The following table provides the balance of loans by portfolio segment as of June 30, 2014 and 2013, and December 31, 2013:

			June 30			December 31
(Dollars in thousands)		2014		2013		2013
Commercial:
	Commercial, financial, and industrial (a)	$	8,402,836	$	8,368,067	$	7,923,576
	Commercial real estate		1,231,513		1,218,206		1,133,279
Retail:
	Consumer real estate (b)		5,218,930		5,549,440		5,333,371
	Permanent mortgage (c)		594,001		746,154		662,242
	Credit card & other		348,429		316,085		336,606
Loans, net of unearned income (a)		$	15,795,709	$	16,197,952	$	15,389,074
Allowance for loan losses			243,628		261,934		253,809
Total net loans (a)		$	15,552,081	$	15,936,018	$	15,135,265

The loan portfolio is disaggregated into 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 determined based on the initial measurement attribute (i.e., amortized cost or purchased credit-impaired ("PCI")), risk characteristics of the loan, and FHN's method for monitoring and assessing credit risk. Commercial loan portfolio segments include commercial, financial and industrial ("C&I") and commercial real estate ("CRE"). Commercial classes within C&I include general C&I, loans to mortgage companies, the trust preferred loans ("TRUPS") (i.e. long-term unsecured loans to bank and insurance - related businesses) portfolio and PCI loans. Loans to mortgage companies includes commercial lines of credit to qualified mortgage companies exclusively for the temporary warehousing of eligible mortgage loans prior to the borrower's sale of those mortgage loans to third party investors. Commercial classes within commercial real estate include income CRE, residential CRE and PCI loans. Retail loan portfolio segments include consumer real estate, permanent mortgage, and the credit card and other portfolio. Retail classes include HELOC, real estate ("R/E") installment and PCI loans within the consumer real estate segment, permanent mortgage (which is both a segment and a class), and credit card and other.

FHN has a concentration of loans secured by residential real estate (37 percent of total loans), the majority of which is in the consumer real estate portfolio (33 percent of total loans). Loans to finance and insurance companies total $1.7 billion (21 percent of the C&I portfolio, or 11 percent of the total loans). FHN had loans to mortgage companies, commercial lines of credit to qualified mortgage companies exclusively for the temporary warehousing of eligible mortgage loans prior to the borrower's sale of those mortgage loans to third party investors, totaling $1.1 billion (13 percent of the C&I portfolio, or 7 percent of total loans) as of June 30, 2014. As a result, 34 percent of the C&I category was sensitive to impacts on the financial services industry.

On June 7, 2013, FHN acquired substantially all of the assets and liabilities of MNB from the FDIC. The acquisition included approximately $249 million of loans. These loans were initially recorded at fair value which incorporates expected credit losses, among other things, in accordance with ASC 805 resulting in no carryover of allowance for loan loss ("ALLL") from the acquiree. At acquisition, FHN designated certain loans as PCI (see discussion below) with the remaining loans accounted for under ASC 310-20, "Nonrefundable Fees and Other Costs". For loans accounted for under ASC 310-20, the difference between the loans' book value to MNB and the estimated fair value at the time of the acquisition will be accreted back into interest income over the remaining contractual life and the subsequent accounting and reporting will be similar to FHN's originated loan portfolio.

ASC 310-30, "Accounting for Certain Loans or Debt Securities Acquired in a Transfer," provides guidance for acquired loans that have experienced deterioration of credit quality between origination and the time of acquisition and for which the timely collection of the interest and principal is no longer reasonably assured PCI loans. FHN considered several factors when determining whether a loan met the definition of a PCI loan at the time of acquisition including accrual status, loan grade, delinquency trends, prior partial charge-offs, as well as both originated versus refreshed credit scores and ratios when available.

PCI loans were initially recorded at fair value which was estimated by discounting expected cash flows at acquisition date. The expected cash flow includes all contractually expected amounts (including interest) and incorporates an estimate for future expected credit losses, pre-payment assumptions, and yield requirement for a market participant, among other things. To the extent possible, certain PCI loans were aggregated into pools with composite interest rate and cash flows expected to be collected for the pool. Aggregation into loan pools is based on common risk characteristics that include similar credit risk or risk ratings, and one or more predominant risk characteristics. Generally, FHN pooled loans with smaller balances and common internal loan grades and portfolio types. Subsequent to the initial accounting at acquisition, each PCI pool is accounted for as a single unit.

Accretable yield is initially established at acquisition and is the excess of cash flows expected to be collected over the initial investment in the loan and is recognized in interest income over the remaining life of the loan, or pool of loans. Nonaccretable difference is the difference between the contractually required payments at acquisition and the cash flows expected to be collected at acquisition. FHN estimates expected cash flows for PCI loans on a quarterly basis. Increases in expected cash flows from the last measurement will result in reversal of any nonaccretable difference (or allowance for loan losses to the extent any has been recorded) with a prospective positive impact on interest income. Decreases to the expected cash flows will result in an increase in the allowance for loan losses through increased provision expense.

FHN does not report PCI loans as nonperforming loans due to the accretion of interest income. Additionally, PCI loans that have been pooled and subsequently modified will not be reported as troubled debt restructurings since the pool is the unit of measurement.

The following table presents a rollforward of the accretable yield for the three and six months ended June 30, 2014 and 2013:

	Three Months Ended					Six Months Ended
		June 30				June 30
(Dollars in thousands)		2014		2013		2014		2013
Balance, beginning of period	$	15,828	$	-	$	13,490	$	-
Additions (a)		224		6,650		335		6,650
Accretion		(1,927)		(218)		(3,584)		(218)
Adjustment for payoffs		(489)		-		(722)		-
Adjustment for charge-offs		(5)		-		(69)		-
Increase in accretable yield (b)		2,878		-		7,059		-
Balance, end of period (a)	$	16,509	$	6,432	$	16,509	$	6,432

At June 30, 2014, the ALLL related to PCI loans was $2.5 million and loan loss provision recognized during the three and six months ended June 30, 2014 was $.6 million and $1.7 million, respectively. The following table reflects the outstanding principal balance and carrying amounts of the acquired PCI loans as of June 30, 2014, and 2013, and December 31, 2013:

		June 30, 2014				June 30, 2013				December 31, 2013
(Dollars in thousands)		Carrying value		Unpaid balance		Carrying value		Unpaid balance		Carrying value		Unpaid balance
Commercial, financial and industrial	(a)	$	6,738	$	8,256	$	7,748	$	9,568	$	7,077	$	9,169
Commercial real estate	(a)		32,938		45,295		40,480		56,927		38,042		53,648
Consumer real estate	(a)		733		1,074		897		1,307		878		1,291
Credit card and other			11		16		18		26		12		21
Total	(a)	$	40,420	$	54,641	$	49,143	$	67,828	$	46,009	$	64,129

Balances as of June 30, 2013 have been re-presented as the PCI loan population was finalized in third quarter 2013.

Impaired Loans

The following tables provide information at June 30, 2014 and 2013, by class related to individually impaired loans and consumer TDR's. Recorded investment is defined as the amount of the investment in a loan, before valuation allowance but which does reflect any direct write-down of the investment. For purposes of this disclosure, PCI loans and LOCOM have been excluded.

									Three Months Ended				Six Months Ended
		June 30, 2014							June 30, 2014				June 30, 2014
				Unpaid				Average		Interest		Average		Interest
		Recorded		Principal		Related		Recorded		Income		Recorded		Income
(Dollars in thousands)		Investment		Balance		Allowance		Investment		Recognized		Investment		Recognized
Impaired loans with no related allowance recorded:
Commercial:
	General C&I	$	15,489	$	17,280	$	-	$	14,809	$	-	$	17,594	$	-
	TRUPS		-		-		-		-		-		1,625		-
	Income CRE		6,838		14,397		-		7,669		-		8,090		-
	Residential CRE		1,148		1,827		-		574		-		287		-
	Total	$	23,475	$	33,504	$	-	$	23,052	$	-	$	27,596	$	-
Retail:
	HELOC (a)	$	17,390	$	38,216	$	-	$	16,771	$	-	$	16,629	$	-
	R/E installment loans (a)		7,464		10,009		-		8,932		-		9,818		-
	Permanent mortgage (a)		7,862		9,785		-		7,858		-		8,007		-
	Total	$	32,716	$	58,010	$	-	$	33,561	$	-	$	34,454	$	-
Impaired loans with related allowance recorded:
Commercial:
	General C&I	$	32,395	$	38,331	$	3,150	$	30,059	$	78	$	26,146	$	157
	TRUPS		3,520		3,700		925		8,535		-		16,057		-
	Income CRE		8,842		10,214		641		10,331		62		11,214		164
	Residential CRE		6,029		11,477		667		6,204		61		6,426		124
	Total	$	50,786	$	63,722	$	5,383	$	55,129	$	201	$	59,843	$	445
Retail:
	HELOC	$	77,283	$	78,492	$	17,475	$	75,285	$	457	$	73,539	$	891
	R/E installment loans		74,748		75,634		26,450		74,243		297		73,629		566
	Permanent mortgage		111,604		125,012		19,323		112,796		706		113,145		1,429
	Credit card & other		524		524		266		648		5		653		16
	Total	$	264,159	$	279,662	$	63,514	$	262,972	$	1,465	$	260,966	$	2,902
Total commercial		$	74,261	$	97,226	$	5,383	$	78,181	$	201	$	87,439	$	445
Total retail		$	296,875	$	337,672	$	63,514	$	296,533	$	1,465	$	295,420	$	2,902
Total impaired loans		$	371,136	$	434,898	$	68,897	$	374,714	$	1,666	$	382,859	$	3,347

								Three Months Ended				Six Months Ended
		June 30, 2013							June 30,2013			June 30,2013
				Unpaid				Average		Interest		Average		Interest
		Recorded		Principal		Related		Recorded		Income		Recorded		Income
(Dollars in thousands)		Investment		Balance		Allowance		Investment		Recognized		Investment		Recognized
Impaired loans with no related allowance recorded:
Commercial:
	General C&I	$	47,432	$	55,225	$	-	$	54,140	$	28	$	53,873	$	108
	TRUPS		6,500		6,500		-		8,250		-		15,250		-
	Income CRE		22,978		33,744		-		25,557		93		28,389		168
	Residential CRE		10,967		15,997		-		12,630		59		12,803		122
	Total	$	87,877	$	111,466	$	-	$	100,577	$	180	$	110,315	$	398
Retail:
	HELOC (a)	$	19,709	$	41,264	$	-	$	20,383	$	-	$	20,023	$	-
	R/E installment loans (a)		12,193		15,184		-		12,761		-		11,258		-
	Permanent mortgage (a)		11,134		14,916		-		10,953		-		10,172		-
	Total	$	43,036	$	71,364	$	-	$	44,097	$	-	$	41,453	$	-
Impaired loans with related allowance recorded:
Commercial:
	General C&I	$	24,216	$	30,555	$	2,433	$	13,985	$	37	$	17,258	$	37
	TRUPS		43,700		43,700		13,768		41,950		-		38,700		-
	Income CRE		4,830		6,129		441		2,950		15		2,954		26
	Residential CRE		2,081		3,944		111		1,041		16		521		16
	Total	$	74,827	$	84,328	$	16,753	$	59,926	$	68	$	59,433	$	79
Retail:
	HELOC	$	67,672	$	68,336	$	18,122	$	65,369	$	464	$	63,661	$	890
	R/E installment loans		78,624		79,594		24,271		73,549		404		74,157		689
	Permanent mortgage		111,997		124,869		22,725		110,640		705		111,856		1,388
	Credit card & other		717		717		240		732		8		767		16
	Total	$	259,010	$	273,516	$	65,358	$	250,290	$	1,581	$	250,441	$	2,983
Total commercial		$	162,704	$	195,794	$	16,753	$	160,503	$	248	$	169,748	$	477
Total retail		$	302,046	$	344,880	$	65,358	$	294,387	$	1,581	$	291,894	$	2,983
Total impaired loans		$	464,750	$	540,674	$	82,111	$	454,890	$	1,829	$	461,642	$	3,460
Certain previously reported amounts have been reclassified to agree with current presentation.

FHN employs a dual grade commercial risk grading methodology to assign an estimate for the probability of default ("PD") and the loss given default ("LGD") 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. Each PD grade corresponds to an estimated one-year default probability percentage; a PD 1 has the lowest expected default probability, and probabilities increase as grades progress down the scale. 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). Pass loan grades are required to be reassessed annually or earlier whenever there has been a material change in the financial condition of the borrower or risk characteristics of the relationship. All commercial loans over $1 million and certain commercial loans over $500,000 that are graded 13 or worse are reassessed on a quarterly basis. LGD grades are assigned based on a scale of 1-12 and represent FHN's expected recovery based on collateral type in the event a loan defaults. See Note 5 - Allowance for Loan Losses for further discussion on the credit grading system.

The following tables provide the balances of commercial loan portfolio classes with associated allowance, disaggregated by PD grade as of June 30, 2014 and 2013.
	June 30, 2014
			Loans to												Allowance
	General		Mortgage				Income		Residential				Percentage		for Loan
(Dollars in thousands)	C&I		Companies		TRUPS (a)		CRE		CRE		Total		of Total		Losses
PD Grade:
1	$	366,235	$	-	$	-	$	-	$	-	$	366,235	4	%	$	-
2		260,581		-		-		3,110		235		263,926	3			245
3		360,700		76,569		-		983		-		438,252	5			307
4		387,884		77,110		-		7,591		-		472,585	5			746
5		760,726		62,031		-		158,071		6,041		986,869	10			2,579
6		991,013		199,651		-		189,927		4,738		1,385,329	14			1,674
7		1,189,915		182,749		-		285,384		6,087		1,664,135	17			2,696
8		771,697		301,174		-		227,419		53		1,300,343	13			2,739
9		686,657		123,423		-		108,523		5,911		924,514	10			5,896
10		375,862		77,058		-		40,228		1,563		494,711	5			5,379
11		361,870		1,517		-		26,275		2,128		391,790	4			8,397
12		136,560		-		-		32,356		994		169,910	2			1,857
13		120,903		-		325,882		8,938		2,007		457,730	5			6,435
14,15,16		137,500		-		9,385		49,842		4,944		201,671	2			37,666
Collectively evaluated for impairment		6,908,103		1,101,282		335,267		1,138,647		34,701		9,518,000	99			76,616
Individually evaluated for impairment		47,884		-		3,520		15,680		7,177		74,261	1			5,383
Purchased credit-impaired loans		6,780		-		-		33,351		1,957		42,088	-			2,413
Total commercial loans	$	6,962,767	$	1,101,282	$	338,787	$	1,187,678	$	43,835	$	9,634,349	100	%	$	84,412

		June 30, 2013
				Loans to												Allowance
		General		Mortgage				Income		Residential				Percent of		for Loan
(Dollars in thousands)		C&I		Companies		TRUPS (a)		CRE		CRE		Total		Total		Losses
PD Grade:
1		$	227,858	$	-	$	-	$	-	$	-	$	227,858	2	%	$	75
2			176,086		-		-		1,809		116		178,011	2			73
3			186,420		-		-		5,520		-		191,940	2			207
4			295,896		-		-		7,763		321		303,980	3			455
5			658,296		-		-		33,783		128		692,207	7			1,321
6			989,615		141,660		-		175,144		10,288		1,316,707	14			2,812
7			1,023,498		379,727		-		218,459		2,292		1,623,976	17			3,469
8			956,367		532,802		-		222,598		4,837		1,716,604	19			5,677
9			665,510		286,958		-		127,895		1,134		1,081,497	11			9,779
10			435,497		45,532		-		137,057		529		618,615	6			8,030
11			428,761		-		-		40,635		1,238		470,634	5			10,336
12			126,410		-		-		39,872		2,431		168,713	2			2,885
13			151,532		-		332,708		32,488		768		517,496	5			9,013
14,15,16			200,683		343		3,335		63,723		9,175		277,259	3			36,548
Collectively evaluated for impairment			6,522,429		1,387,022		336,043		1,106,746		33,257		9,385,497	98			90,680
Individually evaluated for impairment			71,648		-		46,433		27,808		13,048		158,937	2			16,753
Total commercial loans	(b)	$	6,594,077	$	1,387,022	$	382,476	$	1,134,554	$	46,305	$	9,544,434	100	%	$	107,433

The retail 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 retail loan-types, FHN is able to utilize the Fair Isaac Corporation (“FICO”) score, among other attributes, to assess the 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 retail portfolio.

The following tables reflect period end balances and average FICO scores by origination vintage for the HELOC, real estate installment, and permanent mortgage classes of loans as of June 30, 2014 and 2013:

HELOC
	June 30, 2014						June 30, 2013
			Average		Average				Average		Average
(Dollars in thousands)	Period End		Origination		Refreshed		Period End		Origination		Refreshed
Origination Vintage	Balance		FICO		FICO		Balance		FICO		FICO
pre-2003	$	68,332		708		703	$	98,178		712		702
2003		120,962		723		710		186,941		730		719
2004		346,431		725		713		447,817		727		718
2005		500,404		732		722		572,954		733		720
2006		365,886		740		728		421,023		740		726
2007		384,391		743		729		441,879		744		728
2008		208,637		753		748		240,776		754		747
2009		110,934		751		745		126,901		751		743
2010		106,954		753		750		128,058		753		750
2011		105,295		759		755		124,889		759		755
2012		128,733		759		759		153,692		759		759
2013		167,149		760		760		72,772		760		759
2014		51,982		760		762		-		-		-
Total	$	2,666,090		741		732	$	3,015,880		740		730


R/E Installment Loans	June 30, 2014						June 30, 2013
			Average		Average				Average		Average
(Dollars in thousands)	Period End		Origination		Refreshed		Period End		Origination		Refreshed
Origination Vintage	Balance		FICO		FICO		Balance		FICO		FICO
pre-2003	$	18,623		680		683	$	29,998		683		684
2003		62,823		713		724		90,764		718		728
2004		47,502		700		699		61,949		702		705
2005		141,545		716		712		183,982		717		712
2006		156,538		714		702		197,308		716		704
2007		224,425		724		709		283,175		726		711
2008		74,106		721		714		98,690		724		719
2009		33,506		739		732		46,487		746		740
2010		113,437		748		754		138,621		747		753
2011		309,172		760		759		365,971		760		762
2012		653,179		764		765		727,688		764		764
2013		497,720		757		756		308,927		759		758
2014		220,264		756		754		-		-		-
Total	$	2,552,840		747		744	$	2,533,560		745		742


Permanent Mortgage	June 30, 2014						June 30, 2013
			Average		Average				Average		Average
(Dollars in thousands)	Period End		Origination		Refreshed		Period End		Origination		Refreshed
Origination Vintage	Balance		FICO		FICO		Balance		FICO		FICO
pre-2004	$	169,338		724		720	$	226,048		725		726
2004		19,378		713		714		26,804		714		692
2005		37,572		737		737		43,459		737		713
2006		68,693		730		721		86,655		733		712
2007		207,116		733		712		248,727		733		711
2008		91,904		741		704		114,461		742		713
Total	$	594,001		729		713	$	746,154		731		713

For all portfolio segments and classes other than PCI loans, loans are placed on nonaccrual status 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, or on a case-by-case basis if FHN continues to receive payments, but there are atypical loan structures or other borrower-specific issues. PCI loans are classified in the table below as accruing. FHN has a meaningful portion of loans that are classified as nonaccrual even though loan payments are being received; these include residential real estate loans where the borrower has been discharged of personal obligation through bankruptcy, and also current second lien loans behind first lien loans with performance issues. The determination of whether a TDR is placed on nonaccrual status generally follows the same internal policies and procedures as other portfolio loans. However, FHN will typically place a consumer real estate loan on nonaccrual status if it is 30 or more days delinquent at the time of modification and is determined to be a TDR, except for residential real estate secured loans discharged in bankruptcy (“discharged bankruptcies”) that are placed on nonaccrual regardless of delinquency status. Current stand-alone second liens are placed on nonaccrual status if they are junior to first liens that are 90 days or more past due or the first lien has been modified into a TDR.

The following table reflects accruing and non-accruing loans by class on June 30, 2014:

	Accruing								Non-Accruing
			30-89		90+						30-89		90+		Total
			Days		Days		Total				Days		Days		Non-		Total
(Dollars in thousands)	Current		Past Due		Past Due		Accruing		Current		Past Due		Past Due		Accruing		Loans
Commercial (C&I):
General C&I	$	6,900,880	$	9,707	$	704	$	6,911,291	$	13,105	$	3,850	$	27,741	$	44,696	$	6,955,987
Loans to mortgage companies		1,097,367		3,782		-		1,101,149		-		-		133		133		1,101,282
TRUPS (a)		335,267		-		-		335,267		-		-		3,520		3,520		338,787
Purchased credit-impaired loans		5,226		322		1,232		6,780		-		-		-		-		6,780
Total commercial (C&I)		8,338,740		13,811		1,936		8,354,487		13,105		3,850		31,394		48,349		8,402,836
Commercial real estate:
Income CRE		1,134,752		8,044		-		1,142,796		271		133		11,127		11,531		1,154,327
Residential CRE		39,429		-		-		39,429		1,297		-		1,152		2,449		41,878
Purchased credit-impaired loans		29,827		259		5,222		35,308		-		-		-		-		35,308
Total commercial real estate		1,204,008		8,303		5,222		1,217,533		1,568		133		12,279		13,980		1,231,513
Consumer real estate:
HELOC		2,548,170		19,772		9,677		2,577,619		71,653		5,888		10,930		88,471		2,666,090
R/E installment loans		2,490,461		11,264		7,889		2,509,614		32,881		3,002		6,568		42,451		2,552,065
Purchased credit-impaired loans		775		-		-		775		-		-		-		-		775
Total consumer real estate		5,039,406		31,036		17,566		5,088,008		104,534		8,890		17,498		130,922		5,218,930
Permanent mortgage		546,846		5,559		4,573		556,978		16,935		3,410		16,678		37,023		594,001
Credit card & other
Credit card		184,014		2,010		1,564		187,588		-		-		-		-		187,588
Other		158,233		937		317		159,487		-		-		1,342		1,342		160,829
Purchased credit-impaired loans		12		-		-		12		-		-		-		-		12
Total credit card & other		342,259		2,947		1,881		347,087		-		-		1,342		1,342		348,429
Total loans, net of unearned	$	15,471,259	$	61,656	$	31,178	$	15,564,093	$	136,142	$	16,283	$	79,191	$	231,616	$	15,795,709

The following table reflects accruing and non-accruing loans by class on June 30, 2013:

	Accruing								Non-Accruing
			30-89		90+						30-89		90+		Total
			Days		Days		Total				Days		Days		Non-		Total
(Dollars in thousands)	Current		Past Due		Past Due		Accruing		Current		Past Due		Past Due		Accruing		Loans
Commercial (C&I):
General C&I	$	6,506,132	$	9,662	$	650	$	6,516,444	$	33,855	$	8,398	$	32,124	$	74,377	$	6,590,821
Loans to mortgage companies		1,386,679		-		-		1,386,679		-		-		343		343		1,387,022
TRUPS (a)		336,043		-		-		336,043		-		-		46,433		46,433		382,476
Purchased credit-impaired loans		7,515		150		83		7,748		-		-		-		-		7,748
Total commercial (C&I)		8,236,369		9,812		733		8,246,914		33,855		8,398		78,900		121,153		8,368,067
Commercial real estate:
Income CRE		1,105,352		4,611		463		1,110,426		4,403		-		18,872		23,275		1,133,701
Residential CRE		33,715		203		-		33,918		748		-		9,359		10,107		44,025
Purchased credit-impaired loans		39,234		1,246		-		40,480		-		-		-		-		40,480
Total commercial real estate		1,178,301		6,060		463		1,184,824		5,151		-		28,231		33,382		1,218,206
Consumer real estate:
HELOC		2,896,298		24,339		15,830		2,936,467		62,663		5,549		11,201		79,413		3,015,880
R/E installment loans		2,471,693		14,671		6,178		2,492,542		28,894		3,361		7,866		40,121		2,532,663
Purchased credit-impaired loans		755		142		-		897		-		-		-		-		897
Total consumer real estate		5,368,746		39,152		22,008		5,429,906		91,557		8,910		19,067		119,534		5,549,440
Permanent mortgage		689,059		12,211		6,529		707,799		15,161		1,421		21,773		38,355		746,154
Credit card & other
Credit card		184,687		1,475		1,216		187,378		-		-		-		-		187,378
Other		126,511		370		98		126,979		1,705		5		-		1,710		128,689
Purchased credit-impaired loans		17		1		-		18		-		-		-		-		18
Total credit card & other		311,215		1,846		1,314		314,375		1,705		5		-		1,710		316,085
Total loans, net of unearned	$	15,783,690	$	69,081	$	31,047	$	15,883,818	$	147,429	$	18,734	$	147,971	$	314,134	$	16,197,952

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. Extensions and modifications to loans are made in accordance with internal policies and guidelines which conform to regulatory guidance. Each occurrence is unique to the borrower and is evaluated separately. FHN considers regulatory guidelines when restructuring loans to ensure that prudent lending practices are followed. As such, qualification criteria and payment terms consider the borrower's current and prospective ability to comply with the modified terms of the loan.

A modification is classified as a TDR if the borrower is experiencing financial difficulty and it is determined that FHN has granted a concession to the borrower. 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. Many aspects of a borrower's financial situation are assessed when determining whether they are experiencing financial difficulty, particularly as it relates to commercial borrowers due to the complex nature of loan structures, business/industry risk, and borrower/guarantor structures. Concessions could include extension of the maturity date, reductions of the interest rate (which may make the rate lower than current market for a new loan with similar risk), reduction of accrued interest, or principal forgiveness. When evaluating whether a concession has been granted, FHN also considers whether the borrower has provided additional collateral or guarantors, among other things, and whether such additions adequately compensate FHN for the restructured terms. The assessments of whether a borrower is experiencing (or is likely to experience) financial difficulty and whether a concession has been granted is subjective in nature and management's judgment is required when determining whether a modification is classified as a TDR.

For all classes within the commercial portfolio segment, TDRs are typically modified through forbearance agreements (generally 6 to 12 months). Forbearance agreements could include reduced interest rates, reduced payments, release of guarantor, or entering into short sale agreements. FHN's proprietary modification programs for consumer loans are generally structured using parameters of U.S. government-sponsored programs such as Home Affordable Modification Program (“HAMP”). Within the HELOC and R/E installment loans classes of the consumer portfolio segment, TDRs are typically modified by reducing the interest rate (in increments of 25 basis points to a minimum of 1 percent for up to 5 years) and a possible maturity date extension to reach an affordable housing debt ratio. Permanent mortgage TDRs are typically modified by reducing the interest rate (in increments of 25 basis points to a minimum of 2 percent for up to 5 years) and a possible maturity date extension to reach an affordable housing debt ratio. After 5 years the interest rate steps up 1 percent every year thereafter until it reaches the Federal Home Loan Mortgage Corporation ("Freddie Mac," "Freddie," or "FHLMC") Weekly Survey Rate cap. Contractual maturities may be extended to 40 years on permanent mortgages and to 30 years for consumer real estate loans. Within the credit card class of the consumer portfolio segment, TDRs are typically modified 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 6 months to 1 year. In the credit card workout program, customers are granted a rate reduction to 0 percent and term extensions for up to 5 years to pay off the remaining balance.

Despite the absence of a loan modification, the discharge of personal liability through bankruptcy proceedings is considered a concession and as a result, FHN classifies all non-reaffirmed residential real estate loans after bankruptcy as nonaccruing TDRs.

On June 30, 2014 and 2013, FHN had $350.9 million and $379.2 million portfolio loans classified as TDRs, respectively. For TDRs in the loan portfolio, FHN had loan loss reserves of $65.8 million and $67.5 million, or 19 percent as of June 30, 2014, and 18 percent as of June 30, 2013. Additionally, $139.5 million and $133.9 million of loans held-for-sale as of June 30, 2014 and 2013, respectively were classified as TDRs.

The following table reflects portfolio loans that were classified as TDRs during the three and six months ended June 30, 2014 and 2013:

		Three Months Ended June 30, 2014					Six Months Ended June 30, 2014
			Pre-Modification		Post-Modification			Pre-Modification		Post-Modification
			Outstanding		Outstanding			Outstanding		Outstanding
(Dollars in thousands)		Number	Recorded Investment		Recorded Investment		Number	Recorded Investment		Recorded Investment
Commercial (C&I):
General C&I		2	$	736	$	522	2	$	736	$	522
	Total commercial (C&I)	2		736		522	2		736		522
Commercial real estate:
Income CRE		2		421		421	2		421		421
Residential CRE		1		976		960	1		976		960
	Total commercial real estate	3		1,397		1,381	3		1,397		1,381
Consumer real estate:
HELOC		97		8,279		8,557	164		14,069		14,325
R/E installment loans		45		3,132		3,093	117		8,275		8,195
	Total consumer real estate	142		11,411		11,650	281		22,344		22,520
Permanent mortgage		12		2,082		2,080	24		6,675		6,167
Credit card & other		14		60		57	34		147		142
Total troubled debt restructurings		173	$	15,686	$	15,690	344	$	31,299	$	30,732

		Three Months Ended June 30, 2013					Six Months Ended June 30, 2013
			Pre-Modification		Post-Modification			Pre-Modification		Post-Modification
			Outstanding		Outstanding			Outstanding		Outstanding
(Dollars in thousands)		Number	Recorded Investment		Recorded Investment		Number	Recorded Investment		Recorded Investment
Commercial (C&I):
General C&I		3	$	14,947	$	14,941	8	$	16,189	$	16,179
	Total commercial (C&I)	3		14,947		14,941	8		16,189		16,179
Commercial real estate:
Income CRE		1		288		288	1		288		288
	Total commercial real estate	1		288		288	1		288		288
Consumer real estate:
HELOC		92		8,758		8,734	207		16,517		16,285
R/E installment loans		97		13,390		13,326	276		19,675		19,559
	Total consumer real estate	189		22,148		22,060	483		36,192		35,844
Permanent mortgage		14		8,306		8,385	26		13,043		13,237
Credit card & other		17		92		89	28		154		148
Total troubled debt restructurings		224	$	45,781	$	45,763	546	$	65,866	$	65,696

The following table presents TDRs which re-defaulted during the three and six months ended June 30, 2014 and 2013, and as to which the modification occurred 12 months or less prior to the re-default. Financing receivables that became classified as TDRs within the previous 12 months and for which there was a payment default during the period are calculated by first identifying TDRs that defaulted during the period and then determining whether they were modified within the 12 months prior to the default. For purposes of this disclosure, FHN generally defines payment default as 30 or more plus days past due.

		Three Months Ended			Six Months Ended
		June 30, 2014			June 30, 2014
			Recorded			Recorded
(Dollars in thousands)		Number	Investment		Number	Investment
Commercial (C&I):
General C&I		-	$	-	4	$	512
	Total commercial (C&I)	-		-	4		512
Commercial real estate:
Income CRE		-		-	2		389
Residential CRE		-		-	-		-
	Total commercial real estate	-		-	2		389
Consumer real estate:
HELOC		2		128	5		339
R/E installment loans		5		305	7		368
	Total consumer real estate	7		433	12		707
Permanent mortgage		2		781	2		781
Credit card & other		2		4	2		4
Total troubled debt restructurings		11	$	1,218	22	$	2,393

		Three Months Ended			Six Months Ended
		June 30, 2013			June 30, 2013
			Recorded			Recorded
(Dollars in thousands)		Number	Investment		Number	Investment
Commercial (C&I):
General C&I		1	$	220	3	$	2,824
	Total commercial (C&I)	1		220	3		2,824
Commercial real estate:
Income CRE		-		-	-		-
Residential CRE		-		-	-		-
	Total commercial real estate	-		-	-		-
Consumer real estate:
HELOC		2		133	9		477
R/E installment loans		-		-	4		129
	Total consumer real estate	2		133	13		606
Permanent mortgage		1		211	10		4,609
Credit card & other		6		26	8		31
Total troubled debt restructurings		10	$	590	34	$	8,070

The determination of whether a TDR is placed on nonaccrual status generally follows the same internal policies and procedures as other portfolio loans. However, FHN will typically place a consumer real estate loan on nonaccrual status if it is 30 or more days delinquent upon modification into a TDR. For commercial loans, nonaccrual TDRs that are reasonably assured of repayment according to their modified terms may be returned to accrual status by FHN upon a detailed credit evaluation of the borrower's financial condition and prospects for repayment under the revised terms. For consumer loans, FHN's evaluation supporting the decision to return a modified loan to accrual status includes consideration of the borrower's sustained historical repayment performance for a reasonable period prior to the date on which the loan is returned to accrual status, which is generally a minimum of six months. FHN may also consider a borrower's sustained historical repayment performance for a reasonable time prior to the restructuring in assessing whether the borrower can meet the restructured terms, as it may indicate that the borrower is capable of servicing the level of debt under the modified terms. Otherwise, FHN will continue to classify restructured loans as nonaccrual. Consistent with regulatory guidance, upon sustained performance and classification as a TDR over FHN's year-end, the loan will be removed from TDR status as long as the modified terms were market-based at the time of modification.