The parent company of First Tennessee Bank nearly tripled its net income last year by cutting expenses 12 percent and boosting revenues 9 percent.
But Tennessee's biggest bank holding company still fell short of Wall Street analysts expectations in the fourth quarter.
First Horizon National Corp., the Memphis-based bank holding company that owns Chattanooga's biggest bank, reported net income Friday of $227 million, or 94 cents per share, for all of last year. In 2015, First Horizon reported net income of earned $85.9 million, or 34 cents per share. Revenue last year totaled $1.28 billion.
In the fourth quarter, First Horizon reported a profit of $54.8 million, or 23 cents per share. The results did not meet Wall Street expectations. The average estimate of nine analysts surveyed by Zacks Investment Research was for earnings of 25 cents per share for the fourth quarter.
First Horizon Bryan Jordan said the earnings gains reflect the bank staying "focused on the right things: supporting our customers, growing our business, making the best use of our strong capital position, managing the impact of interest rates and improving our operating leverage by investing in ways that drive business,"
"We made meaningful progress toward each of our bonefish targets, and that momentum is positioning this company for long-term success," Jordan said.
First Tennessee, the largest bank in Chattanooga with more than $2 billion in local deposits, achieved double-digit gains in income, deposits and loans last year in the Chattanooga market.
"During the last quarter of 2016, we grew profits by 23 percent, commercial loans by 13 percent and commercial deposits by 14 percent," said Jeff Jackson, market president for First Tennessee Bank in Chattanooga.
Banks have struggled to grow profits in the past several years due to record low interest rates, but rising rates are beginning to boost bank profits.
Bank of America said Friday its fourth-quarter profit jumped 47 percent from a year ago as the nation's largest consumer bank benefited from higher interest rates and lower expenses.
The Charlotte, North Carolina-based bank said it earned a profit of $4.34 billion after payments to preferred shareholders, or 40 cents per share, up from $2.95 billion, or 27 cents a share, in the same period a year earlier. The results topped analysts' expectations, who were looking for 38 cents per share, according to FactSet.
"While the recent rise in interest rates came too late to impact fourth-quarter results, we expect to see a significant increase in net interest income in the first quarter of 2017," Paul Donofrio, BofA's chief financial officer, said in a statement.
While most banks are expected to boost earnings in the fourth quarter, Wells Fargo Bank continues to struggle with the fallout from a phony account scandal that engulfed it last year.
The bank said Friday that new credit card applications were down 43 percent in the fourth quarter of 2016 from a year ago, and that new checking account openings fell 40 percent. The results reflected the first full quarter since September, when Wells, which is based in San Francisco, announced that its employees had, over the course of years, created as many as 2 million unauthorized credit card and checking accounts.
Wells has vowed to upend its aggressive sales culture, doing away with sales goals in the retail banks and backing down from its cross-selling strategy of pushing multiple products on a single customer.
The fourth quarter reflected a broad slowdown in branch activity: Teller transactions fell 6 percent from a year ago, while customers interactions with the bankers in the branches declined 14 percent.
Yet even as its retail business showed some signs of trouble, Wells Fargo managed to increase its deposits in the quarter. And spending on its credit and debit cards also rose from a year ago.
Wells reported a larger than expected loss in the quarter, with profit falling 4.3 percent to $21.9 billion.