XML 35 R12.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Investment Securities
 12 Months Ended
Dec. 31, 2019
Marketable Securities [Abstract]  
Investment Securities Investment Securities
The following tables summarize FHN’s investment securities on December 31, 2019 and 2018:
 
 
December 31, 2019
(Dollars in thousands)
 
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
Securities available-for-sale:
 
 
 
 
 
 
 
 
U.S. treasuries
 
$
100

 
$
—

 
$
—

 
$
100

Government agency issued mortgage-backed securities (“MBS”)
 
2,316,381

 
34,692

 
(2,556
)
 
2,348,517

Government agency issued collateralized mortgage obligations (“CMO”)
 
1,667,773

 
9,916

 
(7,197
)
 
1,670,492

Other U.S. government agencies
 
303,463

 
3,750

 
(1,121
)
 
306,092

Corporates and other debt
 
40,054

 
486

 
—

 
40,540

State and municipalities
 
57,232

 
3,324

 
(30
)
 
60,526

 
 
$
4,385,003

 
$
52,168

 
$
(10,904
)
 
4,426,267

AFS securities recorded at fair value through earnings:
 
 
 
 
 
 
 
 
SBA-interest only strips (a)
 
 
 
 
 
 
 
19,136

Total securities available-for-sale (b)
 
 
 
 
 
 
 
$
4,445,403

Securities held-to-maturity:
 
 
 
 
 
 
 
 
Corporates and other debt
 
$
10,000

 
$
1

 
$
—

 
$
10,001

Total securities held-to-maturity
 
$
10,000

 
$
1

 
$
—

 
$
10,001


(a)
SBA-interest only strips are recorded at elected fair value. See Note 24 - Fair Value of Assets and Liabilities for additional information.
(b)
Includes $3.8 billion of securities pledged to secure public deposits, securities sold under agreements to repurchase, and for other purposes.

 
 
December 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 MBS
 
2,473,687

 
4,819

 
(58,400
)
 
2,420,106

Government agency issued CMO
 
2,006,488

 
888

 
(48,681
)
 
1,958,695

Other U.S. government agencies
 
149,050

 
809

 
(73
)
 
149,786

Corporates and other debt
 
55,383

 
388

 
(461
)
 
55,310

State and municipalities
 
32,473

 
314

 
(214
)
 
32,573

 
 
$
4,717,181

 
$
7,218

 
$
(107,831
)
 
4,616,568

AFS securities recorded at fair value through earnings:
 
 
 
 
 
 
 
 
SBA-interest only strips (a)
 
 
 
 
 
 
 
9,902

Total securities available-for-sale (b)
 
 
 
 
 
 
 
$
4,626,470

Securities held-to-maturity:
 
 
 
 
 
 
 
 
Corporates and other debt
 
$
10,000

 
$
—

 
$
(157
)
 
$
9,843

Total securities held-to-maturity
 
$
10,000

 
$
—

 
$
(157
)
 
$
9,843


(a)
SBA-interest only strips are recorded at elected fair value. See Note 24 - Fair Value of Assets and Liabilities for additional information.
(b)
Includes $3.8 billion of securities pledged to secure public deposits, securities sold under agreements to repurchase, and for other purposes.



The amortized cost and fair value by contractual maturity for the available-for-sale and held-to-maturity debt securities portfolios on December 31, 2019 are provided below:
 
 
 
Held-to-Maturity
 
Available-for-Sale
(Dollars in thousands)
 
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
Within 1 year
 
$
—

 
$
—

 
$
35,022

 
$
35,211

After 1 year; within 5 years
 
—

 
—

 
209,003

 
213,108

After 5 years; within 10 years
 
10,000

 
10,001

 
755

 
3,332

After 10 years
 
—

 
—

 
156,069

 
174,743

Subtotal
 
10,000

 
10,001

 
400,849

 
426,394

Government agency issued MBS and CMO (a)
 
—

 
—

 
3,984,154

 
4,019,009

Total
 
$
10,000

 
$
10,001

 
$
4,385,003

 
$
4,445,403

 
(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.
The table below provides information on gross gains and gross losses from debt investment securities for the years ended December 31: Equity securities are included in 2017.
 
 
 
Available-for-Sale
(Dollars in thousands)
 
2019
 
2018
 
2017
Gross gains on sales of securities
 
$
—

 
$
52

 
$
2,514

Gross (losses) on sales of securities
 
(267
)
 
—

 
(1,922
)
Net gain/(loss) on sales of securities (a) (b)
 
(267
)
 
52

 
592

 
(a)
Cash proceeds from the sale of available-for-sale securities during 2019 were $191.7 million and were not material in 2018. Cash proceeds from sales during 2017 were $937.0 million.
(b)
2017 includes a $.4 million gain associated with the call of a $4.4 million held-to-maturity municipal bond.













The following tables provide information on investments within the available-for-sale portfolio that had unrealized losses as of December 31, 2019 and 2018:
 
 
 
As of December 31, 2019
 
 
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
 
$
—

 
$
—

 
$
100

 
$
—

 
$
100

 
$
—

Government agency issued MBS
 
174,983

 
(495
)
 
192,755

 
(2,061
)
 
367,738

 
(2,556
)
Government agency issued CMO
 
378,815

 
(1,970
)
 
361,124

 
(5,227
)
 
739,939

 
(7,197
)
Other U.S. government agencies
 
98,471

 
(1,121
)
 
—

 
—

 
98,471

 
(1,121
)
States and municipalities
 
3,551

 
(30
)
 
—

 
—

 
3,551

 
(30
)
Total temporarily impaired securities
 
$
655,820

 
$
(3,616
)
 
$
553,979

 
$
(7,288
)
 
$
1,209,799

 
$
(10,904
)
 
 
 
As of December 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
 
597,008

 
(12,335
)
 
1,537,106

 
(46,065
)
 
2,134,114

 
(58,400
)
Government agency issued CMO
 
290,863

 
(2,860
)
 
1,560,420

 
(45,821
)
 
1,851,283

 
(48,681
)
Other U.S. government agencies
 
29,776

 
(73
)
 
—

 
—

 
29,776

 
(73
)
Corporates and other debt
 
25,114

 
(344
)
 
15,008

 
(117
)
 
40,122

 
(461
)
States and municipalities
 
17,292

 
(214
)
 
—

 
—

 
17,292

 
(214
)
Total temporarily impaired securities
 
$
960,053

—

$
(15,826
)
—

$
3,112,632

—

$
(92,005
)
 
$
4,072,685

 
$
(107,831
)

FHN has reviewed debt investment securities that were in unrealized loss positions in accordance with its accounting policy for OTTI and does not consider them other-than-temporarily impaired. For debt securities with unrealized losses, FHN does not intend to sell them and it is more-likely-than-not that FHN will not be required to sell them prior to recovery. The decline in value is primarily attributable to changes in interest rates and not credit losses.
The carrying amount of equity investments without a readily determinable fair value was $25.6 million and $21.3 million at December 31, 2019 and 2018, respectively. The year-to-date 2019 and 2018 gross amounts of upward and downward valuation adjustments were not significant.
Unrealized gains of $7.0 million and unrealized losses of $1.5 million were recognized during 2019 and 2018, respectively, for equity investments with readily determinable fair values.
In 2018 FHN sold its remaining holdings of Visa Class B Shares resulting in a pre-tax gain of $212.9 million recognized within the Corporate segment. See the Other Derivatives section of Note 22 - Derivatives for more information regarding FHN’s Visa shares.