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Loans and Leases
 3 Months Ended
Mar. 31, 2024
Receivables [Abstract]  
Loans and Leases Loans and Leases
The loans and leases portfolio is disaggregated into portfolio segments and then further disaggregated into classes for certain disclosures. GAAP defines a portfolio segment as the level at which an entity develops and documents a systematic method for determining its allowance for credit losses. A class is generally a disaggregation of a portfolio segment and is generally determined based on risk characteristics of the loan and FHN’s method for monitoring and assessing credit risk and performance. FHN's loan and lease portfolio segments are commercial and consumer. The classes of loans and leases are: (1) commercial, financial, and industrial, which
includes commercial and industrial loans and leases and loans to mortgage companies, (2) commercial real estate, (3) consumer real estate, which includes both real estate installment and home equity lines of credit, and (4) credit card and other.
The following table provides the amortized cost basis of loans and leases by portfolio segment and class as of March 31, 2024 and December 31, 2023, excluding accrued interest of $283 million and $287 million, respectively, which is included in other assets in the Consolidated Balance Sheets.
LOANS AND LEASES BY PORTFOLIO SEGMENT
(Dollars in millions)March 31, 2024December 31, 2023
Commercial:
Commercial and industrial (a) (b)$30,545 $30,609 
Loans to mortgage companies2,366 2,024 
   Total commercial, financial, and industrial 32,911 32,633 
Commercial real estate14,426 14,216 
Consumer:
HELOC2,145 2,219 
Real estate installment loans11,500 11,431 
   Total consumer real estate13,645 13,650 
Credit card and other (c)771 793 
Loans and leases$61,753 $61,292 
Allowance for loan and lease losses(787)(773)
Net loans and leases$60,966 $60,519 
(a)Includes equipment financing leases of $1.3 billion and $1.2 billion for March 31, 2024 and December 31, 2023, respectively.
(b)Includes PPP loans fully guaranteed by the SBA of $23 million and $29 million as of March 31, 2024 and December 31, 2023, respectively.
(c)Includes $181 million and $180 million of commercial credit card balances as of March 31, 2024 and December 31, 2023, respectively.

Restrictions
Loans and leases with carrying values of $50.1 billion and $46.1 billion were pledged as collateral for borrowings at March 31, 2024 and December 31, 2023, respectively.
Concentrations of Credit Risk
Most of FHN’s business activity is with clients located in the southern United States. FHN’s lending activity is concentrated in its market areas within those states. As of March 31, 2024, FHN had loans to mortgage companies of $2.4 billion and loans to finance and insurance companies of $3.8 billion. As a result, 19% of the C&I portfolio is sensitive to impacts on the financial services industry.
Credit Quality Indicators
FHN employs a dual grade commercial risk grading methodology to assign an estimate for the probability of default and the loss given default for each commercial loan using factors specific to various industry, portfolio, or
product segments that result in a rank ordering of risk and the assignment of grades PD 1 to PD 16. This credit grading system is intended to identify and measure the credit quality of the loan and lease portfolio by analyzing the migration between grading categories. It is also integral to the estimation methodology utilized in determining the ALLL since an allowance is established for pools of commercial loans based on the credit grade assigned. Each PD grade corresponds to an estimated one-year default probability percentage. PD grades are continually evaluated but require a formal scorecard annually.
PD 1 through PD 12 are “pass” grades. PD grades 13-16 correspond to the regulatory-defined categories of special mention (13), substandard (14), doubtful (15), and loss (16). Special mention loans and leases have potential weaknesses that, if left uncorrected, may result in deterioration of FHN's credit position at some future date. Substandard commercial loans and leases have well-
defined weaknesses and are characterized by the distinct possibility that FHN will sustain some loss if the deficiencies are not corrected. Doubtful commercial loans and leases have the same weaknesses as substandard loans and leases with the added characteristics that the probability of loss is high, and collection of the full amount is improbable.
The following tables provide the amortized cost basis of the commercial loan portfolio by year of origination and credit quality indicator as of March 31, 2024 and December 31, 2023:
C&I PORTFOLIO
March 31, 2024
(Dollars in millions)20242023202220212020Prior to 2020LMC (a)Revolving
 Loans		Revolving
Loans Converted
to Term Loans		Total
Credit Quality Indicator:
Pass (PD grades 1 through 12) (b)$703 $3,885 $5,346 $3,328 $1,537 $4,874 $2,362 $8,999 $309 $31,343 
Special Mention (PD grade 13)1 127 73 87 69 167 — 332 2 858 
Substandard, Doubtful, or Loss (PD grades 14,15, and 16)2 44 136 93 48 183 4 163 37 710 
Total C&I loans$706 $4,056 $5,555 $3,508 $1,654 $5,224 $2,366 $9,494 $348 $32,911 
December 31, 2023
(Dollars in millions)20232022202120202019Prior to 2019LMC (a)Revolving
 Loans		Revolving
Loans Converted
to Term Loans		Total
Credit Quality Indicator:
Pass (PD grades 1 through 12) (b)$4,008 $5,637 $3,506 $1,636 $1,665 $3,448 $2,019 $9,087 $327 $31,333 
Special Mention (PD grade 13)75 60 64 56 101 57 — 186 — 599 
Substandard, Doubtful, or Loss (PD grades 14,15, and 16)41 135 94 51 39 100 5 187 49 701 
Total C&I loans$4,124 $5,832 $3,664 $1,743 $1,805 $3,605 $2,024 $9,460 $376 $32,633 
(a)    LMC includes non-revolving commercial lines of credit to qualified mortgage companies primarily for the temporary warehousing of eligible mortgage loans prior to the borrower's sale of those mortgage loans to third-party investors. The loans are of short duration with maturities less than one year.
(b)    Balances include PPP loans.

CRE PORTFOLIO
March 31, 2024
(Dollars in millions)20242023202220212020Prior to 2020Revolving
 Loans		Revolving Loans Converted to Term LoansTotal
Credit Quality Indicator:
Pass (PD grades 1 through 12) $104 $955 $3,611 $3,513 $1,107 $3,869 $337 $15 $13,511 
Special Mention (PD grade 13)— 1 76 182 86 239 4 — 588 
Substandard, Doubtful, or Loss (PD grades 14,15, and 16)— 2 6 10 50 256 3 — 327 
Total CRE loans$104 $958 $3,693 $3,705 $1,243 $4,364 $344 $15 $14,426 
December 31, 2023
(Dollars in millions)20232022202120202019Prior to 2019Revolving
 Loans		Revolving Loans Converted to Term LoansTotal
Credit Quality Indicator:
Pass (PD grades 1 through 12)$853 $3,473 $3,518 $1,162 $1,216 $2,853 $393 $18 $13,486 
Special Mention (PD grade 13)5 1 129 86 175 82 — — 478 
Substandard, Doubtful, or Loss (PD grades 14,15, and 16)— 2 5 11 175 59 — — 252 
Total CRE loans$858 $3,476 $3,652 $1,259 $1,566 $2,994 $393 $18 $14,216 

The consumer portfolio is comprised primarily of smaller-balance loans which are very similar in nature in that most are standard products and are backed by residential real estate. Because of the similarities of consumer loan types, FHN is able to utilize the FICO score, among other attributes, to assess the credit quality of consumer borrowers. FICO scores are refreshed on a quarterly basis in an attempt to reflect the recent risk profile of the borrowers. Accruing delinquency amounts are indicators of asset quality within the credit card and other consumer portfolio.
The following table reflects the amortized cost basis by year of origination and refreshed FICO scores for
consumer real estate loans as of March 31, 2024 and December 31, 2023. Within consumer real estate, classes include HELOC and real estate installment loans. HELOCs are loans which during their draw period are classified as revolving loans. Once the draw period ends and the loan enters its repayment period, the loan converts to a term loan and is classified as a revolving loan converted to a term loan. All loans classified in the following tables as revolving loans or revolving loans converted to term loans are HELOCs. Real estate installment loans are originated as fixed term loans and are classified below in their vintage year. All loans in the following tables classified in a vintage year are real estate installment loans.
CONSUMER REAL ESTATE PORTFOLIO
March 31, 2024
(Dollars in millions)20242023202220212020Prior to 2020Revolving
 Loans		Revolving
Loans Converted
to Term Loans		Total
FICO score 740 or greater$204 $1,562 $2,080 $1,695 $717 $1,733 $1,466 $47 $9,504 
FICO score 720-73916 203 282 225 106 308 190 14 1,344 
FICO score 700-71915 152 230 189 79 270 159 16 1,110 
FICO score 660-69926 170 193 111 81 332 162 17 1,092 
FICO score 620-6593 11 18 23 22 138 34 6 255 
FICO score less than 620 3 18 19 18 18 230 23 11 340 
Total$267 $2,116 $2,822 $2,261 $1,023 $3,011 $2,034 $111 $13,645 
December 31, 2023
(Dollars in millions)20232022202120202019Prior to 2019Revolving
 Loans		Revolving Loans Converted to Term Loans Total
FICO score 740 or greater$1,572 $2,099 $1,720 $730 $465 $1,332 $1,522 $50 $9,490 
FICO score 720-739205 286 227 107 88 230 192 15 1,350 
FICO score 700-719154 232 193 81 52 224 159 17 1,112 
FICO score 660-699170 198 113 83 53 290 168 18 1,093 
FICO score 620-65911 20 23 22 36 106 36 7 261 
FICO score less than 620 18 19 15 20 12 225 24 11 344 
Total$2,130 $2,854 $2,291 $1,043 $706 $2,407 $2,101 $118 $13,650 

The following tables reflect the amortized cost basis by year of origination and refreshed FICO scores for credit card and other loans as of March 31, 2024 and December 31, 2023.

CREDIT CARD & OTHER PORTFOLIO
March 31, 2024
(Dollars in millions)20242023202220212020Prior to 2020Revolving
 Loans		Revolving
Loans Converted
to Term Loans 		Total
FICO score 740 or greater$7 $50 $22 $9 $5 $29 $193 $5 $320 
FICO score 720-7391 5 3 1 1 6 22 1 40 
FICO score 700-719— 4 4 1 1 4 25 — 39 
FICO score 660-699— 4 2 1 1 8 21 — 37 
FICO score 620-6591 1 — 1 — 3 7 — 13 
FICO score less than 620 2 13 9 6 7 116 168 1 322 
Total$11 $77 $40 $19 $15 $166 $436 $7 $771 
December 31, 2023
(Dollars in millions)20232022202120202019Prior to 2019Revolving
 Loans		Revolving Loans Converted to Term Loans Total
FICO score 740 or greater$52 $26 $10 $5 $3 $27 $207 $5 $335 
FICO score 720-7395 3 1 1 1 5 24 1 41 
FICO score 700-7195 4 1 1 1 4 25 1 42 
FICO score 660-6994 3 1 1 1 8 23 — 41 
FICO score 620-6592 1 1 — — 3 7 — 14 
FICO score less than 620 12 9 6 8 13 103 168 1 320 
Total$80 $46 $20 $16 $19 $150 $454 $8 $793 


Nonaccrual and Past Due Loans and Leases
Loans and leases are placed on nonaccrual if it becomes evident that full collection of principal and interest is at risk, impairment has been recognized as a partial charge-off of principal balance due to insufficient collateral value and past due status, or on a case-by-case basis if FHN continues to receive payments but there are other borrower-specific issues. Included in nonaccrual are loans
for which FHN continues to receive payments including residential real estate loans where the borrower has been discharged of personal obligation through bankruptcy.
Past due loans are loans contractually past due as to interest or principal payments, but which have not yet been put on nonaccrual status.

The following table reflects accruing and non-accruing loans and leases by class on March 31, 2024 and December 31, 2023:
ACCRUING & NON-ACCRUING LOANS AND LEASES
March 31, 2024
 AccruingNon-Accruing 
(Dollars in millions)Current30-89
Days
Past Due		90+
Days
Past Due		Total
Accruing		Current30-89
Days
Past Due		90+
Days
Past Due		Total
Non-
Accruing		Total
Loans and Leases
Commercial, financial, and industrial:
C&I (a) $30,287 $55 $1 $30,343 $102 $30 $70 $202 $30,545 
Loans to mortgage companies2,362 — — 2,362 4 — — 4 2,366 
Total commercial, financial, and industrial32,649 55 1 32,705 106 30 70 206 32,911 
Commercial real estate:
CRE (b)14,261 8 — 14,269 57 28 72 157 14,426 
Consumer real estate:
HELOC (c)2,089 12 3 2,104 27 4 10 41 2,145 
Real estate installment loans (d)11,359 39 3 11,401 41 13 45 99 11,500 
Total consumer real estate13,448 51 6 13,505 68 17 55 140 13,645 
Credit card and other:
Credit card267 2 3 272 — — — — 272 
Other494 3 — 497 1 — 1 2 499 
Total credit card and other761 5 3 769 1 — 1 2 771 
Total loans and leases$61,119 $119 $10 $61,248 $232 $75 $198 $505 $61,753 
December 31, 2023
 AccruingNon-Accruing 
(Dollars in millions)Current30-89
Days
Past Due		90+
Days
Past Due		Total
Accruing		Current30-89
Days
Past Due		90+
Days
Past Due		Total
Non-
Accruing		Total
Loans and Leases
Commercial, financial, and industrial:
C&I (a) $30,398 $31 $1 $30,430 $108 $18 $53 $179 $30,609 
Loans to mortgage companies2,018 1 — 2,019 5 — — 5 2,024 
Total commercial, financial, and industrial32,416 32 1 32,449 113 18 53 184 32,633 
Commercial real estate:
CRE (b)14,072 8 — 14,080 41 — 95 136 14,216 
Consumer real estate:
HELOC (c)2,158 11 4 2,173 30 6 10 46 2,219 
Real estate installment loans (d)11,295 29 13 11,337 43 6 45 94 11,431 
Total consumer real estate13,453 40 17 13,510 73 12 55 140 13,650 
Credit card and other:
Credit card271 3 3 277 — — — — 277 
Other512 2 — 514 1 — 1 2 516 
Total credit card and other783 5 3 791 1 — 1 2 793 
Total loans and leases$60,724 $85 $21 $60,830 $228 $30 $204 $462 $61,292 
(a)    $191 million and $178 million of C&I loans are nonaccrual loans that have been specifically reviewed for impairment with no related allowance in 2024 and 2023, respectively.
(b)    $150 million and $129 million of CRE loans are nonaccrual loans that have been specifically reviewed for impairment with no related allowance in 2024 and 2023, respectively.
(c)    $4 million of HELOC loans are nonaccrual loans that have been specifically reviewed for impairment with no related allowance in both 2024 and 2023, respectively.
(d)    $9 million and $10 million of real estate installment loans are nonaccrual loans that have been specifically reviewed for impairment with no related allowance in 2024 and 2023, respectively.

Collateral-Dependent Loans
Collateral-dependent loans are defined as loans for which repayment is expected to be derived substantially through the operation or sale of the collateral and where the borrower is experiencing financial difficulty. At a minimum, the estimated value of the collateral for each loan equals the current book value.
As of March 31, 2024 and December 31, 2023, FHN had commercial loans with amortized cost of approximately $264 million and $250 million, respectively, that were based on the value of underlying collateral. Collateral-dependent C&I and CRE loans totaled $145 million and $119 million, respectively, at March 31, 2024. The collateral for these loans generally consists of business assets including land, buildings, equipment, and financial assets. During the three months ended March 31, 2024, FHN recognized charge-offs of $22 million on these loans related to reductions in estimated collateral values.
Consumer HELOC and real estate installment loans with amortized cost based on the value of underlying real estate collateral were approximately $6 million and $26 million, respectively, as of March 31, 2024 and $6 million and $27 million, respectively, as of December 31, 2023. Charge-offs relating to collateral-dependent consumer loans for the three months ended March 31, 2024 and March 31, 2023 were not significant.
Loan Modifications to Troubled Borrowers
As part of FHN’s ongoing risk management practices, FHN attempts to work with borrowers when necessary to extend or modify loan terms to better align with their current ability to repay. Modifications could include extension of the maturity date, reductions of the interest rate, reduction or forgiveness of accrued interest, or principal forgiveness. Combinations of these modifications may also be made for individual loans. Extensions and modifications to loans are made in accordance with internal policies and guidelines which conform to regulatory guidance. Principal reductions may be made in limited circumstances, typically for specific commercial loan workouts, and in the event of borrower bankruptcy. Each occurrence is unique to the borrower and is evaluated separately.
Troubled loans are considered those in which the borrower is experiencing financial difficulty. The assessment of whether a borrower is experiencing financial difficulty can be subjective in nature and management’s judgment may be required in making this determination. FHN may determine that a borrower is experiencing financial difficulty if the borrower is currently in default on any of its debt, or if it is probable that a borrower may default in the foreseeable future absent a modification. Many aspects of a borrower’s financial situation are assessed when determining whether they are experiencing financial difficulty.
Troubled commercial loans are typically modified through forbearance agreements which could include reduced interest rates, reduced payments, term extension, or entering into short sale agreements. Principal reductions may occur in specific circumstances.
Modifications for troubled consumer loans are generally structured using parameters of U.S. government-sponsored programs. For HELOC and real estate installment loans, troubled loans are typically modified by an interest rate reduction and a possible maturity date extension to reach an affordable housing debt-to-income ratio. Despite the absence of a loan modification by FHN, the discharge of personal liability through bankruptcy proceedings is considered a court-imposed modification.
For the credit card portfolio, troubled loan modifications are typically enacted through either a short-term credit
card hardship program or a longer-term credit card workout program. In the credit card hardship program, borrowers may be granted rate and payment reductions for six months to one year. In the credit card workout program, borrowers are granted a rate reduction to 0% and a term extension for up to five years.
Modifications to Borrowers Experiencing Financial Difficulty
The following tables present the amortized cost basis at the end of the reporting period of loans modified to borrowers experiencing financial difficulty, disaggregated by class of financing receivable and type of modification made, as well as the financial effect of the modifications made as of March 31, 2024:

LOAN MODIFICATIONS TO BORROWERS EXPERIENCING FINANCIAL DIFFICULTY
Interest Rate Reduction
Three Months Ended March 31, 2024Three Months Ended March 31, 2023
(Dollars in millions)Balance% of Total Class Financial EffectBalance% of Total ClassFinancial Effect
Consumer real estate (a)$— — %
Reduced weighted-average contractual interest rate from 9.95% to 6.75%
$— — %N/A
Credit card and other (a)— — 
Reduced weighted-average contractual interest rate from 20.50% to 0.00%
— — N/A
Total$— — %$— — %
(a) Balance less than $1 million.

Term Extension
Three Months Ended March 31, 2024Three Months Ended March 31, 2023
(Dollars in millions)Balance% of Total ClassFinancial EffectBalance% of Total ClassFinancial Effect
C&I$64 0.2 %
Added an estimated weighted-average 1.4 years to the life of loans, which reduced monthly payment amounts for the borrowers
$63 0.2 %
Added a weighted-average 1 year to the life of loans, which reduced monthly payment amounts for the borrowers
CRE19 0.1 
Added an estimated weighted-average 0.8 years to the life of loans, which reduced monthly payment amounts for the borrowers
32 0.2 
Added a weighted-average 0.6 years to the life of loans, which reduced monthly payment amounts for the borrowers
Consumer real estate— — N/A1 — 
Added a weighted-average 14.9 years to the life of loans, which reduced monthly payment amounts for the borrowers
Total$83 0.1 %$96 0.2 %
Principal Forgiveness
Three Months Ended March 31, 2024Three Months Ended March 31, 2023
(Dollars in millions)Balance% of Total Class Financial EffectBalance% of Total ClassFinancial Effect
Consumer real estate (a)$— — %
Less than $1 million of the principal of consumer loans was legally discharged in bankruptcy during the period and the borrowers have not re-affirmed the debt as of period end
$— — %N/A
Total$— — %$— — %
(a) Balance less than $1 million

Payment Deferrals
Three Months Ended March 31, 2024Three Months Ended March 31, 2023
(Dollars in millions)Balance% of Total ClassFinancial EffectBalance% of Total ClassFinancial Effect
Consumer real estate$— — %N/A$4 — %
Payment deferral for 11 months, with a balloon payment at the end of the term
Total$— — %$4 — %

Combination - Term Extension and Interest Rate Reduction
Three Months Ended March 31, 2024Three Months Ended March 31, 2023
(Dollars in millions)Balance% of Total Class Financial EffectBalance% of Total ClassFinancial Effect
Consumer real estate$1 — %
Added an estimated weighted-average 18.8 years to the life of loans and reduced weighted-average contractual interest rate from 6.43% to 3.69%
$2 — %
Added a weighted-average 8.8 years to the life of loans and reduced weighted-average contractual interest rate from 5.00% to 4.90%
Total$1 — %$2 — %


Combination - Principal Forgiveness and Term Extension
Three Months Ended March 31, 2024Three Months Ended March 31, 2023
(Dollars in millions)Balance% of Total Class Financial EffectBalance% of Total ClassFinancial Effect
C&I$— — %N/A$18 0.1 %
Reduced the balance of the loans by $2 million and added a weighted-average 6.2 years to the life of the loans
Total$— — %$18 — %

Loan modifications to borrowers experiencing financial difficulty that had a payment default during the period and were modified in the 12 months before default totaled $1 million for the three months ended March 31, 2024 and were insignificant for the three months ended March 31, 2023. FHN closely monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts.
The following table depicts the performance of loans that have been modified in the last 12 months:
PERFORMANCE OF LOANS THAT HAVE BEEN MODIFIED IN THE LAST 12 MONTHS
March 31, 2024
(Dollars in millions)Current30-89 Days Past Due90+ Days Past DueNon-Accruing
C&I$100 $1 $— $18 
CRE19 — — 28 
Consumer Real Estate4 — — 3 
Credit Card and Other— — — — 
Total$123 $1 $— $49