Exhibit 99.1
FOURTH QUARTER 2005
FINANCIAL SUPPLEMENT
The following supplement is provided to assist in your financial analysis.
If you need further information, please contact:
Mark Yates, SVP
Investor Relations
901/523-4068
myates@firsthorizon.com
CONSOLIDATED SUMMARY | ||||||||
Quarterly, Unaudited | ||||||||
(Thousands) | 4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | |||
Net interest income | $254,811 | $260,161 | $241,608 | $227,447 | $228,446 | |||
Noninterest income | 336,586 | 369,943 | 343,312 | 343,464 | 313,682 | |||
Divestitures | 7,029 | - | - | - | 3,200 | |||
Security G/L | (181) | (406) | 75 | (66) | (3,734) | |||
Total revenue | 598,245 | 629,698 | 584,995 | 570,845 | 541,594 | |||
Noninterest expense | 420,827 | 436,219 | 419,031 | 394,855 | 382,688 | |||
Provision | 16,175 | 22,608 | 15,786 | 13,109 | 11,783 | |||
Pretax income | 161,243 | 170,871 | 150,178 | 162,881 | 147,123 | |||
Income taxes | 48,256 | 54,674 | 47,473 | 53,672 | 43,971 | |||
Income before cumulative effect | 112,987 | 116,197 | 102,705 | 109,209 | 103,152 | |||
Cumulative effect of changes in accounting | ||||||||
principle, net of tax | (3,098) | - | - | - | - | |||
Net income | $109,889 | $116,197 | $102,705 | $109,209 | $103,152 | |||
Diluted shares | 129,476 | 129,359 | 128,914 | 128,032 | 127,719 | |||
EPS before cumulative effect of changes in | ||||||||
accounting principle | $0.87 | $0.90 | $0.80 | $0.85 | $0.81 | |||
EPS | $0.85 | $0.90 | $0.80 | $0.85 | $0.81 | |||
Tax rate | 30% | 32% | 32% | 33% | 30% | |||
Efficiency ratio | 70% | 69% | 72% | 69% | 71% | |||
Certain previously reported amounts have been reclassified to agree with current presentation. |
1
STATEMENTS OF INCOME | ||||||||
Quarterly, Unaudited | ||||||||
(Thousands) | 4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | |||
Interest income | $519,474 | $497,439 | $438,385 | $384,876 | $334,789 | |||
Less interest expense | 264,663 | 237,278 | 196,777 | 157,429 | 106,343 | |||
Net interest income | 254,811 | 260,161 | 241,608 | 227,447 | 228,446 | |||
Provision for loan losses | 16,175 | 22,608 | 15,786 | 13,109 | 11,783 | |||
Net interest income after | ||||||||
provision for loan losses | 238,636 | 237,553 | 225,822 | 214,338 | 216,663 | |||
Noninterest income: | ||||||||
Mortgage banking | 114,713 | 140,482 | 108,993 | 118,762 | 94,771 | |||
Capital markets | 80,896 | 82,158 | 94,789 | 95,162 | 76,522 | |||
Deposit transactions | ||||||||
and cash management | 42,196 | 41,268 | 39,471 | 33,255 | 37,695 | |||
Merchant processing | 22,202 | 22,680 | 23,239 | 20,460 | 19,679 | |||
Insurance commissions | 13,144 | 12,673 | 13,525 | 14,749 | 11,649 | |||
Revenue from loan sales and securitizations | 13,146 | 10,878 | 10,319 | 13,232 | 14,151 | |||
Trust services and investment | ||||||||
management | 10,873 | 11,299 | 11,278 | 11,164 | 11,741 | |||
Gains on divestitures | 7,029 | - | - | - | 3,200 | |||
Securities (losses)/gains, net | (181) | (406) | 75 | (66) | (3,734) | |||
Other | 39,416 | 48,505 | 41,698 | 36,680 | 47,474 | |||
Total noninterest income | 343,434 | 369,537 | 343,387 | 343,398 | 313,148 | |||
Adjusted gross income after | ||||||||
provision for loan losses | 582,070 | 607,090 | 569,209 | 557,736 | 529,811 | |||
Noninterest expense: | ||||||||
Employee compensation, | ||||||||
incentives and benefits | 245,224 | 261,906 | 248,064 | 242,986 | 228,206 | |||
Occupancy | 28,427 | 26,547 | 26,548 | 24,516 | 22,875 | |||
Operations services | 20,086 | 20,660 | 20,328 | 18,477 | 18,379 | |||
Equipment rentals, depreciation, | ||||||||
and maintenance | 19,958 | 19,668 | 19,406 | 18,085 | 18,633 | |||
Communications and courier | 14,720 | 14,809 | 13,684 | 12,893 | 12,446 | |||
Amortization of intangible assets | 3,414 | 3,598 | 3,360 | 3,362 | 3,014 | |||
Other | 88,998 | 89,031 | 87,641 | 74,536 | 79,135 | |||
Total noninterest expense | 420,827 | 436,219 | 419,031 | 394,855 | 382,688 | |||
Pretax income | 161,243 | 170,871 | 150,178 | 162,881 | 147,123 | |||
Provision for income taxes | 48,256 | 54,674 | 47,473 | 53,672 | 43,971 | |||
Income before cumulative effect of changes | ||||||||
in accounting principle | 112,987 | 116,197 | 102,705 | 109,209 | 103,152 | |||
Cumulative effect of changes in accounting | ||||||||
principle, net of tax | (3,098) | - | - | - | - | |||
Net income | $109,889 | $116,197 | $102,705 | $109,209 | $103,152 | |||
Diluted earnings per common share before | ||||||||
cumulative effect of changes in | ||||||||
accounting principle | $ .87 | $ .90 | $ .80 | $ .85 | $ .81 | |||
Diluted earnings per common share | .85 | .90 | .80 | .85 | .81 | |||
Dividends declared | .45 | .43 | .43 | .43 | .43 | |||
SELECTED FINANCIAL RATIOS: | ||||||||
Return on average assets | 1.16% | 1.21% | 1.14% | 1.30% | 1.40% | |||
Return on average shareholders' equity | 19.4 | 21.1 | 19.6 | 21.8 | 20.8 | |||
Certain previously reported amounts have been reclassified to agree with current presentation. |
2
OTHER INCOME AND OTHER EXPENSE | ||||||||
Quarterly, Unaudited | ||||||||
(Thousands) | 4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | |||
All other income: | ||||||||
Cardholder fees | $7,486 | $7,070 | $6,733 | $6,092 | $6,405 | |||
Other service charges | 5,531 | 5,968 | 5,753 | 5,218 | 5,270 | |||
Remittance processing | 3,926 | 3,908 | 3,790 | 3,787 | 3,888 | |||
Check clearing fees | 1,801 | 1,885 | 1,778 | 1,869 | 2,340 | |||
Other | 20,672 | 29,674 | 23,644 | 19,714 | 29,571 | |||
Total | $39,416 | $48,505 | $41,698 | $36,680 | $47,474 | |||
All other expense: | ||||||||
Advertising and public relations | $11,082 | $11,254 | $12,518 | $11,535 | $8,585 | |||
Legal and professional fees | 12,222 | 12,439 | 11,829 | 8,749 | 11,816 | |||
Travel and entertainment | 8,062 | 7,721 | 8,898 | 7,445 | 8,684 | |||
Computer software | 8,452 | 8,333 | 8,845 | 7,024 | 7,199 | |||
Contract employment | 7,818 | 7,913 | 8,631 | 6,700 | 7,877 | |||
Supplies | 4,499 | 4,737 | 4,040 | 4,360 | 4,399 | |||
Fed services fees | 1,852 | 1,885 | 1,905 | 1,926 | 1,979 | |||
Foreclosed real estate | 1,835 | 3,547 | (614) | 2,497 | 2,759 | |||
Deposit insurance premium | 782 | 795 | 746 | 689 | 923 | |||
Charitable contributions | 419 | 950 | 460 | 374 | 339 | |||
Other | 31,975 | 29,457 | 30,383 | 23,237 | 24,575 | |||
Total | $88,998 | $89,031 | $87,641 | $74,536 | $79,135 | |||
Certain previously reported amounts have been reclassified to agree with current presentation. |
3
AVERAGE STATEMENTS OF CONDITION | |||||||
Quarterly, Unaudited | |||||||
(Millions) | 4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | ||
Assets: | |||||||
Earning assets: | |||||||
Loans, net of unearned income | $19,952.1 | $18,722.0 | $17,782.3 | $16,680.6 | $16,836.4 | ||
Investment securities | 2,858.4 | 2,934.1 | 2,931.3 | 2,794.8 | 2,150.6 | ||
Loans held for sale | 5,758.8 | 6,936.8 | 6,055.9 | 5,315.1 | 4,696.1 | ||
Capital markets securities inventory | 2,160.7 | 2,158.3 | 2,069.1 | 2,235.0 | 856.9 | ||
Mortgage banking trading securities | 360.9 | 271.9 | 292.3 | 288.4 | 249.5 | ||
Other earning assets: | |||||||
Federal funds sold and securities | |||||||
purchased under agreements to resell | 2,086.4 | 2,532.7 | 2,482.6 | 2,047.3 | 783.7 | ||
Investment in bank time deposits | 14.5 | 6.3 | 5.7 | 5.9 | 5.6 | ||
Total other earning assets | 2,100.9 | 2,539.0 | 2,488.3 | 2,053.2 | 789.3 | ||
Total earning assets | 33,191.8 | 33,562.1 | 31,619.2 | 29,367.1 | 25,578.8 | ||
Allowance for loan losses | (190.8) | (176.2) | (169.4) | (164.6) | (165.2) | ||
Cash and due from banks | 781.2 | 769.8 | 727.4 | 729.8 | 779.2 | ||
Premises and equipment, net | 410.4 | 400.5 | 387.5 | 378.0 | 373.7 | ||
Capital markets receivables | 288.3 | 393.5 | 742.2 | 880.5 | 153.4 | ||
Other assets | 3,239.5 | 3,141.3 | 2,975.3 | 2,900.6 | 2,590.0 | ||
Total assets | $37,720.4 | $38,091.0 | $36,282.2 | $34,091.4 | $29,309.9 | ||
Liabilities and shareholders' equity: | |||||||
Interest-bearing deposits: | |||||||
Savings | $ 285.3 | $ 289.7 | $ 294.4 | $ 294.1 | $ 292.6 | ||
Checking interest and money market | 4,409.6 | 4,287.2 | 4,319.5 | 4,273.7 | 3,935.8 | ||
Certificates of deposit under $100,000 | |||||||
and other time | 2,402.9 | 2,278.1 | 2,184.3 | 2,102.4 | 2,065.8 | ||
Total interest-bearing core deposits | 7,097.8 | 6,855.0 | 6,798.2 | 6,670.2 | 6,294.2 | ||
Noninterest-bearing deposits | 5,427.9 | 5,659.0 | 5,167.4 | 4,786.7 | 4,913.7 | ||
Total core deposits | 12,525.7 | 12,514.0 | 11,965.6 | 11,456.9 | 11,207.9 | ||
Certificates of deposit $100,000 and more | 11,393.0 | 11,467.8 | 10,557.3 | 10,147.1 | 8,079.0 | ||
Total deposits | 23,918.7 | 23,981.8 | 22,522.9 | 21,604.0 | 19,286.9 | ||
Federal funds purchased and securities | |||||||
sold under agreements to repurchase | 4,760.6 | 4,913.3 | 4,651.6 | 3,991.2 | 3,731.0 | ||
Trading liabilities | 1,351.8 | 1,665.3 | 1,589.4 | 1,470.5 | 614.8 | ||
Commercial paper and other short-term | |||||||
borrowings | 1,052.3 | 1,230.4 | 998.8 | 691.0 | 161.0 | ||
Term borrowings | 2,665.9 | 2,374.6 | 2,585.2 | 2,616.1 | 2,385.1 | ||
Capital markets payables | 275.7 | 350.5 | 423.8 | 569.8 | 124.0 | ||
Other liabilities | 1,150.5 | 1,093.6 | 1,115.4 | 1,083.4 | 1,033.4 | ||
Preferred stock of subsidiary | 295.3 | 295.3 | 295.4 | 30.0 | .5 | ||
Shareholders' equity | 2,249.6 | 2,186.2 | 2,099.7 | 2,035.4 | 1,973.2 | ||
Total liabilities and shareholders' equity | $37,720.4 | $38,091.0 | $36,282.2 | $34,091.4 | $29,309.9 |
4
PERIOD END STATEMENTS OF CONDITION | |||||||
Quarterly, Unaudited | |||||||
(Millions) | 4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | ||
Assets: | |||||||
Cash and due from banks | $946.4 | $1,037.4 | $989.9 | $773.4 | $638.2 | ||
Federal funds sold and securities | |||||||
purchased under agreements to resell | 1,485.2 | 1,972.3 | 1,911.0 | 1,599.0 | 682.3 | ||
Total cash and cash equivalents | 2,431.6 | 3,009.7 | 2,900.9 | 2,372.4 | 1,320.5 | ||
Investment in bank time deposits | 10.7 | 6.4 | 5.2 | 10.7 | 5.3 | ||
Trading securities | 2,133.4 | 2,013.5 | 2,064.5 | 1,826.6 | 988.0 | ||
Loans held for sale | 4,435.3 | ��5,158.1 | 5,795.5 | 5,277.2 | 5,168.0 | ||
Securities available for sale | 2,912.1 | 2,841.6 | 2,998.1 | 2,899.5 | 2,680.6 | ||
Securities held to maturity | .4 | .4 | .4 | .4 | .4 | ||
Loans, net of unearned income | 20,600.9 | 19,212.1 | 18,428.6 | 17,183.8 | 16,427.7 | ||
Less: Allowance for loan losses | 189.7 | 185.0 | 169.7 | 164.2 | 158.2 | ||
Total net loans | 20,411.2 | 19,027.1 | 18,258.9 | 17,019.6 | 16,269.5 | ||
Capital markets receivables | 511.5 | 1,453.4 | 1,694.7 | 2,435.5 | 276.3 | ||
Mortgage servicing rights, net | 1,314.6 | 1,210.3 | 1,018.0 | 1,135.6 | 1,036.4 | ||
Goodwill | 308.8 | 309.5 | 292.1 | 287.9 | 187.2 | ||
Other intangible assets, net | 85.9 | 86.9 | 86.5 | 89.6 | 34.8 | ||
Premises and equipment, net | 415.0 | 412.0 | 391.1 | 384.5 | 379.4 | ||
Real estate acquired by foreclosure | 27.4 | 27.8 | 27.1 | 25.7 | 27.8 | ||
Other assets | 1,581.2 | 1,485.6 | 1,632.8 | 1,392.2 | 1,397.5 | ||
Total assets | $36,579.1 | $37,042.3 | $37,165.8 | $35,157.4 | $29,771.7 | ||
Liabilities and shareholders' equity: | |||||||
Deposits: | |||||||
Savings | $279.4 | $288.9 | $290.3 | $299.0 | $289.8 | ||
Checking interest and money market | 4,425.7 | 4,331.6 | 4,231.8 | 4,338.5 | 4,220.4 | ||
Certificates of deposit under $100,000 | |||||||
and other time | 2,478.9 | 2,338.4 | 2,223.5 | 2,145.3 | 2,061.2 | ||
Total interest-bearing core deposits | 7,184.0 | 6,958.9 | 6,745.6 | 6,782.8 | 6,571.4 | ||
Noninterest-bearing deposits | 5,322.1 | 5,891.5 | 5,949.6 | 5,508.6 | 4,994.6 | ||
Total core deposits | 12,506.1 | 12,850.4 | 12,695.2 | 12,291.4 | 11,566.0 | ||
Certificates of deposit $100,000 and more | 10,931.7 | 12,497.2 | 8,962.7 | 10,781.0 | 8,216.2 | ||
Total deposits | 23,437.8 | 25,347.6 | 21,657.9 | 23,072.4 | 19,782.2 | ||
Federal funds purchased and securities | |||||||
sold under agreements to repurchase | 3,735.7 | 2,358.0 | 5,459.0 | 2,788.2 | 3,247.0 | ||
Trading liabilities | 793.6 | 906.6 | 1,192.0 | 924.0 | 426.3 | ||
Commercial paper and other short-term | |||||||
borrowings | 802.0 | 1,217.9 | 1,172.6 | 967.7 | 139.8 | ||
Term borrowings | 3,437.6 | 2,000.1 | 2,537.0 | 2,591.4 | 2,616.4 | ||
Capital markets payables | 591.4 | 1,507.6 | 1,519.1 | 1,283.8 | 390.3 | ||
Other liabilities | 1,173.4 | 1,151.3 | 1,149.6 | 1,141.4 | 1,128.2 | ||
Total liabilities | 33,971.5 | 34,489.1 | 34,687.2 | 32,768.9 | 27,730.2 | ||
Preferred stock of subsidiary | 295.3 | 295.3 | 295.3 | 295.8 | .5 | ||
Shareholders' equity: | |||||||
Common stock | 78.9 | 78.7 | 78.2 | 77.6 | 77.2 | ||
Capital surplus | 267.7 | 259.0 | 228.5 | 196.5 | 173.9 | ||
Undivided profits | 2,016.0 | 1,962.8 | 1,900.8 | 1,851.8 | 1,795.8 | ||
Accumulated other comprehensive loss, net | (42.3) | (33.6) | (13.7) | (36.2) | (9.9) | ||
Deferred compensation on incentive plans | (20.1) | (21.1) | (22.6) | (9.1) | (8.2) | ||
Deferred compensation obligation | 12.1 | 12.1 | 12.1 | 12.1 | 12.2 | ||
Total shareholders' equity | 2,312.3 | 2,257.9 | 2,183.3 | 2,092.7 | 2,041.0 | ||
Total liabilities and shareholders' equity | $36,579.1 | $37,042.3 | $37,165.8 | $35,157.4 | $29,771.7 |
5
AVERAGE AND PERIOD-END LOANS | |||||||
Quarterly, Unaudited | |||||||
(Millions) | 4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | ||
Average loans: | |||||||
Loans, net of unearned income: | |||||||
Commercial: | |||||||
Commercial, financial and industrial | $ 6,357.0 | $ 6,176.2 | $ 5,894.5 | $ 5,480.1 | $ 5,213.6 | ||
Real estate commercial | 1,208.9 | 1,163.2 | 1,086.3 | 1,004.5 | 929.7 | ||
Real estate construction | 1,973.1 | 1,735.9 | 1,546.2 | 1,306.0 | 1,132.1 | ||
Total commercial loans | 9,539.0 | 9,075.3 | 8,527.0 | 7,790.6 | 7,275.4 | ||
Retail: | |||||||
Real estate residential | 8,123.6 | 7,593.7 | 7,533.5 | 7,385.8 | 8,204.5 | ||
Real estate construction | 1,874.8 | 1,643.9 | 1,321.2 | 1,105.4 | 939.8 | ||
Other retail | 170.5 | 167.5 | 161.1 | 160.7 | 172.6 | ||
Credit card receivables | 244.2 | 241.6 | 239.5 | 238.1 | 244.1 | ||
Total retail loans | 10,413.1 | 9,646.7 | 9,255.3 | 8,890.0 | 9,561.0 | ||
Total loans, net of unearned income | $19,952.1 | $18,722.0 | $17,782.3 | $16,680.6 | $16,836.4 | ||
Period-end loans: | |||||||
Loans, net of unearned income: | |||||||
Commercial: | |||||||
Commercial, financial and industrial | $ 6,578.1 | $ 6,354.8 | $ 6,181.6 | $ 5,781.3 | $ 5,560.7 | ||
Real estate commercial | 1,213.1 | 1,171.6 | 1,128.2 | 1,030.1 | 960.2 | ||
Real estate construction | 2,108.1 | 1,849.1 | 1,662.8 | 1,428.0 | 1,208.7 | ||
Total commercial loans | 9,899.3 | 9,375.5 | 8,972.6 | 8,239.4 | 7,729.6 | ||
Retail: | |||||||
Real estate residential | 8,357.1 | 7,603.3 | 7,549.9 | 7,358.9 | 7,244.7 | ||
Real estate construction | 1,925.1 | 1,814.6 | 1,499.5 | 1,190.1 | 1,035.6 | ||
Other retail | 168.4 | 170.7 | 163.8 | 160.5 | 168.8 | ||
Credit card receivables | 251.0 | 248.0 | 242.8 | 234.9 | 249.0 | ||
Total retail loans | 10,701.6 | 9,836.6 | 9,456.0 | 8,944.4 | 8,698.1 | ||
Total loans, net of unearned income | $20,600.9 | $19,212.1 | $18,428.6 | $17,183.8 | $16,427.7 |
6
RETAIL/COMMERCIAL BANKING | ||||||||
Quarterly, Unaudited | ||||||||
(Thousands) | 4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | |||
Net interest income | $227,229 | $224,264 | $210,327 | $197,267 | $193,380 | |||
Noninterest income | 129,117 | 129,503 | 123,104 | 121,379 | 127,466 | |||
Divestitures | 7,029 | - | - | - | 3,200 | |||
Security G/L | - | - | - | - | (1) | |||
Total revenue | 363,375 | 353,767 | 333,431 | 318,646 | 324,045 | |||
Total noninterest expense | 214,006 | 212,403 | 207,800 | 192,868 | 196,836 | |||
Provision | 15,897 | 22,428 | 15,667 | 13,069 | 11,798 | |||
Pretax income | $133,472 | $118,936 | $109,964 | $112,709 | $115,411 | |||
Efficiency ratio | 59% | 60% | 62% | 61% | 61% | |||
Average loans (millions) | $19,799 | $18,613 | $17,700 | $16,622 | $16,792 | |||
Other earning assets (millions) | 1,712 | 2,250 | 1,844 | 1,774 | 1,124 | |||
Total earning assets (millions) | $21,511 | $20,863 | $19,544 | $18,396 | $17,916 | |||
Total deposits | $11,394 | $10,916 | $10,606 | $10,384 | $9,975 | |||
Net interest margin | 4.19% | 4.26% | 4.32% | 4.35% | 4.29% | |||
Noninterest revenue detail | ||||||||
Deposit transactions & cash mgmt | $42,191 | $41,298 | $39,440 | $33,254 | $37,694 | |||
Merchant processing | 22,208 | 22,685 | 23,243 | 20,465 | 19,683 | |||
Insurance commissions | 12,693 | 12,236 | 13,085 | 14,287 | 11,206 | |||
Trust services & investment mgmt | 10,873 | 11,300 | 11,278 | 11,164 | 11,741 | |||
Cardholder fees | 7,274 | 6,836 | 6,529 | 5,922 | 6,252 | |||
Other service charges | 5,078 | 5,367 | 5,219 | 4,806 | 4,900 | |||
Check clearing fees | 1,801 | 1,885 | 1,778 | 1,869 | 2,340 | |||
Revenue from loan sales and | ||||||||
securitizations (a) | 10,630 | 8,638 | 8,386 | 11,114 | 14,151 | |||
Miscellaneous revenue | 16,369 | 19,258 | 14,146 | 18,498 | 19,499 | |||
Total noninterest revenue | $129,117 | $129,503 | $123,104 | $121,379 | $127,466 | |||
Statistics | ||||||||
Trust total assets (millions)(b) | $12,025 | $12,451 | $12,208 | $12,164 | $12,228 | |||
Trust total managed assets (millions)(b) | 6,761 | 6,984 | 7,158 | 7,204 | 7,608 | |||
Merchant transactions | 45,315 | 46,164 | 46,309 | 42,701 | 39,347 | |||
(a) Includes gains from whole-loan sales and net revenue from asset securitizations | ||||||||
(b) Current quarter is an estimate | ||||||||
Certain previously reported amounts have been reclassified to agree with current presentation. |
7
MORTGAGE BANKING | ||||||||
Quarterly, Unaudited | ||||||||
(Thousands) | 4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | |||
Net interest income | $34,497 | $41,688 | $37,601 | $32,957 | $38,858 | |||
Noninterest income: | ||||||||
Net origination fees | 87,545 | 115,541 | 95,676 | 99,964 | 76,567 | |||
Net servicing fees | 20,175 | 17,951 | 6,295 | 13,765 | 15,382 | |||
Other fees | 12,182 | 17,762 | 15,769 | 8,846 | 9,901 | |||
Total noninterest income | 119,902 | 151,254 | 117,740 | 122,575 | 101,850 | |||
Total revenue | 154,399 | 192,942 | 155,341 | 155,532 | 140,708 | |||
Noninterest expense | 113,763 | 131,031 | 112,568 | 108,630 | 105,451 | |||
Provision | 278 | 180 | 119 | 40 | (15) | |||
Pretax income | $40,358 | $61,731 | $42,654 | $46,862 | $35,272 | |||
Noninterest expense detail | ||||||||
Commissions & incentives | $62,946 | $84,774 | $77,400 | $57,718 | $64,845 | |||
FAS 91 cost deferral | 4,813 | 4,616 | (1,332) | (2,574) | (6,315) | |||
Other salaries & benefits | 57,222 | 60,017 | 58,949 | 56,640 | 61,364 | |||
Total salaries & benefits | 124,981 | 149,407 | 135,017 | 111,784 | 119,894 | |||
Contract labor & outsourcing | 4,938 | 5,059 | 5,296 | 4,456 | 4,688 | |||
Equipment & occupancy | 17,633 | 16,554 | 16,786 | 15,600 | 16,837 | |||
Foreclosure provision | 1,264 | 3,063 | (647) | 2,414 | 2,418 | |||
Other expenses | 42,399 | 50,015 | 46,014 | 42,825 | 32,792 | |||
Total expenses before FAS 91 reclass | 191,215 | 224,098 | 202,466 | 177,079 | 176,629 | |||
FAS 91 reclassification | (82,257) | (97,429) | (92,667) | (70,808) | (74,881) | |||
Total noninterest expense before | ||||||||
segment allocations | 108,958 | 126,669 | 109,799 | 106,271 | 101,748 | |||
Segment allocations | 4,805 | 4,362 | 2,769 | 2,359 | 3,703 | |||
Total noninterest expense | $113,763 | $131,031 | $112,568 | $108,630 | $105,451 | |||
Other information | ||||||||
Efficiency ratio | 74% | 68% | 72% | 70% | 75% | |||
Warehouse (millions) | $3,854 | $4,583 | $4,081 | $3,522 | $3,543 | |||
Other earning assets (millions) | 453 | 394 | 391 | 343 | 318 | |||
Total earning assets (millions) | $4,307 | $4,977 | $4,472 | $3,865 | $3,861 | |||
Escrow balances | $2,034 | $2,334 | $2,054 | $1,724 | $1,779 | |||
Net interest margin | 3.18% | 3.32% | 3.37% | 3.46% | 4.00% | |||
Warehouse Spread | 2.06% | 2.33% | 2.66% | 2.89% | 3.58% | |||
Certain previously reported amounts have been reclassified to agree with current presentation. |
8
MORTGAGE BANKING | |||||||
Quarterly, Unaudited | |||||||
(Thousands) | 4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | ||
ORIGINATION INCOME | |||||||
Origination Fees | $79,808 | $104,395 | $97,468 | $76,050 | $79,235 | ||
FAS 91 Fee Deferral | 4,932 | 4,846 | (3,774) | (939) | (3,192) | ||
Appraisal, Final Inspection, | |||||||
Credit Report Fees | 7,574 | 9,639 | 8,967 | 6,926 | 7,142 | ||
Total origination fees | 92,314 | 118,880 | 102,661 | 82,037 | 83,185 | ||
Secondary Marketing Income: | |||||||
OMSR | 86,168 | 108,094 | 80,076 | 72,948 | 62,462 | ||
SRP | 6,849 | 14,940 | 13,629 | 10,426 | 7,709 | ||
Marketing G/L (Trading Gains) | 21,237 | 15,165 | 19,884 | 27,553 | 15,605 | ||
Concessions | (35,808) | (39,810) | (27,319) | (21,944) | (15,360) | ||
LOCOM | (958) | (4,299) | (588) | (248) | (2,153) | ||
Total Secondary Marketing Fees - | |||||||
Mortgage | 77,488 | 94,090 | 85,682 | 88,735 | 68,263 | ||
FAS 91 Reclassification | (82,257) | (97,429) | (92,667) | (70,808) | (74,881) | ||
Total Origination Income | $87,545 | $115,541 | $95,676 | $99,964 | $76,567 | ||
KEY ORIGINATIONS METRICS | |||||||
Production ($ in millions): | |||||||
First Lien Production | $7,991 | $10,557 | $9,526 | $7,618 | $7,840 | ||
Refinanced Production | 3,259 | 4,387 | 3,545 | 3,588 | 3,475 | ||
Refinanced % | 41% | 42% | 37% | 47% | 44% | ||
Purchased Production | 4,732 | 6,170 | 5,981 | 4,030 | 4,365 | ||
Purchased % | 59% | 58% | 63% | 53% | 56% | ||
ARMs % (Excluding Gov't ARMS) | 37% | 41% | 50% | 45% | 47% | ||
Total Sales Force | 2,630 | 2,602 | 2,629 | 2,574 | 2,416 | ||
Warehouse/Pipeline Balance: | |||||||
Ending Warehouse Balance | 2,942 | 3,159 | 3,663 | 3,477 | 3,420 | ||
Ending Pipeline Balance (Locked) | 3,119 | 3,930 | 5,209 | 4,065 | 3,309 | ||
Loan Sales (Deliveries): | |||||||
Total Loan Sales | 7,890 | 10,563 | 8,738 | 7,380 | 7,134 | ||
Margins: | |||||||
Marketing Margin on Deliveries (bps): | |||||||
OMSR | 109 | 102 | 92 | 99 | 88 | ||
Marketing G/L (Trading Gains) | 27 | 14 | 23 | 37 | 22 | ||
LOCOM | (1) | (4) | (1) | - | (3) | ||
Concessions/SRP | (37) | (23) | (16) | (16) | (11) | ||
Total Marketing Margin on Deliveries | 98 | 89 | 98 | 120 | 96 | ||
Certain previously reported amounts have been reclassified to agree with current presentation. |
9
MORTGAGE BANKING | |||||||||||
Quarterly, Unaudited | |||||||||||
4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | |||||||
(Thousands) | $ | bps | $ | bps | $ | bps | $ | bps | $ | bps | |
SERVICING INCOME | |||||||||||
Gross Service Fees | $91,735 | 39 | $88,866 | 38 | $87,285 | 39 | $85,908 | 39 | $80,462 | 38 | |
Guarantee Fees | (18,980) | (8) | (18,900) | (8) | (19,039) | (9) | (19,127) | (9) | (18,020) | (9) | |
Sub-Service Fee Income | 144 | - | 101 | - | 40 | - | 4 | - | 2 | - | |
Lender Paid MI | (168) | - | (145) | - | (159) | - | (121) | - | (143) | - | |
Net Service Fees | 72,731 | 31 | 69,922 | 30 | 68,127 | 30 | 66,664 | 30 | 62,301 | 29 | |
Early Payoff Interest Expense | (5,164) | (2) | (6,844) | (3) | (5,742) | (2) | (5,193) | (2) | (5,485) | ��(2) | |
Ancillary Fees | 6,698 | 3 | 6,601 | 3 | 6,001 | 3 | 6,411 | 3 | 5,864 | 3 | |
Total Service Fees | 74,265 | 32 | 69,679 | 30 | 68,386 | 31 | 67,882 | 31 | 62,680 | 30 | |
AMORTIZATION/IMPAIRMENT | |||||||||||
Amortization | (48,296) | (47,873) | (45,808) | (46,915) | (41,639) | ||||||
Impairment | (1,374) | 48 | (23,545) | (10,375) | (9,489) | ||||||
Total Amortization/Impairment | (49,670) | (47,825) | (69,353) | (57,290) | (51,128) | ||||||
HEDGE GAINS | |||||||||||
MSR Hedge Gains/(Losses) | |||||||||||
NII on SWAPs | 5,240 | 8,703 | 13,607 | 18,330 | 16,382 | ||||||
Hedge Ratios | 3,014 | 11,259 | 16,092 | 11,013 | 15,481 | ||||||
Other Ineffectiveness | (7,242) | (13,793) | (10,391) | (11,843) | (13,342) | ||||||
Total MSR Hedge Gains/(Losses) | 1,012 | 6,169 | 19,308 | 17,500 | 18,521 | ||||||
Time Decay of MSR Hedges | (2,667) | (9,831) | (9,513) | (9,984) | (12,129) | ||||||
Hedge MTM & Time Decay: | |||||||||||
I/O Strip Time Decay | (763) | (367) | (2,092) | (3,257) | (1,874) | ||||||
I/O Strip MTM | (2,002) | 126 | (441) | (1,086) | (688) | ||||||
Total Hedge MTM & Time Decay | (2,765) | (241) | (2,533) | (4,343) | (2,562) | ||||||
Total Hedge Gains | (4,420) | (3,903) | 7,262 | 3,173 | 3,830 | ||||||
Total Servicing Income | 20,175 | 17,951 | 6,295 | 13,765 | 15,382 | ||||||
KEY SERVICING METRICS | |||||||||||
($ in millions) | |||||||||||
Avg. Servicing Portfolio (Owned) | $94,388 | $92,235 | $89,366 | $87,397 | $84,863 | ||||||
End. Servicing Portfolio (Owned) | $95,284 | $93,589 | $90,823 | $88,010 | $86,587 | ||||||
Average Loans Serviced (#) | 616,649 | 610,895 | 599,361 | 598,997 | 583,248 | ||||||
Product Mix (Average) | |||||||||||
Product Mix (%) | |||||||||||
GNMA | 9% | 9% | 10% | 11% | 12% | ||||||
FNMA/FHLMC | 65% | 67% | 68% | 69% | 69% | ||||||
Private | 22% | 20% | 18% | 16% | 15% | ||||||
Sub-Total | 96% | 96% | 96% | 96% | 96% | ||||||
Warehouse | 4% | 4% | 4% | 4% | 4% | ||||||
Total | 100% | 100% | 100% | 100% | 100% | ||||||
Other Statistics | |||||||||||
(Annualized) | |||||||||||
Ancillary Income per Loan | $43.45 | $43.22 | $40.05 | $42.81 | $40.22 | ||||||
Servicing Cost per Loan | $51.74 | $51.80 | $52.08 | $54.12 | $56.88 | ||||||
Portfolio Data | |||||||||||
(in millions) | |||||||||||
Average Servicing Asset ** | 1,262 | 1,106 | 1,062 | 1,049 | 971 | ||||||
Valuation Reserve (Ending Balance) | 1 | 1 | 6 | 3 | 4 | ||||||
Servicing Book Value (bps) | 134 | 120 | 119 | 120 | 114 | ||||||
Amortization/Average Servicing Asset | 15% | 17% | 17% | 18% | 17% | ||||||
Impairment/Average Servicing Asset | 0% | 0% | 9% | 4% | 4% | ||||||
Run-Off Rate | 22% | 28% | 25% | 22% | 26% | ||||||
** Includes valuation reserve/MSRs only | |||||||||||
Certain previously reported amounts have been reclassified to agree with current presentation. |
10
CAPITAL MARKETS | ||||||||
Quarterly, Unaudited | ||||||||
(Thousands) | 4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | |||
NII | $ (986) | $ (2,595) | $ (4,904) | $ (556) | $ 376 | |||
Incremental cost of equity | (4,919) | (5,231) | (4,586) | (4,623) | - | |||
Net interest income | (5,905) | (7,826) | (9,490) | (5,179) | 376 | |||
Noninterest income: | ||||||||
Fixed income | 44,397 | 43,870 | 50,819 | 63,020 | 45,919 | |||
Other | 40,421 | 42,371 | 49,399 | 33,407 | 34,164 | |||
Total noninterest income | 84,818 | 86,241 | 100,218 | 96,427 | 80,083 | |||
Total revenue | 78,913 | 78,415 | 90,728 | 91,248 | 80,459 | |||
Noninterest expense | 75,419 | 75,910 | 82,679 | 81,538 | 69,527 | |||
Pretax income | $3,494 | $2,505 | $8,049 | $9,710 | $10,932 | |||
Efficiency ratio | 96% | 97% | 91% | 89% | 86% | |||
Trading inventory (millions) | $2,160 | $2,158 | $2,069 | $2,235 | $857 | |||
Other earning assets (millions) | 2,285 | 2,512 | 2,493 | 1,964 | 715 | |||
Total earning assets (millions) | $4,445 | $4,670 | $4,562 | $4,199 | $1,572 | |||
Net interest margin | (0.53)% | (0.66)% | (0.83)% | (0.50)% | 0.10% | |||
Certain previously reported amounts have been reclassified to agree with current presentation. |
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CORPORATE | ||||||||
Quarterly, Unaudited | ||||||||
(Thousands) | 4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | |||
Net interest income | $ (1,010) | $ 2,035 | $ 3,170 | $ 2,402 | $ (4,168) | |||
Noninterest income | 2,749 | 2,945 | 2,250 | 3,083 | 4,283 | |||
Security G/L | (181) | (406) | 75 | (66) | (3,733) | |||
Total revenue | 1,558 | 4,574 | 5,495 | 5,419 | (3,618) | |||
Total noninterest expense | 17,639 | 16,875 | 15,984 | 11,819 | 10,874 | |||
Pretax income | $ (16,081) | $ (12,301) | $ (10,489) | $ (6,400) | $ (14,492) | |||
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CAPITAL HIGHLIGHTS | ||||||
(Dollars in millions except per share amounts, Unaudited) | ||||||
4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | ||
Tier 1 Capital (a) | $ 2,489.3 | $ 2,430.8 | $ 2,364.8 | $ 2,292.3 | $ 2,080.2 | |
Tier 2 Capital (a) | 1,090.5 | 1,112.5 | 1,096.7 | 1,108.8 | 1,102.5 | |
Total Capital (a) | $ 3,579.8 | $ 3,543.3 | $ 3,461.5 | $ 3,401.1 | $ 3,182.7 | |
Risk-Adjusted Assets (a) | $29,329.6 | $28,225.1 | $27,464.8�� | $25,736.7 | $24,140.7 | |
Tier 1 Ratio (a) | 8.49% | 8.61% | 8.61% | 8.91% | 8.62% | |
Tier 2 Ratio (a) | 3.72 | 3.94 | 3.99 | 4.30 | 4.56 | |
Total Capital Ratio (a) | 12.21% | 12.55% | 12.60% | 13.21% | 13.18% | |
Leverage Ratio (a) | 6.67% | 6.45% | 6.59% | 6.80% | 7.16% | |
Shareholders' Equity/Assets Ratio (b) | 6.32 | 6.10 | 5.87 | 5.95 | 6.86 | |
Book Value | $ 18.18 | $ 17.78 | $ 17.32 | $ 16.73 | $ 16.39 | |
(a) Current quarter is an estimate | ||||||
(b) Calculated on period-end balances |
13
NET INTEREST MARGIN (NIM) HIGHLIGHTS | ||||||
(Unaudited) | ||||||
4Q05 | 3Q05 | 2Q05 | 1Q05 | 4Q04 | ||
Consolidated Yields and Rates: | ||||||
Investment securities | 4.47 % | 4.30 % | 4.33 % | 4.27 % | 4.21 % | |
Loans, net of unearned | 6.72 | 6.34 | 5.98 | 5.63 | 5.33 | |
Loans held for sale | 6.48 | 6.43 | 6.20 | 5.95 | 5.79 | |
Capital markets securities inventory | 5.02 | 5.01 | 4.39 | 4.39 | 3.64 | |
Mortgage banking trading securities | 11.25 | 12.82 | 12.63 | 12.68 | 12.60 | |
Other earning assets | 3.61 | 3.07 | 2.61 | 2.15 | 1.54 | |
Yields on earning assets | 6.23 | 5.90 | 5.56 | 5.29 | 5.22 | |
Interest-bearing core deposits | 2.30 | 2.13 | 1.92 | 1.73 | 1.56 | |
CD's over $100,000 | 4.06 | 3.53 | 3.06 | 2.59 | 2.09 | |
Fed funds purchased and repos | 3.65 | 3.18 | 2.71 | 2.24 | 1.78 | |
Commercial paper and other short-term | ||||||
borrowings | 4.40 | 3.62 | 3.18 | 2.68 | 2.15 | |
Capital markets trading liabilities | 5.74 | 5.54 | 5.20 | 4.64 | 3.65 | |
Term borrowings | 4.77 | 4.16 | 3.71 | 3.18 | 2.70 | |
Rates paid on interest-bearing liabilities | 3.71 | 3.31 | 2.90 | 2.49 | 1.99 | |
Net interest spread | 2.52 | 2.59 | 2.66 | 2.80 | 3.23 | |
Effect of interest-free sources | .54 | .50 | .40 | .32 | .34 | |
FHN - NIM | 3.06 % | 3.09 % | 3.06 % | 3.12 % | 3.57 % | |
Certain previously reported amounts have been reclassified to agree with current presentation. |
14