Tennessee’s biggest bank boosted its earnings by 7 percent in the third quarter over a year ago as higher interest rates and an improving economy in Tennessee helped boost both loan volume and interest margins.
First Horizon Corp,. the parent company of First Tennessee Bank, said today it earned $68.9 million, or 28 cents per share, in the three months ended Sept. 30. Earnings, adjusted for non-recurring costs, came to 32 cents per share.
The results beat Wall Street expectations. The average estimate of 10 analysts surveyed by Zacks Investment Research was for earnings of 30 cents per share.
The Memphis-based bank holding company posted revenue of $360.6 million in the period. Its adjusted revenue was $322.2 million, which was below the average consensus of $340.5 million among analysts surveyed by Zacks.
First Tennessee said its net interest income was up 13 percent, driven by average total loan growth of 6 percent and growth in higher-return specialty areas such as loans to mortgage companies and asset-based lending. First Tennessee Bank deposits were up 8 percent and the bank maintained its number one deposit market share position in the state of Tennessee in in metropolitan Chattanooga. Consolidated net interest margin expanded to 3.19 percent from 2.96 percent.
“Our third quarter results were solid with very good balance sheet and revenue growth, as well as our continued focus on controlling costs,” said Bryan Jordan, First Horizon’s chairman and CEO. “Our people did an excellent job of focusing on customers and growing the business while dedicating significant amounts of time to planning the integration of our pending merger with Capital Bank.”
First Horizon announced in March it would buy the Charlotte, N.C.-based Capital Bank Financial Corp for $2.2 billion to boost its presence in the fast-growing U.S. southeast market.
First Horizon shares have dropped 6 percent since the beginning of the year, but the company’s stock has increased 22 percent in the last 12 months.