Investment Securities (Tables)

3 Months Ended

Mar. 31, 2018

The following tables summarize FHN’s investment securities on March 31, 2018 and December 31, 2017:



	March 31, 2018
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Securities available-for-sale:
U.S. treasuries	$	100	$	—	$	(2	)	$	98
Government agency issued mortgage-backed securities (“MBS”)	2,585,250		6,384		(60,772		)	2,530,862
Government agency issued collateralized mortgage obligations (“CMO”)	2,266,776		984		(61,419		)	2,206,341
Other U.S. government agencies	29,822		—		(199		)	29,623
Corporates and other debt	55,716		587		(315		)	55,988
States and municipalities	512		—		(2		)	510
	$	4,938,176	$	7,955	$	(122,709	)	4,823,422
AFS debt securities recorded at fair value through earnings:
SBA-interest only strips (a)								2,733
Total securities available-for-sale (b)								$	4,826,155
Securities held-to-maturity:
Corporates and other debt	$	10,000	$	—	$	(183	)	$	9,817
Total securities held-to-maturity	$	10,000	$	—	$	(183	)	$	9,817


(a)	SBA-interest only strips are recorded at elected fair value. See Note 16 - Fair Value for additional information.


(b)	Includes $4.1 billion of securities pledged to secure public deposits, securities sold under agreements to repurchase, and for other purposes.



	December 31, 2017
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Securities available-for-sale:
U.S. treasuries	$	100	$	—	$	(1	)	$	99
Government agency issued MBS	2,580,442		10,538		(13,604		)	2,577,376
Government agency issued CMO	2,302,439		1,691		(34,272		)	2,269,858
Corporates and other debt	55,799		23		(40		)	55,782
Equity and other (a)	265,863		7		—			265,870
	$	5,204,643	$	12,259	$	(47,917	)	5,168,985
AFS debt securities recorded at fair value through earnings:
SBA-interest only strips (b)								1,270
Total securities available-for-sale (c)								$	5,170,255
Securities held-to-maturity:
Corporates and other debt	$	10,000	$	—	$	(99	)	$	9,901
Total securities held-to-maturity	$	10,000	$	—	$	(99	)	$	9,901


(a)	Includes restricted investments in FHLB-Cincinnati stock of $87.9 million and FRB stock of $134.6 million. The remainder is money market, mutual funds, and cost method investments. Equity investments were reclassified to Other assets upon adoption of ASU 2016-01 on January 1, 2018.


(b)	SBA-interest only strips are recorded at elected fair value. See Note 16 - Fair Value of Assets and Liabilities for additional information.


(c)	Includes $4.0 billion of securities pledged to secure public deposits, securities sold under agreements to repurchase, and for other purposes.

Schedule of Amortized Cost And Fair Value By Contractual Maturity

The amortized cost and fair value by contractual maturity for the available-for-sale and held-to-maturity debt securities portfolios on March 31, 2018 are provided below:



	Held-to-Maturity				Available-for-Sale
(Dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Within 1 year	$	—	$	—	$	—	$	—
After 1 year; within 5 years	—		—		85,638		85,733
After 5 years; within 10 years	10,000		9,817		512		1,897
After 10 years	—		—		—		1,322
Subtotal	10,000		9,817		86,150		88,952
Government agency issued MBS and CMO (a)	—		—		4,852,026		4,737,203
Total	$	10,000	$	9,817	$	4,938,176	$	4,826,155


(a)	Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Schedule of Gross Gains And Losses On Sale From Available For Sale Portfolio

The table below provides information on gross gains and gross losses from debt investment securities for the three months ended March 31, 2018. Equity securities are included for periods prior to 2018.



	Three Months Ended March 31
(Dollars in thousands)	2018		2017
Gross gains on sales of securities	$	52	$	44
Gross (losses) on sales of securities	—		—
Net gain/(loss) on sales of securities (a)	$	52	$	44


(a)	Cash proceeds for the three months ended March 31, 2018 and 2017 were not material.

Schedule of Investments Within The Available For Sale Portfolio That Had Unrealized Losses

The following tables provide information on investments within the available-for-sale portfolio that had unrealized losses as of March 31, 2018 and December 31, 2017:



	As of March 31, 2018
	Less than 12 months					12 months or longer					Total
(Dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
U.S. treasuries	$	98	$	(2	)	$	—	$	—		$	98	$	(2	)
Government agency issued MBS	1,976,042		(46,036		)	321,350		(14,736		)	2,297,392		(60,772		)
Government agency issued CMO	1,303,393		(23,774		)	788,798		(37,645		)	2,092,191		(61,419		)
Other U.S. government agencies	29,623		(199		)	—		—			29,623		(199		)
Corporates and other debt	40,658		(315		)	—		—			40,658		(315		)
States and municipalities	510		(2		)	—		—			510		(2		)
Total temporarily impaired securities	$	3,350,324	$	(70,328	)	$	1,110,148	$	(52,381	)	$	4,460,472	$	(122,709	)



	As of December 31, 2017
	Less than 12 months					12 months or longer					Total
(Dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
U.S. treasuries	$	99	$	(1	)	$	—	$	—		$	99	$	(1	)
Government agency issued MBS	1,455,476		(4,738		)	331,900		(8,866		)	1,787,376		(13,604		)
Government agency issued CMO	1,043,987		(7,464		)	832,173		(26,808		)	1,876,160		(34,272		)
Corporates and other debt	15,294		(40		)	—		—			15,294		(40		)
Total temporarily impaired securities	$	2,514,856	$	(12,243	)	$	1,164,073	$	(35,674	)	$	3,678,929	$	(47,917	)