Tangible common equity (Non-GAAP) $2,287,163 $2,222,150
$2,004,306
--------------------------------------- ------------ -----------
-----------

Tangible Assets (Non-GAAP)

(D) Total assets (GAAP) $25,571,469 $25,054,066
$25,384,181

Less: Intangible assets (GAAP) (b) 160,902 164,067
196,443
--------------------------------------- ------------ -----------
-----------

(E) Tangible assets (Non-GAAP) $25,410,567 $24,889,999
$25,187,738
--------------------------------------- ------------ -----------
-----------

Period-end Shares Outstanding

(F) Period-end shares outstanding 263,619 263,699
237,061
--------------------------------------- ------------ -----------
-----------

Ratios

(C)/(E) Tangible common equity to

tangible assets (TCE/TA) (Non-GAAP) 9.00% 8.93%
7.96%
(A)/(D) Total equity to total assets

(GAAP) 10.73% 10.70%
13.03%
(C)/(F) Tangible book value per common

share (Non-GAAP) $8.68 $8.43
$8.45

(B)/(F) Book value per common share

(GAAP) $9.29 $9.05
$9.28
--------------------------------------- ------------ -----------
-----------

Net interest income adjusted for impact

of FTE (Non-GAAP)

Total Consolidated:

Net interest income (GAAP) $176,340 $172,860
$186,143

Fully taxable equivalent ("FTE")

adjustment 1,555 1,497
791
--------------------------------------- ------------ -----------
-----------

Net interest income adjusted for impact

of FTE (Non-GAAP) $177,895 $174,357
$186,934
--------------------------------------- ------------ -----------
-----------

Net income in core businesses

(Non-GAAP)

Regional Banking - Net income $59,214 $47,072
$32,897
Capital Markets - Net income/(loss) 17,238 (12,155)
26,991

Corporate - Net income/(loss) 17,916 (7,993)
1,134
--------------------------------------- ------------ -----------
-----------
Net income in core businesses

(Non-GAAP) $94,368 $26,924
$61,022

Non-Strategic - Net loss (55,388) (4,088)
(27,312)
--------------------------------------- ------------ -----------
-----------

Net income (GAAP) $38,980 $22,836
$33,710
--------------------------------------- ------------ -----------
-----------
(a) Included in total equity on the

consolidated condensed balance sheet.

(b) Includes goodwill and other

intangible assets, net of

amortization.

Conference Call

Management will hold a conference call at 8:00 a.m. Central Time today to review
earnings and performance trends. There will also be a live webcast accompanied
by a slide presentation, and the financial supplement and slide presentation are
available in the events and presentations section of http://ir.fhnc.com. Callers
wishing to participate may call toll-free starting at 7:45 a.m. Central Time by
dialing 877-303-6618. The number for international participants is 224-357-2205.
The conference ID number is 13901680.

Participants can also listen to the live audio webcast with the accompanying
slide presentation through the investor relations section of www.fhnc.com. A
replay will be available from noon Central Time today until 11:59 p.m. Oct. 24.
To listen to the replay, callers should dial 855-859-2056 or 404-537-3406. The
passcode is 13901680. The event also will be archived and available by midnight
tonight in the events and presentations section of http://ir.fhnc.com.

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 FHN's annual report on Form 10-K and other recent filings with the
SEC. FHN 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.

About First Horizon

The 4,800 employees of First Horizon National Corp. (NYSE:FHN) provide financial
services through more than 170 bank locations in and around Tennessee and 18 FTN
Financial Group offices in the U.S. and abroad. First Tennessee Bank has the
leading combined market deposit share in the counties where it does business 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 clients in the U.S. and abroad. FHN has been
recognized as one of the nation's best employers by AARP and Working Mother
magazines. More information is available at www.fhnc.com.

FHN-G

CONTACT: Jack Bradley, Media Relations, (901)523-4813
Aarti Bowman, Investor Relations, (901)523-4017