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Fair Value Of Assets And Liabilities (Tables)
 6 Months Ended
Jun. 30, 2012
Fair Value Of Assets And Liabilities [Abstract]  
Schedule Of Assets And Liabilities Measured At Fair Value On A Recurring Basis
Recurring Fair Value Measurements   
                
The following table presents the balance of assets and liabilities measured at fair value on a recurring basis as of June 30, 2012:  
                
    June 30, 2012 
(Dollars in thousands)Level 1 Level 2 Level 3 Total 
Trading securities - capital markets:            
 U.S. treasuries$ - $ 115,210 $ - $ 115,210 
 Government agency issued MBS  -   469,805   -   469,805 
 Government agency issued CMO  -   125,404   -   125,404 
 Other U.S. government agencies  -   275,756   -   275,756 
 States and municipalities  -   46,596   -   46,596 
 Corporate and other debt  -   295,051   5   295,056 
 Equity, mutual funds, and other  -   9,732   -   9,732 
  Total trading securities - capital markets   -   1,337,554   5   1,337,559 
Trading securities - mortgage banking            
 Principal only  -   5,667   -   5,667 
 Interest only  -   -   14,900   14,900 
  Total trading securities - mortgage banking  -   5,667   14,900   20,567 
Loans held-for-sale  -   8,923   214,560   223,483 
Securities available for sale:            
 U.S. treasuries  -   39,996   -   39,996 
 Government agency issued MBS  -   1,383,724   -   1,383,724 
 Government agency issued CMO  -   1,589,376   -   1,589,376 
 Other U.S. government agencies  -   8,492   4,661   13,153 
 States and municipalities  -   16,470   1,500   17,970 
 Corporate and other debt  521   -   -   521 
 Venture capital  -   -   9,000   9,000 
 Equity, mutual funds, and other  13,263   -   -   13,263 
  Total securities available-for-sale  13,784   3,038,058   15,161   3,067,003 
Mortgage servicing rights  -   -   129,291   129,291 
Other assets:            
 Deferred compensation assets  22,645   -   -   22,645 
 Derivatives, forwards and futures  22,523   -   -   22,523 
 Derivatives, interest rate contracts   -   318,287   -   318,287 
  Total other assets  45,168   318,287   -   363,455 
  Total assets$ 58,952 $ 4,708,489 $ 373,917 $ 5,141,358 
Trading liabilities - capital markets:            
 U.S. treasuries$ - $ 260,547 $ - $ 260,547 
 Government agency issued MBS  -   473   -   473 
 Other U.S. government agencies  -   27,152   -   27,152 
 Corporate and other debt  -   182,209   -   182,209 
 Other  -   250   -   250 
   Total trading liabilities - capital markets  -   470,631   -   470,631 
Other short-term borrowings  -   -   12,439   12,439 
             
Other liabilities:            
 Derivatives, forwards and futures  7,430   -   -   7,430 
 Derivatives, interest rate contracts   -   224,546   -   224,546 
 Derivatives, other  -   9   3,505   3,514 
  Total other liabilities  7,430   224,555   3,505   235,490 
  Total liabilities$ 7,430 $ 695,186 $ 15,944 $ 718,560 

The following table presents the balance of assets and liabilities measured at fair value on a recurring basis as of June 30, 2011:
                
    June 30, 2011 
(Dollars in thousands)Level 1 Level 2 Level 3 Total 
Trading securities - capital markets:            
 U.S. treasuries$ - $ 218,302 $ - $ 218,302 
 Government agency issued MBS  -   361,421   -   361,421 
 Government agency issued CMO  -   133,841   -   133,841 
 Other U.S. government agencies  -   192,643   -   192,643 
 States and municipalities  -   19,093   -   19,093 
 Corporate and other debt  -   239,205   5   239,210 
 Equity, mutual funds, and other  -   247   -   247 
  Total trading securities - capital markets   -   1,164,752   5   1,164,757 
Trading securities - mortgage banking            
  Principal only  -   8,775   -   8,775 
  Interest only  -   -   22,848   22,848 
  Total trading securities - mortgage banking  -   8,775   22,848   31,623 
Loans held-for-sale  -   9,372   215,870   225,242 
Securities available for sale:            
 U.S. treasuries  -   46,250   -   46,250 
 Government agency issued MBS  -   1,501,767   -   1,501,767 
 Government agency issued CMO  -   1,423,894   -   1,423,894 
 Other U.S. government agencies  -   13,246   6,681   19,927 
 States and municipalities  -   17,865   1,500   19,365 
 Corporate and other debt  540   -   -   540 
 Venture capital  -   -   13,179   13,179 
 Equity, mutual funds, and other  7,279   -   -   7,279 
  Total securities available-for-sale  7,819   3,003,022   21,360   3,032,201 
Mortgage servicing rights  -   -   186,958   186,958 
Other assets:            
  Deferred compensation assets  25,356   -   -   25,356 
  Derivatives, forwards and futures  12,200   -   -   12,200 
  Derivatives, interest rate contracts  -   292,476   -   292,476 
  Total other assets  37,556   292,476   -   330,032 
  Total assets$ 45,375 $ 4,478,397 $ 447,041 $ 4,970,813 
Trading liabilities - capital markets:            
 U.S. treasuries$ - $ 331,864 $ - $ 331,864 
 Government agency issued MBS  -   238   -   238 
 Government agency issued CMO  -   122   -   122 
 Other U.S. government agencies  -   6,026   -   6,026 
 Corporate and other debt  -   160,665   -   160,665 
  Total trading liabilities - capital markets  -   498,915   -   498,915 
Other short-term borrowings  -   -   23,645   23,645 
Other liabilities:            
  Derivatives, forwards and futures  16,509   -   -   16,509 
  Derivatives, interest rate contracts  -   194,504   -   194,504 
  Derivatives, other  -   6   1,270   1,276 
  Total other liabilities  16,509   194,510   1,270   212,289 
  Total liabilities$ 16,509 $ 693,425 $ 24,915 $ 734,849 
Summary Of Changes In Level 3 Assets And Liabilities Measured At Fair Value
Changes in Recurring Level 3 Fair Value Measurements   
                              
The changes in Level 3 assets and liabilities measured at fair value for the three months ended June 30, 2012 and 2011, on a recurring basis are summarized as follows:
                              
   Three Months Ended June 30, 2012  
           Securities available-for-sale  Mortgage      Other   
   Trading  Loans held-  Investment  Venture  servicing  Net derivative  short-term  
(Dollars in thousands)securities  for-sale  portfolio Capital  rights, net  liabilities  borrowings  
Balance on April 1, 2012$ 17,386  $ 214,603  $ 6,594 $ 12,179  $ 142,956  $ (2,960)  $ (15,073)  
 Total net gains/(losses) included in:                           
   Net income  (99)    1,078    -   5,071    (6,914)    (869)    2,634  
   Other comprehensive income  -    -    (4)   -    -    -    -  
 Purchases  -    7,740    -   -    -    -    -  
 Issuances  -    -    -   -    -    -    -  
 Sales  -    -    -   (8,250)    -    -    -  
 Settlements  (2,382)    (8,108)    (428)   -    (6,751)    324    -  
 Net transfers into/(out of) Level 3  -    (753) (c)     -   -    -    -    -  
Balance on June 30, 2012$ 14,905  $ 214,560  $ 6,162 $ 9,000  $ 129,291  $ (3,505)  $ (12,439)  
Net unrealized gains/(losses) included in net income$ (518) (a)   $ 1,078 (a)   $ - $ - (b)   $ (6,831) (a)   $ (869) (d)   $ 2,634 (a)   

   Three Months Ended June 30, 2011  
          Securities available-for-sale Mortgage      Other   
   Trading  Loans held- Investment  Venture servicing  Net derivative  short-term  
(Dollars in thousands)securities  for-sale portfolio Capital rights, net  liabilities  borrowings  
Balance on April 1, 2011$ 25,370  $ 209,863  $ 8,428 $ 13,179 $ 207,748  $ (2,100)  $ (27,991)  
 Total net gains/(losses) included in:                          
   Net income  733    (4,069)    -   -   (15,006)    (32)    4,346  
   Other comprehensive income  -    -    58   -   -    -    -  
 Purchases  -    23,079    -   -   -    -    -  
 Issuances  -    -    -   -   -    -    -  
 Sales  (132)    -    -   -   -    -    -  
 Settlements  (3,118)    (10,519)    (305)   -   (5,784)    862    -  
 Net transfers into/(out of) Level 3   -    (2,484) (c)     -   -   -    -    -  
Balance on June 30, 2011$ 22,853  $ 215,870  $ 8,181 $ 13,179 $ 186,958  $ (1,270)  $ (23,645)  
Net unrealized gains/(losses) included in net income$ 286 (a)   $ (4,069) (a)   $ - $ -(b)$ (14,802) (a)   $ (32) (d)   $ 4,346 (a)   

  • Primarily included in mortgage banking income on the Consolidated Condensed Statements of Income.
  • Represents recognized gains and losses attributable to venture capital investments classified within securities available-for-sale that are included in securities gains/(losses) in noninterest income.
  • Transfers out of recurring level 3 balances reflect movements out of loans held-for-sale and into real estate acquired by foreclosure (level 3 nonrecurring).
  • Included in Other expense.

 

Changes in Recurring Level 3 Fair Value Measurements
                              
The changes in Level 3 assets and liabilities measured at fair value for the six months ended June 30, 2012 and 2011, on a recurring basis are summarized as follows: 
                              
   Six Months Ended June 30, 2012  
           Securities available-for-sale  Mortgage      Other   
   Trading  Loans held-  Investment  Venture  servicing  Net derivative  short-term  
(Dollars in thousands)securities  for-sale  portfolio Capital  rights, net  liabilities  borrowings  
Balance on January 1, 2012$ 18,059  $ 210,487  $ 7,262 $ 12,179  $ 144,069  $ (11,820)  $ (14,833)  
 Total net gains/(losses) included in:                           
  Net income  1,779    1,950    -   5,071    (2,443)    (1,611)    2,394  
  Other comprehensive income  -    -    (170)   -    -    -    -  
 Purchases  -    19,182    -   -    -    -    -  
 Issuances  -    -    -   -    -    -    -  
 Sales  -    -    -   (8,250)    -    -    -  
 Settlements  (4,933)    (16,160)    (930)   -    (12,335)    9,926    -  
 Net transfers into/(out of) Level 3  -    (899) (c)     -   -    -    -    -  
Balance on June 30, 2012$ 14,905  $ 214,560  $ 6,162 $ 9,000  $ 129,291  $ (3,505)  $ (12,439)  
Net unrealized gains/(losses) included in net income$ 888 (a)   $ 1,950 (a)   $ - $ - (b)   $ (1,618) (a)   $ (1,611) (d)   $ 2,394 (a)   

   Six Months Ended June 30, 2011 
           Securities available-for-sale Mortgage      Other   
   Trading  Loans held-  Investment  Venture servicing  Net derivative  short-term  
(Dollars in thousands)securities  for-sale  portfolio Capital rights, net  liabilitiesborrowings  
Balance on January 1, 2011$ 26,478  $ 207,632  $ 39,391 $ 13,179 $ 207,319  $ (1,000)  $ (27,309)  
 Total net gains/(losses) included in:                          
  Net income  2,933    (8,194)    -   -   (7,359)    (1,132)    3,664  
  Other comprehensive income  -    -    (1,688)   -   -    -    -  
 Purchases  -    39,120    -   -   -    -    -  
 Issuances  -    -    -   -   -    -    -  
 Sales  (132)    -    (29,217)   -   -    -    -  
 Settlements  (6,426)    (19,869)    (305)   -   (13,002)    862    -  
 Net transfers into/(out of) Level 3   -    (2,819) (c)     -   -   -    -    -  
Balance on June 30, 2011$ 22,853  $ 215,870  $ 8,181 $ 13,179 $ 186,958  $ (1,270)  $ (23,645)  
Net unrealized gains/(losses) included in net income$ 2,059 (a)   $ (8,194) (a)   $ - $ -(b)$ (7,048)(a)   $ (667) (d)   $ 3,664(a)   

Certain previously reported amounts have been reclassified to agree with current presentation.

 

  • Primarily included in mortgage banking income on the Consolidated Condensed Statements of Income.
  • Represents recognized gains and losses attributable to venture capital investments classified within securities available-for-sale that are included in securities gains/(losses) in noninterest income.
  • Transfers out of recurring level 3 balances reflect movements out of loans held-for-sale and into real estate acquired by foreclosure (level 3 nonrecurring).
  • Included in Other expense.
Nonrecurring Fair Value Measurements
               Three Months Ended Six Months Ended  
 Carrying value at June 30, 2012June 30, 2012 June 30, 2012  
(Dollars in thousands)  Level 1 Level 2 Level 3 Total  Net gains/(losses) Net gains/(losses)  
Loans held-for-sale - SBAs  $ - $ 53,807 $ - $ 53,807 $ 12 $ 16  
Loans held-for-sale - first mortgages    -   -   14,691   14,691   (452)   316  
Loans, net of unearned income (a)  -   -   106,864   106,864   (5,963)   (15,013)  
Real estate acquired by foreclosure (b)  -   -   48,916   48,916   (4,167)   (9,392)  
Other assets (c)  -   -   82,287   82,287   (1,219)   (3,204)  
               $ (11,789) $ (27,277)  

             Three Months Ended Six Months Ended  
 Carrying value at June 30, 2011 June 30, 2011 June 30, 2011  
(Dollars in thousands)  Level 1 Level 2 Level 3 Total  Net gains/(losses) Net gains/(losses)  
Loans held-for-sale - SBAs  $ - $ 49,641 $ - $ 49,641 $ (2) $ (2)  
Loans held-for-sale - first mortgages    -   -   14,569   14,569   (3,458)   (4,618)  
Loans, net of unearned income (a)  -   -   169,448   169,448   (5,257)   (17,759)  
Real estate acquired by foreclosure (b)  -   -   78,792   78,792   (4,612)   (9,651)  
Other assets (c)  -   -   79,053   79,053   (1,809)   (4,355)  
               $ (15,138) $ (36,385)  

  • Represents carrying value of loans for which adjustments are based on the appraised value of the collateral. Write-downs on these loans are recognized as part of provision.
  • Represents the fair value and related losses of foreclosed properties that were measured subsequent to their initial classification as foreclosed assets. Balance excludes foreclosed real estate related to government insured mortgages.
  • Represents low income housing investments. 2012 also includes new market tax credit investments.

 
Schedule Of Unobservable Inputs Utilized In Determining The Fair Value Of Level 3 Recurring And Non-Recurring Measurements
Level 3 Measurements 
The following table provides information regarding the unobservable inputs utilized in determining the fair value of level 3 recurring and non-recurring measurements as of June 30, 2012: 
           
(Dollars in Thousands)         
  Fair Value at        
Level 3 Class June 30, 2012Valuation TechniquesUnobservable InputValues Utilized 
Interest only trading securities $14,900 Discounted cash flow (a) (a) 
Loans held-for-sale - mortgages  229,251 Discounted cash flow Prepayment speeds 6% - 10% 
      Credit spreads 2% - 4% 
       Delinquency adjustment factor 15% - 25% added to credit spread 
       Loss severity trends 50% - 60% of UPB 
Venture capital investments  9,000 Recent purchase offers Adjustment for preferences in equity tranches 0% - 10% discount 
     Recent capitalization transactions Adjustment for preferences in equity tranches 0% - 10% discount 
Mortgage servicing rights  129,291 Discounted cash flow (a) (a) 
Other short-term borrowings  12,439 Discounted cash flow (b) (b) 
Derivative liabilities, other  3,505 Discounted cash flow Visa covered litigation resolution amount $4.3 billion - $5.1 billion 
       Probability of resolution scenarios 10%-30% 
       Time until resolution 3 - 12 months 
Loans, net of unearned income (c)  106,864 Appraisals from comparable properties Adjustment for value changes since appraisal 5% - 15% of appraisal 
     Other collateral valuations Borrowing base certificates 20% - 50% of gross value 
       Financial Statements/Auction Values 0% - 25% of reported value 
Real estate acquired by foreclosure (d)  48,916 Appraisals from comparable properties Adjustment for value changes since appraisal 0% - 10% of appraisal 
Other assets (e)  82,287 Discounted cash flow Adjustments to current sales yields for specific properties 0% - 15% adjustment to yield 
     Appraisals from comparable properties Marketability adjustments for specific properties 0% - 25% of appraisal 

  • The unobservable inputs for Interest-only trading securities and MSR are discussed in Note 12 – Loan Sales and Securitizations.
  • The inputs and associated ranges for Other short-term borrowings mirror those of the related MSR.
  • Represents carrying value of loans for which adjustments are based on the appraised value of the collateral. Write-downs on these loans are recognized as part of provision.
  • Represents the fair value and related losses of foreclosed properties that were measured subsequent to their initial classification as foreclosed assets. Balance excludes foreclosed real estate related to government insured mortgages.
  • Represents low income housing investments and new market tax credit investments.
Summary Of Differences Between The Fair Value Carrying Amount Of Mortgages Held-For-Sale And Aggregate Unpaid Principal Amount
The following table reflects the differences between the fair value carrying amount of mortgages held-for-sale measured at fair value in accordance with management’s election and the aggregate unpaid principal amount FHN is contractually entitled to receive at maturity. 
  June 30, 2012 
(Dollars in thousands)Fair value carrying amount Aggregate unpaid principal Fair value carrying amount less aggregate unpaid principal 
Loans held-for-sale reported at fair value:          
 Total loans$223,483 $311,724 $  (88,241) 
 Nonaccrual loans 40,114  87,022    (46,908) 
 Loans 90 days or more past due and still accruing 10,350  22,460    (12,110) 
            
  June 30, 2011 
(Dollars in thousands)Fair value carrying amount Aggregate unpaid principal Fair value carrying amount less aggregate unpaid principal 
Loans held-for-sale reported at fair value:          
 Total loans$225,242 $298,681 $  (73,439) 
 Nonaccrual loans 40,927  83,372    (42,445) 
 Loans 90 days or more past due and still accruing 10,866  21,587    (10,721) 
Changes In Fair Value Of Assets And Liabilities Which Fair Value Option Included In Current Period Earnings
Assets and liabilities accounted for under the fair value election are initially measured at fair value with subsequent changes in fair value recognized in earnings. Such changes in the fair value of assets and liabilities for which FHN elected the fair value option are included in current period earnings with classification in the income statement line item reflected in the following table: 
               
   Three Months Ended Six Months Ended 
   June 30June 30 
(Dollars in thousands)2012 2011 2012 2011 
Changes in fair value included in net income:            
 Mortgage banking noninterest income            
  Loans held-for-sale$ 1,078 $ (4,069) $ 1,950 $ (8,194) 
  Other short-term borrowings  2,634   4,346   2,394   3,664 
Summary Of Book Value And Estimated Fair Value Of Financial Instruments
      June 30, 2012 
    Book Fair Value 
(Dollars in thousands)  Value Level 1 Level 2 Level 3 Total 
Assets:                 
Loans, net of unearned income and allowance for loan losses                 
 Commercial:                 
  Commercial, financial and industrial  $7,870,720   -   - $ 7,649,105 $ 7,649,105 
  Commercial real estate                 
   Income CRE   1,195,608   -   -   1,129,205   1,129,205 
   Residential CRE   77,013   -   -   69,380   69,380 
 Retail:                 
  Consumer real estate (c) 5,722,144   -   -   5,230,876   5,230,876 
  Permanent mortgage (c) 726,595   -   -   626,914   626,914 
  Credit card & other   272,632   -   -   273,276   273,276 
Total loans, net of unearned income and allowance for loan losses   15,864,712   -   -   14,978,756   14,978,756 
          
Short-term financial assets                 
 Total interest-bearing cash    484,430   484,430   -   -   484,430 
 Total federal funds sold & securities purchased under agreements to resell    525,504   -   525,504   -   525,504 
Total short-term financial assets    1,009,934   484,430   525,504   -   1,009,934 
          
Trading securities (a) (d) 1,361,717   -   1,343,221  18,496  1,361,717 
Loans held-for-sale (a) 424,051   -   62,730  361,321  424,051 
Securities available-for-sale (a) (b) 3,264,866   13,784   3,038,058  213,024  3,264,866 
Derivative assets (a) 340,810   22,523   318,287  0  340,810 
          
Other assets                 
 Low income housing and new market tax credit investments   82,287   -   -   82,287   82,287 
 Deferred compensation assets   22,645   22,645   -   -   22,645 
Total other assets   104,932   22,645   -   82,287   104,932 
          
Nonearning assets                 
 Cash & due from banks    330,931   330,931   -   -   330,931 
 Capital markets receivables    377,496   -   377,496   -   377,496 
 Accrued interest receivable    75,958   -   75,958   -   75,958 
Total nonearning assets    784,385   330,931   453,454   -   784,385 
Total assets  $ 23,155,407 $ 874,313 $ 5,741,254 $ 15,653,884 $ 22,269,451 
                     
Liabilities:                 
Deposits:                 
 Defined maturity  $1,737,702 $ - $ 1,776,607 $ - $ 1,776,607 
 Undefined maturity   14,379,741   -   14,379,741   -   14,379,741 
Total deposits   16,117,443   -   16,156,348   -   16,156,348 
                   
Trading liabilities (a) 470,631   -   470,631   -  470,631 
                   
Short-term financial liabilities                 
 Total federal funds purchased & securities sold under agreements to repurchase   1,780,990   -   1,780,990   -   1,780,990 
 Total other borrowings   1,094,179   -   1,081,740   12,439   1,094,179 
Total short-term financial liabilities   2,875,169   -   2,862,730   12,439   2,875,169 
                   
Term borrowings                 
 Real estate investment trust-preferred   45,726   -   -   39,950   39,950 
 Term borrowings - new market tax credit investment   15,301   -   -   16,253   16,253 
 Borrowings secured by residential real estate   445,298   -   -   356,238   356,238 
 Other long term borrowings   1,787,899   -   1,673,360   -   1,673,360 
Total term borrowings 2,294,224   -   1,673,360   412,441   2,085,801 
                   
Derivative liabilities (a) 235,490  7,430  224,555  3,505  235,490 
          
Other noninterest-bearing liabilities                 
 Capital markets payables    203,548   -   203,548   -   203,548 
 Accrued interest payable    29,928   -   29,928   -   29,928 
Total other noninterest-bearing liabilities    233,476   -   233,476   -   233,476 
Total liabilities  $ 22,226,433 $ 7,430 $ 21,621,100 $ 428,385 $ 22,056,915 

  • Classes are detailed in the recurring and nonrecurring measurement tables.
  • Level 3 includes restricted investments in FHLB-Cincinnati stock of $125.5 million and FRB stock of $66.0 million.
  • Includes restricted real estate loans and secured borrowings.
  • Level 3 includes $3.6 million of trading loans not recorded at fair value.

  June 30, 2011 
  Book Fair 
(Dollars in thousands)ValueValue
Assets:      
Loans, net of unearned income and allowance for loan losses$15,537,555 $14,667,125 
Short-term financial assets 861,441  861,441 
Trading securities 1,196,380  1,196,380 
Loans held-for-sale 397,931  397,931 
Securities available-for-sale 3,230,477  3,230,477 
Derivative assets 304,676  304,676 
Other assets 104,409  104,409 
Nonearning assets 1,019,589  1,019,589 
Liabilities:      
Deposits:      
 Defined maturity$1,791,174 $1,840,353 
 Undefined maturity 14,104,853  14,104,853 
Total deposits 15,896,027  15,945,206 
Trading liabilities 498,915  498,915 
Short-term financial liabilities 2,193,901  2,193,901 
Term borrowings 2,502,517  2,301,311 
Derivative liabilities 212,289  212,289 
Other noninterest-bearing liabilities 498,726  498,726 

 Contractual Amount Fair Value  
 June 30, 2012 June 30, 2011 June 30, 2012 June 30, 2011  
Unfunded Commitments:             
Loan commitments$7,868,558 $7,938,091 $1,597 $1,234  
Standby and other commitments 376,450  391,539  5,433  6,534