Retirement Plans

6 Months Ended

Jun. 30, 2021

Retirement Benefits, Description [Abstract]

Retirement Plans

Retirement Plans

FHN sponsors a noncontributory, qualified defined benefit pension plan to employees hired or re-hired on or before September 1, 2007. Pension benefits are based on years of service, average compensation near retirement or other termination, and estimated social security benefits at age 65. Benefits under the plan are “frozen” so that years of service and compensation changes after 2012 do not affect the benefit owed. Minimum contributions are based upon actuarially determined amounts necessary to fund the total benefit obligation. Decisions to contribute to the plan are based upon pension funding requirements under the Pension Protection Act, the maximum amount deductible under the Internal Revenue Code, the actual performance of plan assets, and trends in the regulatory environment. FHN made no contributions to the qualified pension plan in 2020. Management does not currently anticipate that FHN will make a contribution to the qualified pension plan during 2021.

FHN also maintains non-qualified plans including a supplemental retirement plan that covers certain employees whose benefits under the qualified pension plan have been limited by tax rules. These other non-qualified plans are unfunded, and contributions to these plans cover all benefits paid under the non-qualified plans. Payments made under the non-qualified plans were $5 million for 2020. FHN anticipates making benefit payments under the non-qualified plans of $5 million in 2021.

Service cost is included in personnel expense in the Consolidated Statements of Income. All other components of net periodic benefit cost are included in other expense.

For more information on FHN's pension plan and other postretirement benefit plans, see Note 18 - Pension, Savings and Other Employee Benefits in FHN's 2020 Annual Report on Form 10-K.

The components of net periodic benefit cost for the three months ended June 30 were as follows:

(Dollars in millions)	2021		2020
Components of net periodic benefit cost
Interest cost	$	4	$	6
Expected return on plan assets	(4)		(6)
Amortization of unrecognized:
Actuarial (gain) loss	2		3
Net periodic benefit cost	$	2	$	3

The components of net periodic benefit cost for the six months ended June 30 were as follows:

(Dollars in millions)	2021		2020
Components of net periodic benefit cost
Interest cost	$	8	$	12
Expected return on plan assets	(8)		(12)
Amortization of unrecognized:
Actuarial (gain) loss	4		6
Other	2		—
Net periodic benefit cost	$	6	$	6