* Q4 loss $0.20/shr vs loss $0.30/shr
* Q4 includes $63 mln cost from TARP exit
* Sees M&A activity in 2011
(Adds conference call details, analyst comments)
By Rachel Chitra
BANGALORE, Jan 21 First Horizon National Corp
(FHN.N) swung back to loss after two quarters of profit, as the
bank repaid U.S. government's bailout funds.
The Memphis, Tennessee-based regional lender said it plans
to redeploy capital on possible acquisitions in 2011.
"They still have not got clarity on dividend payout for
2011 from the regulators. So they are currently looking at
expansion in the Tennessee market," Howe Barnes Hoefer & Arnett
analyst William Wallace said.
Listing possible targets in Tennessee, North Carolina and
Georgia, Wallace said Nashville, Tennessee-based Pinnacle
Financial Partners (PNFP.O) could be the most meaningful
acquisition from an earnings perspective.
First Horizon posted fourth-quarter net loss available to
common shareholders of $48.7 million, or 20 cents a share,
compared with a loss of $70.6 million, or 30 cents a share, a
year ago. [ID:nASA01EVG]
The quarterly results included a negative impact of $63
million related to exiting the Troubled Asset Relief Program.
"We expect a slow economic recovery and low interest rates
likely to persist in 2011, so we are looking at controlling
costs and making investments more efficient," First Horizon
Chief Executive Bryan Jordan said on a call with analysts.
The company expects expenses to be lower in 2011 and sees a
continued decline in its credit costs. For October-December,
non-interest expenses fell 14 percent to $334.8 million.
Non-interest income fell 21 percent to $195.2 million,
pushing total revenue down 10 percent to $393.1 million despite
higher gains made on securities this year.
"Revenue is under pressure. We see their loan balances
declining in 2011, including residential loans and commercial
real estate (CRE) loans. The only exception would be commercial
and industrial loans (C&I) which could see growth in 2011,"
analyst Wallace said.
Shares of the company were trading at $11.99 on Friday
afternoon on the New York Stock Exchange. Their value has
gained 27 percent since December when it repaid $866.5 million
to retire Treasury preferred shares.
(Reporting by Sweta Singh & Rachel Chitra in Bangalore;
Editing by Don Sebastian) ((firstname.lastname@example.org ;
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