First Horizon posts second quarter profit as credit quality improves

First Horizon posts second quarter profit

MEMPHIS, Tenn. — First Horizon National Corp. said Friday it returned to profitability in the second quarter, benefiting from improving credit quality.

The Tennessee regional bank said it earned $2.7 million, or a penny per share in the quarter ending in June. In the same period last year the company posted a loss of $27.7 million, or 12 cents per share.

Analysts expected the company to post a loss of 9 cents per share on revenue of $412.9 million.

Revenue rose less than 1 percent to $430.1 million. Net interest income increased slightly even though there were lower outstanding loan balances. Net interest income is the difference between how much it costs a bank to borrow money and how much interest it receives from lending money to customers.

The company said it benefited from its efforts to improve its credit-related costs. It is now focusing primarily on its core regional banking franchise and capital markets business.

The loss provision fell for the fifth straight quarter. It dropped to $70 million from $105 million last quarter. Net charge offs — loans the bank doesn’t think will be repaid — fell 27 percent.

Shares of First Horizon fell 12 cents to $11.99 in afternoon trading Friday amid a broad market slump.