Investment Securities (Tables)

9 Months Ended

Sep. 30, 2017

The following tables summarize FHN’s investment securities on September 30, 2017 and December 31, 2016:



	September 30, 2017
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Securities available-for-sale:
U.S. treasuries	$	100	$	—	$	—		$	100
Government agency issued mortgage-backed securities (“MBS”)	2,081,677		15,993		(10,165		)	2,087,505
Government agency issued collateralized mortgage obligations (“CMO”)	1,701,467		4,295		(19,767		)	1,685,995
Equity and other (a)	186,413		2		—			186,415
	$	3,969,657	$	20,290	$	(29,932	)	3,960,015
AFS debt securities recorded at fair value through earnings:
SBA-interest only strips (b)								3,123
Total securities available-for-sale (c)								$	3,963,138
Securities held-to-maturity:
Corporate bonds	$	10,000	$	—	$	(15	)	$	9,985
Total securities held-to-maturity	$	10,000	$	—	$	(15	)	$	9,985


(a)	Includes restricted investments in FHLB-Cincinnati stock of $87.9 million and FRB stock of $68.6 million. The remainder is money market, mutual funds, and cost method investments.


(b)	SBA-interest only strips are recorded at elected fair value. See Note 16 - Fair Value for additional information.


(c)	Includes $3.3 billion of securities pledged to secure public deposits, securities sold under agreements to repurchase, and for other purposes.



	December 31, 2016
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Securities available-for-sale:
U.S. treasuries	$	100	$	—	$	—		$	100
Government agency issued MBS	2,217,593		14,960		(23,866		)	2,208,687
Government agency issued CMO	1,566,986		4,909		(23,937		)	1,547,958
Equity and other (a)	186,756		—		(2		)	186,754
Total securities available-for-sale (b)	$	3,971,435	$	19,869	$	(47,805	)	$	3,943,499
Securities held-to-maturity:
States and municipalities	$	4,347	$	393	$	—		$	4,740
Corporate bonds	10,000		33		—			10,033
Total securities held-to-maturity	$	14,347	$	426	$	—		$	14,773


(a)	Includes restricted investments in FHLB-Cincinnati stock of $87.9 million and FRB stock of $68.6 million. The remainder is money market, mutual funds, and cost method investments.


(b)	Includes $3.3 billion of securities pledged to secure public deposits, securities sold under agreements to repurchase, and for other purposes.

Schedule Of Amortized Cost And Fair Value By Contractual Maturity

The amortized cost and fair value by contractual maturity for the available-for-sale and held-to-maturity securities portfolios on September 30, 2017 are provided below:



	Held-to-Maturity				Available-for-Sale
(Dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Within 1 year	$	—	$	—	$	—	$	—
After 1 year; within 5 years	—		—		100		120
After 5 years; within 10 years	10,000		9,985		—		1,464
After 10 years	—		—		—		1,639
Subtotal	10,000		9,985		100		3,223
Government agency issued MBS and CMO (a)	—		—		3,783,144		3,773,500
Equity and other	—		—		186,413		186,415
Total	$	10,000	$	9,985	$	3,969,657	$	3,963,138


(a)	Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Schedule Of Gross Gains And Losses On Sale From Available For Sale Portfolio

The table below provides information on gross gains and gross losses from investment securities for the three and nine months ended September 30:



	Three Months Ended September 30					Nine Months Ended September 30
(Dollars in thousands)	2017		2016			2017		2016
Gross gains on sales of securities	$	6	$	—		$	455	$	3,999
Gross (losses) on sales of securities	—		—			—		(2,326		)
Net gain/(loss) on sales of securities (a) (b)	6		—			455		1,673
Net OTTI recorded (c)	—		(200		)	—		(200		)
Total securities gain/(loss)	$	6	$	(200	)	$	455	$	1,473

(a)

Cash proceeds from the sale of available-for-sale securities for the three and nine months ended September 30, 2017 were not material. There were no cash proceeds from the sale of available-for-sale securities for the three months ended September 30, 2016. Cash proceeds from the sale of available-for-sale securities for the nine months ended September 30, 2016 were $1.5 million and included a $1.7 million gain from an exchange of approximately $294 million of AFS debt securities.


(b)	Nine months ended September 30, 2017 includes a $.4 million gain associated with the call of a $4.4 million held-to-maturity municipal bond.


(c)	OTTI recorded is related to equity securities.

Schedule Of Investments Within The Available For Sale Portfolio That Had Unrealized Losses

The following tables provide information on investments within the available-for-sale portfolio that had unrealized losses as of September 30, 2017 and December 31, 2016:



	As of September 30, 2017
	Less than 12 months					12 months or longer					Total
(Dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Government agency issued CMO	$	885,926	$	(10,936	)	$	311,471	$	(8,831	)	$	1,197,397	$	(19,767	)
Government agency issued MBS	875,307		(8,770		)	34,184		(1,395		)	909,491		(10,165		)
Total temporarily impaired securities	1,761,233		(19,706		)	345,655		(10,226		)	2,106,888		(29,932		)



	As of December 31, 2016
	Less than 12 months					12 months or longer					Total
(Dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Government agency issued CMO	$	1,059,471	$	(19,052	)	$	116,527	$	(4,885	)	$	1,175,998	$	(23,937	)
Government agency issued MBS	1,912,126		(23,866		)	—		—			1,912,126		(23,866		)
Total debt securities	2,971,597		(42,918		)	116,527		(4,885		)	3,088,124		(47,803		)
Equity	7		(2		)	—		—			7		(2		)
Total temporarily impaired securities	$	2,971,604	$	(42,920	)	$	116,527	$	(4,885	)	$	3,088,131	$	(47,805	)