The following table provides the balance of loans by portfolio segment as of June 30, 2013 and 2012, and December 31, 2012:

		June 30				December 31
(Dollars in thousands)		2013		2012		2012
Commercial:
	Commercial, financial, and industrial	$	8,367,161	$	7,981,365	$	8,796,956
	Commercial real estate
	Income CRE		1,171,901		1,224,944		1,109,930
	Residential CRE		46,305		89,225		58,305
Retail:
	Consumer real estate (a)		5,549,440		5,855,564		5,688,703
	Permanent mortgage (b)		746,154		755,707		765,583
	Credit card & other		316,085		278,958		289,105
Loans, net of unearned income		$	16,197,046	$	16,185,763	$	16,708,582
Allowance for loan losses			261,934		321,051		276,963
Total net loans		$	15,935,112	$	15,864,712	$	16,431,619

For purposes of this disclosure, the loan portfolio was disaggregated into segments and then further disaggregated into classes for certain disclosures. A portfolio segment is defined as the level at which an entity develops and documents a systematic method for determining its allowance for credit losses. A class is generally determined based on the initial measurement attribute (i.e., amortized cost or purchased credit impaired), risk characteristics of the loan, and an entity's method for monitoring and assessing credit risk. Commercial loan portfolio segments include commercial, financial, and industrial (“C&I”) and commercial real estate (“CRE”). Commercial classes within C&I include general C&I, loans to mortgage companies, the trust preferred loans (“TRUPs”)(i.e., loans to bank and insurance-related businesses) portfolio and purchase credit impaired ("PCI") loans. Loans to mortgage companies includes commercial lines of credit to qualified mortgage companies exclusively for the temporary warehousing of eligible mortgage loans prior to the borrower's sale of those mortgage loans to third party investors. Commercial classes within commercial real estate include income CRE, residential CRE and PCI loans. Retail loan portfolio segments include consumer real estate, permanent mortgage, and the credit card and other portfolio. Retail classes include HELOC, real estate (“R/E”) installment and PCI loans within the consumer real estate segment, permanent mortgage (which is both a segment and a class), and credit card and other.

On June 7, 2013, FHN acquired substantially all of the assets and liabilities of MNB from the FDIC. The acquisition included approximately $249 million of loans. These loans are recorded at fair value which incorporates expected credit losses in accordance with Accounting Standards Codification Topic related to Business Combinations (“ASC 805”) resulting in no carryover of allowance for loan loss from the acquiree. See Note 2 - Acquisitions and Divestitures for additional information regarding the acquisition. At acquisition, FHN designated certain loans as purchase credit impaired (see discussion below) with the remaining loans accounted for under ASC 310-20, Nonrefundable Fees and Other Costs. For loans accounted for under ASC 310-20, the difference between the loans' book value to MNB and the estimated fair value at the time of the acquisition will be accreted back into interest income over the remaining contractual life and the subsequent accounting and reporting will be similar to FHN's originated loan portfolio.

Accounting Standards Codification Topic related to Accounting for Certain Loans or Debt Securities Acquired in a Transfer ("ASC 310-30"), provides guidance for acquired loans that have experienced deterioration of credit quality at the time of acquisition and for which the timely collection of the interest and principal is no longer reasonably assured ("PCI loans"). PCI loans are initially recorded at fair value which was estimated by discounting expected cash flows at acquisition date. The expected cash flows includes all contractually expected amounts (including interest) and incorporates an estimate for future expected credit losses, pre-payment assumptions, and yield requirement for a market participant, among other things.

Accretable yield is the excess of cash flows expected at acquisition over the initial investment in the loan and is recognized in interest income over the remaining life of the loan, or pool of loans. Nonaccretable difference is the difference between the contractually required payments at acquisition and the cash flows expected to be collected at acquisition. In quarters subsequent to the acquisition date, FHN will re-estimate expected cash flows for PCI loans. Increases in expected cash flows from the last measurement will result in reversal of any nonaccretable difference (or allowance for loan losses to the extent any has been recorded) with a prospective positive impact on interest income. Decreases to the expected cash flows will result in an increase in the allowance for loan losses through increased provision expense. Generally, PCI loans will not be reported as nonperforming loans, troubled debt restructurings (if pooled), or impaired loans unless there has been an other-than-temporary decline in the fair value of a loan below amortized cost or if it is probable that a loan has become impaired in periods subsequent to the acquisition.

The following table reflects the contractually required payments receivable, cash flows expected to be collected, and the fair value of purchase credit impaired loans at the acquisition date of June 7, 2013.

Given the short period of time from acquisition date through June 30, 2013, estimated cash flows were not revised at period-end and consequently, there were no additions to the allowance for loan losses or adjustments to the nonaccretable difference or accretable yield. The following table reflects the outstanding principal balance and carrying amounts of the acquired PCI loans as of June 30, 2013:

	June 30, 2013
(Dollars in thousands)	Ending balance		Unpaid balance
Commercial, financial and industrial	$	3,586	$	4,312
Commercial real estate		37,347		56,375
Consumer real estate		682		958
Credit card and other		18		26
Total	$	41,633	$	61,671

FHN has a concentration of loans secured by residential real estate (39 percent of total loans), the majority of which is in the consumer real estate portfolio (34 percent of total loans). Loans to finance and insurance companies total $1.6 billion (19 percent of the C&I portfolio, or 10 percent of the total loans). FHN had loans to mortgage companies totaling $1.4 billion (16 percent of the C&I portfolio, or 9 percent of total loans) as of June 30, 2013. As a result, 35 percent of the C&I category was sensitive to impacts on the financial services industry.

In first quarter 2012, the Office of the Comptroller of Currency ("OCC") issued interagency guidance related to ALLL estimation and nonaccrual practices, and risk management policies for junior lien loans. As a result, FHN modified its nonaccrual policies in first quarter 2012, to place current second liens on nonaccrual if the first lien is owned or serviced by FHN and is 90 or more days past due. For non FHN-serviced first liens, in second quarter 2013, FHN received information from a third party vendor regarding the performance status of those first liens and placed stand-alone second liens on nonaccrual if the first lien was 90 days or more past due or had been modified. As a result of this new information, additions to nonperforming loans for the quarter ended June 30, 2013, were approximately $56 million and were largely concentrated in the consumer real estate portfolio. Because probable incurred losses had been contemplated in the allowance for loan loss estimate in prior quarters, this new information did not result in a significant increase in the ALLL in second quarter 2013.

In third quarter 2012, the OCC clarified that residential real estate loans in which personal liability has been discharged through Chapter 7 bankruptcy and not reaffirmed by the borrower are collateral dependent and should be reported as nonaccruing troubled debt restructuring ("TDR"). As a result, FHN charged-down such loans to the net realizable value of the collateral and the remaining balances were reported as nonaccruing TDRs regardless of the loan's delinquency status.

Because of the composition of FHN's residential real estate portfolios, these changes most significantly impacted the consumer real estate portfolio segment. The level of nonperforming loans and TDRs in the consumer real estate and permanent mortgage portfolios was affected by the regulatory actions discussed above.

The ALLL includes the following components: reserves for commercial loans evaluated based on pools of credit graded loans and reserves for pools of smaller-balance homogeneous retail loans, both determined in accordance with ASC 450-20-50. The reserve factors applied to these pools are an estimate of probable incurred losses based on management's evaluation of historical net losses from loans with similar characteristics and are subject to qualitative adjustments by management to reflect current events, trends, and conditions (including economic considerations and trends). The slow economic recovery, performance of the housing market, unemployment levels, the regulatory environment and recent guidance, and both positive and negative portfolio segment-specific trends, are examples of additional factors considered by management in determining the ALLL. The ALLL also includes reserves determined in accordance with ASC 310-10-35 for loans determined by management to be individually impaired.

For commercial loans, reserves are established using historical net loss factors by grade level, loan product, and business segment. An assessment of the quality of individual commercial loans is made utilizing credit grades assigned internally based on a dual grading system which estimates both the probability of default (“PD”) and loss severity in the event of default. PD grades range from 1-16 while estimated loss severities, or loss given default (“LGD”) grades, range from 1-12. This credit grading system is intended to identify and measure the credit quality of the loan portfolio by analyzing the migration of loans between grading categories. It is also integral to the estimation methodology utilized in determining the allowance for loan losses since an allowance is established for pools of commercial loans based on the credit grade assigned. The appropriate relationship team performs the process of categorizing commercial loans into the appropriate credit grades, initially as a component of the approval of the loan, and subsequently throughout the life of the loan as part of the servicing regimen. The proper loan grade for larger exposures is confirmed by a senior credit officer in the approval process. To determine the most appropriate credit grade for each loan, the credit risk grading system employs scorecards for particular categories of loans that consist of a number of objective and subjective measures that are weighted in a manner that produces a rank ordering of risk within pass-graded credits. Loan grading discipline is regularly reviewed by Credit Risk Assurance to determine if the process continues to result in accurate loan grading across the portfolio. FHN may utilize availability of guarantors/sponsors to support lending decisions during the credit underwriting process and when determining the assignment of internal loan grades.

The ALLL for smaller-balance homogenous retail loans is determined based on pools of similar loan types that have similar credit risk characteristics. FHN manages retail loan credit risk on a class basis. Reserves by portfolio are determined using segmented roll-rate models that incorporate various factors including historical delinquency trends, experienced loss frequencies, and experienced loss severities. Generally, reserves for retail loans reflect inherent losses in the portfolio that are expected to be recognized over the following twelve months.

Generally, classified nonaccrual commercial loans over $1 million and all commercial and consumer loans classified as TDRs are deemed to be impaired and are individually assessed for impairment measurement in accordance with ASC 310-10-35. Generally, PCI loans are not considered impaired loans unless there are declines in fair value in reporting periods subsequent to the acquisition date. For all commercial portfolio segments, commercial TDRs and other individually impaired commercial loans are measured based on the present value of expected future payments discounted at the loan's effective interest rate (“the DCF method”), observable market prices, or for loans that are solely dependent on the collateral for repayment, the net realizable value. For loans measured using the DCF method or by observable market prices, if the recorded investment in the impaired loan exceeds this amount, a specific allowance is established as a component of the ALLL until such time as a loss is expected and recognized; for impaired collateral-dependent loans, FHN will charge off the full difference between the book value and the best estimate of net realizable value.

Generally, the allowance for TDRs in all consumer portfolio segments is determined by estimating the expected future cash flows using the modified interest rate (if an interest rate concession), incorporating payoff and net charge-off rates specific to the TDRs within the portfolio segment being assessed, and discounted using the pre-modification interest rate. The discount rates of variable rate TDRs are adjusted to reflect changes in the interest rate index in which the rates are tied. The discounted cash flows are then compared to the outstanding principal balance in order to determine required reserves. Residential real estate loans discharged through bankruptcy are collateral-dependent and are charged down to net realizable value.

The following table provides a rollforward of the allowance for loan losses by portfolio segment for the three and six months ended June 30, 2013 and 2012:
				Commercial		Consumer		Permanent		Credit Card
(Dollars in thousands)		C&I		Real Estate		Real Estate		Mortgage		and Other			Total
Balance as of April 1, 2012		$	119,578	$	46,049	$	141,647	$	32,572	$	6,170	$	346,016
Charge-offs			(10,159)		(4,002)		(29,136)		(3,071)		(3,360)		(49,728)
Recoveries			2,162		1,043		5,175		648		735		9,763
Provision			(936)		(1,544)		15,735		(1,037)		2,782		15,000
Balance as of June 30, 2012			110,645		41,546		133,421		29,112		6,327		321,051
Balance as of January 1, 2012			130,413		55,586		165,077		26,194		7,081		384,351
Charge-offs			(16,233)		(13,621)		(63,269)		(7,709)		(5,979)		(106,811)
Recoveries			6,676		1,539		9,314		1,171		1,811		20,511
Provision			(10,211)		(1,958)		22,299		9,456		3,414		23,000
Balance as of June 30, 2012			110,645		41,546		133,421		29,112		6,327		321,051
Allowance - individually evaluated for impairment			31,458		7,707		32,688		24,131		221		96,205
Allowance - collectively evaluated for impairment			79,187		33,839		100,733		4,981		6,106		224,846
Loans, net of unearned as of June 30, 2012:
	Individually evaluated for impairment		155,863		92,645		125,040		119,537		933		494,018
	Collectively evaluated for impairment		7,825,502		1,221,524		5,730,524		636,170		278,025		15,691,745
Total loans, net of unearned			7,981,365		1,314,169		5,855,564		755,707		278,958		16,185,763
Balance as of April 1, 2013			86,105		15,138		131,417		25,448		7,110		265,218
Charge-offs			(6,896)		(716)		(18,384)		(1,824)		(2,452)		(30,272)
Recoveries			4,101		1,470		5,030		624		763		11,988
Provision			10,192		(1,961)		2,785		2,855		1,129		15,000
Balance as of June 30, 2013			93,502		13,931		120,848		27,103		6,550		261,934
Balance as of January 1, 2013			96,191		19,997		128,949		24,928		6,898		276,963
Charge-offs			(11,332)		(2,097)		(42,380)		(5,211)		(5,352)		(66,372)
Recoveries			6,597		2,116		10,534		768		1,328		21,343
Provision			2,046		(6,085)		23,745		6,618		3,676		30,000
Balance as of June 30, 2013			93,502		13,931		120,848		27,103		6,550		261,934
Allowance - individually evaluated for impairment			16,201		552		42,393		22,725		240		82,111
Allowance - collectively evaluated for impairment			77,301		13,379		78,455		4,378		6,310		179,823
Loans, net of unearned as of June 30, 2013:
	Individually evaluated for impairment		118,081		40,856		178,198		139,665		717		477,517
	Collectively evaluated for impairment		8,245,494		1,140,003		5,370,560		606,489		315,350		15,677,896
	Purchased credit impaired loans		3,586		37,347		682		-		18		41,633
Total loans, net of unearned		$	8,367,161	$	1,218,206	$	5,549,440	$	746,154	$	316,085	$	16,197,046

Impaired Loans

The following tables provide information at June 30, 2013 and 2012, by class related to individually impaired loans and consumer TDR's. Recorded investment is defined as the amount of the investment in a loan, before valuation allowance but which does reflect any direct write-down of the investment. For purposes of this disclosure, PCI loans and LOCOM have been excluded.

								Three Months Ended				Six Months Ended
		June 30, 2013						June 30, 2013				June 30, 2013
				Unpaid				Average		Interest		Average		Interest
		Recorded		Principal		Related		Recorded		Income		Recorded		Income
(Dollars in thousands)		Investment		Balance		Allowance		Investment		Recognized		Investment		Recognized
Impaired loans with no related allowance recorded:
Commercial:
	General C&I	$	47,432	$	55,225	$	-	$	54,140	$	28	$	53,873	$	108
	TRUPs		6,500		6,500		-		8,250		-		15,250		-
	Income CRE		22,978		33,744		-		25,557		93		28,389		168
	Residential CRE		10,967		15,997		-		12,630		59		12,803		122
	Total	$	87,877	$	111,466	$	0	$	100,577	$	180	$	110,315	$	398
Retail:
	HELOC (a)	$	19,709	$	37,715	$	-	$	20,383	$	-	$	20,023	$	-
	R/E installment loans (a)		12,193		14,150		-		12,761		-		11,258		-
	Permanent mortgage		14,796		14,796		-		14,715		-		13,206		-
	Total	$	46,698	$	66,661	$	0	$	47,859	$	-	$	44,487	$	-
Impaired loans with related allowance recorded:
Commercial:
	General C&I	$	24,216	$	30,555	$	2,434	$	13,985	$	37	$	17,258	$	37
	TRUPs		43,700		43,700		13,768		41,950		-		38,700		-
	Income CRE		4,830		6,129		441		2,950		15		2,954		26
	Residential CRE		2,081		3,944		111		1,041		16		521		16
	Total	$	74,827	$	84,328	$	16,754	$	59,926	$	68	$	59,433	$	79
Retail:
	HELOC	$	67,672	$	67,672	$	18,122	$	65,369	$	464	$	63,661	$	890
	R/E installment loans		78,624		78,624		24,271		73,549		404		74,157		689
	Permanent mortgage		124,869		124,869		22,725		123,332		705		124,280		1,388
	Credit card & other		717		717		240		732		8		767		16
	Total	$	271,882	$	271,882	$	65,358	$	262,982	$	1,581	$	262,865	$	2,983
Total commercial		$	162,704	$	195,794	$	16,754	$	160,503	$	248	$	169,748	$	477
Total retail		$	318,580	$	338,543	$	65,358	$	310,841	$	1,581	$	307,352	$	2,983
Total impaired loans		$	481,284	$	534,337	$	82,112	$	471,344	$	1,829	$	477,100	$	3,460

								Three Months Ended				Six Months Ended
		June 30, 2012						June 30, 2012				June 30, 2012
				Unpaid				Average		Interest		Average		Interest
		Recorded		Principal		Related		Recorded		Income		Recorded		Income
(Dollars in thousands)		Investment		Balance		Allowance		Investment		Recognized		Investment		Recognized
Impaired loans with no related allowance recorded:
Commercial:
	General C&I	$	62,122	$	81,423	$	-	$	62,858	$	204	$	68,551	$	407
	TRUPs		47,000		47,000		-		47,000		-		47,000		-
	Income CRE		51,375		92,153		-		57,783		76		59,514		153
	Residential CRE		22,341		39,993		-		23,276		62		23,316		134
	Total	$	182,838	$	260,569	$	-	$	190,917	$	342	$	198,381	$	694
Impaired loans with related allowance recorded:
Commercial:
	General C&I	$	18,948	$	18,948	$	7,629	$	15,889	$	33	$	16,696	$	67
	TRUPs		33,700		33,700		23,829		33,700		-		33,700		-
	Income CRE		1,529		1,577		189		1,869		14		1,876		29
	Residential CRE		17,400		17,400		7,518		18,457		-		19,276		-
	Total	$	71,577	$	71,625	$	39,165	$	69,915	$	47	$	71,548	$	96
Retail:
	HELOC	$	57,175	$	57,175	$	13,903	$	54,793	$	411	$	53,547	$	784
	R/E installment loans		67,865		67,865		18,785		66,505		276		69,036		541
	Permanent mortgage		119,537		119,537		24,131		110,785		734		96,300		1,390
	Credit card & other		933		933		221		980		10		1,025		21
	Total	$	245,510	$	245,510	$	57,040	$	233,063	$	1,431	$	219,908	$	2,736
Total commercial		$	254,415	$	332,194	$	39,165	$	260,832	$	389	$	269,929	$	790
Total retail		$	245,510	$	245,510	$	57,040	$	233,063	$	1,431	$	219,908	$	2,736
Total impaired loans		$	499,925	$	577,704	$	96,205	$	493,895	$	1,820	$	489,837	$	3,526

As previously discussed, FHN employs a dual grade commercial risk grading methodology to assign an estimate for PD and the LGD for each commercial loan using factors specific to various industry, portfolio, or product segments that result in a rank ordering of risk and the assignment of grades PD 1 to PD 16. Each PD grade corresponds to an estimated one-year default probability percentage; a PD 1 has the lowest expected default probability, and probabilities increase as grades progress down the scale. PD 1 through PD 12 are “pass” grades. PD grades 13-16 correspond to the regulatory-defined categories of special mention (13), substandard (14), doubtful (15), and loss (16). Pass loan grades are required to be reassessed annually or earlier whenever there has been a material change in the financial condition of the borrower or risk characteristics of the relationship. All commercial loans over $1 million and certain commercial loans over $500,000 that are graded 13 or worse are reassessed on a quarterly basis. LGD grades are assigned based on a scale of 1-12 and represent FHN's expected recovery based on collateral type in the event a loan defaults.

The following tables provide the balances of commercial loan portfolio classes with associated allowance, disaggregated by PD grade as of June 30, 2013 and 2012:
	June 30, 2013
			Loans to													Allowance
	General		Mortgage				Income		Residential					Percentage		for Loan
(Dollars in thousands)	C&I		Companies		TRUPS (a)		CRE		CRE		Total			of Total		Losses
PD Grade:
1	$	227,858	$	-	$	-	$	-	$	-	$	227,858		2	%	$	75
2		176,086		-		-		1,809		116		178,011		2			73
3		186,420		-		-		5,520		-		191,940		2			207
4		295,896		-		-		7,763		321		303,980		3			455
5		658,296		-		-		33,783		128		692,207		7			1,321
6		989,615		141,660		-		175,144		10,288		1,316,707		14			2,812
7		1,023,498		379,727		-		218,459		2,292		1,623,976		17			3,469
8		956,367		532,802		-		222,598		4,837		1,716,604		19			5,677
9		665,510		286,958		-		127,895		1,134		1,081,497		11			9,779
10		435,497		45,532		-		137,057		529		618,615		6			8,030
11		428,761		-		-		40,635		1,238		470,634		5			10,336
12		126,410		-		-		39,872		2,431		168,713		2			2,885
13		151,532		-		332,708		32,488		768		517,496		5			9,013
14,15,16		200,683		343		3,335		63,723		9,175		277,259		3			36,548
Collectively evaluated for impairment		6,522,429		1,387,022		336,043		1,106,746		33,257		9,385,497		98			90,680
Individually evaluated for impairment		71,648		-		46,433		27,808		13,048		158,937		2			16,753
Total commercial loans	$	6,594,077	$	1,387,022	$	382,476	$	1,134,554	$	46,305	$	9,544,434	(b)	100	%	$	107,433

	June 30, 2012
			Loans to												Allowance
	General		Mortgage				Income		Residential				Percent of		for Loan
(Dollars in thousands)	C&I		Companies		TRUPS (a)		CRE		CRE		Total		Total		Losses
PD Grade:
1	$	203,162	$	-	$	-	$	-	$	-	$	203,162	2	%	$	47
2		168,996		-		-		2,574		-		171,570	2			83
3		137,719		-		-		12,153		-		149,872	2			83
4		249,467		-		-		4,238		92		253,797	3			216
5		538,967		-		-		34,141		288		573,396	6			1,172
6		824,501		130,089		-		170,330		5,182		1,130,102	12			3,531
7		965,468		541,878		-		143,177		4,847		1,655,370	18			8,688
8		853,914		344,980		-		177,960		1,464		1,378,318	15			10,968
9		651,755		227,737		-		168,392		1,383		1,049,267	11			10,298
10		534,425		29,317		-		86,247		977		650,966	7			7,839
11		468,608		-		-		126,599		2,094		597,301	6			11,065
12		164,802		-		-		13,081		2,098		179,981	2			2,959
13		162,088		-		338,180		62,625		4,380		567,273	6			8,942
14,15,16		289,449		-		-		170,523		26,679		486,651	5			47,135
Collectively evaluated for impairment		6,213,321		1,274,001		338,180		1,172,040		49,484		9,047,026	97			113,026
Individually evaluated for impairment		81,070		0		74,793		52,904		39,741		248,508	3			39,165
Total commercial loans	$	6,294,391	$	1,274,001	$	412,973	$	1,224,944	$	89,225	$	9,295,534	100	%	$	152,191
Certain previously reported amounts have been reclassified to agree with current presentation.

The retail portfolio is comprised primarily of smaller-balance loans which are very similar in nature in that most are standard products and are backed by residential real estate. Because of the similarities of retail loan-types, FHN is able to utilize the Fair Isaac Corporation (“FICO”) score, among other attributes, to assess the quality of consumer borrowers. FICO scores are refreshed on a quarterly basis in an attempt to reflect the recent risk profile of the borrowers. Accruing delinquency amounts are indicators of asset quality within the credit card and other retail portfolio.

The following tables reflect period-end balances and average FICO scores by origination vintage for the HELOC, real estate installment, and permanent mortgage classes of loans as of June 30, 2013 and 2012:

HELOC
(Dollars in thousands)	June 30, 2013						June 30, 2012
			Average		Average				Average		Average
	Period End		Origination		Refreshed		Period End		Origination		Refreshed
Origination Vintage	Balance		FICO		FICO		Balance		FICO		FICO
pre-2003	$	98,178		712		702	$	153,428		721		715
2003		186,941		730		719		249,536		733		724
2004		447,817		727		718		546,681		728		719
2005		572,954		733		720		679,687		734		720
2006		421,023		740		726		500,840		741		726
2007		441,879		744		728		521,706		746		731
2008		240,776		754		747		279,200		755		749
2009		126,901		751		743		163,683		753		750
2010		128,058		753		750		159,522		754		753
2011		124,889		759		755		155,018		759		757
2012		153,692		759		759		79,029		761		760
2013		72,772		760		759		-		-		-
Total	$	3,015,880		740		730	$	3,488,330		740		730


R/E Installment Loans	June 30, 2013						June 30, 2012
(Dollars in thousands)			Average		Average				Average		Average
	Period End		Origination		Refreshed		Period End		Origination		Refreshed
Origination Vintage	Balance		FICO		FICO		Balance		FICO		FICO
pre-2003	$	29,998		683		684	$	46,628		688		686
2003		90,764		718		728		134,820		721		731
2004		61,949		702		705		84,741		708		705
2005		183,982		717		712		239,744		719		714
2006		197,308		716		704		261,208		720		706
2007		283,175		726		711		364,488		728		712
2008		98,690		724		719		131,770		729		725
2009		46,487		746		740		77,922		750		749
2010		138,621		747		753		173,949		746		754
2011		365,971		760		762		449,788		761		759
2012		727,688		764		764		402,176		765		763
2013		308,927		759		758		-		-		-
Total	$	2,533,560		745		742	$	2,367,234		739		733

For all portfolio segments and classes, loans are placed on nonaccrual status if it becomes evident that full collection of principal and interest is at risk, impairment has been recognized as a partial charge-off of principal balance, or on a case-by-case basis if FHN continues to receive payments, but there are atypical loan structures or other borrower-specific issues. PCI loans are classified in the table below as accruing. FHN does have a meaningful portion of loans that are classified as nonaccrual but where loan payments are received including residential real estate loans where the borrower has been discharged of personal obligation through bankruptcy and current second liens behind first liens with performance issues. The determination of whether a TDR is placed on nonaccrual status generally follows the same internal policies and procedures as other portfolio loans. However, FHN will typically place a consumer real estate loan on nonaccrual status if it is 30 or more days delinquent at the time of modification and is determined to be a TDR, except for residential real estate secured loans discharged in bankruptcy (“discharged bankruptcies”) that are placed on nonaccrual, regardless of delinquency status. Stand-alone second liens are placed on nonaccrual status if they are behind first liens that are 90 days or more past due or the first lien has been modified.

The following table reflects accruing and non-accruing loans by class on June 30, 2013:

	Accruing								Non-Accruing
			30-89		90+						30-89		90+		Total
			Days		Days		Total				Days		Days		Non-		Total
(Dollars in thousands)	Current		Past Due		Past Due		Accruing		Current		Past Due		Past Due		Accruing		Loans
Commercial (C&I):
General C&I	$	6,509,238	$	9,812	$	650	$	6,519,700	$	33,855	$	8,398	$	32,124	$	74,377	$	6,594,077
Loans to mortgage companies		1,386,679		-		-		1,386,679		-		-		343		343		1,387,022
TRUPs (a)		336,043		-		-		336,043		-		-		46,433		46,433		382,476
Purchased credit impaired loans		3,586		-		-		3,586		-		-		-		-		3,586
Total commercial C&I		8,235,546		9,812		650		8,246,008		33,855		8,398		78,900		121,153		8,367,161
Commercial real estate:
Income CRE		1,105,815		5,001		463		1,111,279		4,403		-		18,872		23,275		1,134,554
Residential CRE		35,995		203		-		36,198		748		-		9,359		10,107		46,305
Purchased credit impaired loans		36,408		856		83		37,347		-		-		-		-		37,347
Total commercial real estate		1,178,218		6,060		546		1,184,824		5,151		-		28,231		33,382		1,218,206
Consumer real estate:
HELOC		2,896,298		24,339		15,830		2,936,467		62,663		5,549		11,201		79,413		3,015,880
R/E installment loans		2,471,921		14,658		6,178		2,492,757		28,894		3,361		7,866		40,121		2,532,878
Purchased credit impaired loans		527		155		-		682		-		-		-		-		682
Total consumer real estate		5,368,746		39,152		22,008		5,429,906		91,557		8,910		19,067		119,534		5,549,440
Permanent mortgage		689,059		12,211		6,529		707,799		15,161		1,421		21,773		38,355		746,154
Credit card & other
Credit card		184,687		1,475		1,216		187,378		-		-		-		-		187,378
Other		126,511		370		98		126,979		1,705		5		-		1,710		128,689
Purchased credit impaired loans		17		1		-		18		-		-		-		-		18
Total credit card & other		311,215		1,846		1,314		314,375		1,705		5		-		1,710		316,085
Total loans, net of unearned	$	15,782,784	$	69,081	$	31,047	$	15,882,912	$	147,429	$	18,734	$	147,971	$	314,134	$	16,197,046

The following table reflects accruing and non-accruing loans by class on June 30, 2012:

	Accruing								Non-Accruing
			30-89		90+						30-89		90+		Total
			Days		Days		Total				Days		Days		Non-		Total
(Dollars in thousands)	Current		Past Due		Past Due		Accruing		Current		Past Due		Past Due		Accruing		Loans
Commercial (C&I):
General C&I	$	6,189,015	$	21,152	$	1,735	$	6,211,902	$	43,834	$	7,752	$	30,903	$	82,489	$	6,294,391
Loans to mortgage companies		1,274,001		-		-		1,274,001		-		-		-		-		1,274,001
TRUPs (a)		338,180		-		-		338,180		-		-		74,793		74,793		412,973
Total commercial C&I		7,801,196		21,152		1,735		7,824,083		43,834		7,752		105,696		157,282		7,981,365
Commercial real estate:
Income CRE		1,161,209		6,508		-		1,167,717		17,449		930		38,848		57,227		1,224,944
Residential CRE		44,413		5,973		-		50,386		19,505		921		18,413		38,839		89,225
Total commercial real estate		1,205,622		12,481		-		1,218,103		36,954		1,851		57,261		96,066		1,314,169
Consumer real estate:
HELOC		3,410,676		31,603		20,401		3,462,680		13,852		1,906		9,892		25,650		3,488,330
R/E installment loans		2,322,870		18,593		10,588		2,352,051		8,297		1,421		5,465		15,183		2,367,234
Total consumer real estate		5,733,546		50,196		30,989		5,814,731		22,149		3,327		15,357		40,833		5,855,564
Permanent mortgage		711,111		6,775		5,650		723,536		13,054		2,299		16,818		32,171		755,707
Credit card & other
Credit card		181,792		1,569		1,286		184,647		-		-		-		-		184,647
Other		91,535		369		339		92,243		268		-		1,800		2,068		94,311
Total credit card & other		273,327		1,938		1,625		276,890		268		-		1,800		2,068		278,958
Total loans, net of unearned	$	15,724,802	$	92,542	$	39,999	$	15,857,343	$	116,259	$	15,229	$	196,932	$	328,420	$	16,185,763

As part of FHN's ongoing risk management practices, FHN attempts to work with borrowers when necessary to extend or modify loan terms to better align with their current ability to repay. Extensions and modifications to loans are made in accordance with internal policies and guidelines which conform to regulatory guidance. Each occurrence is unique to the borrower and is evaluated separately. FHN considers regulatory guidelines when restructuring loans to ensure that prudent lending practices are followed. As such, qualification criteria and payment terms consider the borrower's current and prospective ability to comply with the modified terms of the loan.

A modification is classified as a TDR if the borrower is experiencing financial difficulty and it is determined that FHN has granted a concession to the borrower. FHN may determine that a borrower is experiencing financial difficulty if the borrower is currently in default on any of its debt, or if it is probable that a borrower may default in the foreseeable future. Many aspects of a borrower's financial situation are assessed when determining whether they are experiencing financial difficulty, particularly as it relates to commercial borrowers due to the complex nature of loan structures, business/industry risk, and borrower/guarantor structures. Concessions could include reductions of interest rates, extension of the maturity date at a rate lower than current market rate for a new loan with similar risk, reduction of accrued interest, or principal forgiveness. When evaluating whether a concession has been granted, FHN also considers whether the borrower has provided additional collateral or guarantors and whether such additions adequately compensate FHN for the restructured terms. The assessments of whether a borrower is experiencing (or is likely to experience) financial difficulty and whether a concession has been granted is subjective in nature and management's judgment is required when determining whether a modification is classified as a TDR.

For all classes within the commercial portfolio segment, TDRs are typically modified through forbearance agreements (generally 6 to 12 months). Forbearance agreements could include reduced interest rates, reduced payments, release of guarantor in exchange for payment, or entering into short sale agreements. FHN's proprietary modification programs for consumer loans are generally structured using parameters of U.S. government-sponsored programs such as Home Affordable Modification Programs (“HAMP”). Within the HELOC, R/E installment loans and permanent mortgage classes of the consumer portfolio segment, TDRs are typically modified by reducing the interest rate (in increments of 25 basis points to a minimum of 1 percent for up to 5 years) and a possible maturity date extension to reach an affordable housing debt ratio. Contractual maturities may be extended to 40 years on permanent mortgages and to 30 years for consumer real estate loans. Within the credit card class of the consumer portfolio segment, TDRs are typically modified through either a short-term credit card hardship program or a longer-term credit card workout program. In the credit card hardship program, borrowers may be granted rate and payment reductions for 6 months to 1 year. In the credit card workout program, customers are granted a rate reduction to 0 percent and term extensions for up to 5 years to pay off the remaining balance.

All loans that were acquired from MNB that would otherwise meet the criteria for classification as TDRs are excluded from the tables below.

On June 30, 2013 and 2012, FHN had $395.7 million and $338.8 million portfolio loans classified as TDRs, respectively. For TDRs in the loan portfolio, FHN had loan loss reserves of $67.5 million and $64.4 million, or 17 percent and 19 percent of TDR balances, as of June 30, 2013 and 2012, respectively. Additionally, FHN had restructured $188.9 million and $139.3 million of loans-held-for-sale as of June 30, 2013 and 2012, respectively. Loans held for sale are presented at UPB before fair value adjustments and do not carry reserves.

The following tables reflect portfolio loans (excluding acquired loans) that were classified as TDRs during the three and six months ended June 30, 2013 and 2012:

		Three Months Ended June 30, 2013					Six Months Ended June 30, 2013
			Pre-Modification		Post-Modification			Pre-Modification		Post-Modification
			Outstanding		Outstanding			Outstanding		Outstanding
(Dollars in thousands)		Number	Recorded Investment		Recorded Investment		Number	Recorded Investment		Recorded Investment
Commercial (C&I):
General C&I		3	$	14,947	$	14,941	8	$	16,189	$	16,179
	Total commercial (C&I)	3		14,947		14,941	8		16,189		16,179
Commercial real estate:
Income CRE		1		288		288	1		288		288
Residential CRE		-		-		-	-		-		-
	Total commercial real estate	1		288		288	1		288		288
Consumer real estate:
HELOC		92		8,758		8,734	207		16,517		16,285
R/E installment loans		97		13,390		13,326	276		19,675		19,559
	Total consumer real estate	189		22,148		22,060	483		36,192		35,844
Permanent mortgage		14		8,306		8,385	26		13,043		13,237
Credit card & other		17		92		89	28		154		148
Total troubled debt restructurings		224	$	45,781	$	45,763	546	$	65,866	$	65,696

		Three Months Ended June 30, 2012					Six Months Ended June 30, 2012
			Pre-Modification		Post-Modification			Pre-Modification		Post-Modification
			Outstanding		Outstanding			Outstanding		Outstanding
(Dollars in thousands)		Number	Recorded Investment		Recorded Investment		Number	Recorded Investment		Recorded Investment
Commercial (C&I):
General C&I		7	$	17,538	$	17,444	11	$	18,121	$	18,020
	Total commercial (C&I)	7		17,538		17,444	11		18,121		18,020
Commercial real estate:
Income CRE		3		546		529	6		8,507		8,358
Residential CRE		1		38		37	2		88		87
	Total commercial real estate	4		584		566	8		8,595		8,445
Consumer real estate:
HELOC		60		6,562		6,522	94		10,643		10,595
R/E installment loans		51		5,635		4,654	110		13,178		12,265
	Total consumer real estate	111		12,197		11,176	204		23,821		22,860
Permanent mortgage		24		19,774		19,998	62		49,667		50,062
Credit card & other		140		871		841	162		962		928
Total troubled debt restructurings		286	$	50,964	$	50,025	447	$	101,166	$	100,315

The following table presents TDRs which re-defaulted during the three and six months ended June 30, 2013 and 2012, and as to which the modification occurred 12 months or less prior to the re-default. Financing receivables that became classified as TDRs within the previous 12 months and for which there was a payment default during the period are calculated by first identifying TDRs that defaulted during the period and then determining whether they were modified within the 12 months prior to the default. For purposes of this disclosure, FHN generally defines payment default as 30 plus days past due.

		Three Months Ended			Six Months Ended
		June 30, 2013			June 30, 2013
			Recorded			Recorded
(Dollars in thousands)		Number	Investment		Number	Investment
Commercial (C&I):
General C&I		1	$	220	3	$	2,824
	Total commercial (C&I)	1		220	3		2,824
Commercial real estate:
Income CRE		-		-	-		-
Residential CRE		-		-	-		-
	Total commercial real estate	-		-	-		-
Consumer real estate:
HELOC		2		133	9		477
R/E installment loans		-		-	4		129
	Total consumer real estate	2		133	13		606
Permanent mortgage		1		211	10		4,609
Credit card & other		6		26	8		31
Total troubled debt restructurings		10	$	590	34	$	8,070
Certain previously reported amounts have been reclassified to agree with current presentation.

		Three Months Ended			Six Months Ended
		June 30, 2012			June 30, 2012
			Recorded			Recorded
(Dollars in thousands)		Number	Investment		Number	Investment
Commercial (C&I):
General C&I		11	$	9,069	18	$	13,059
	Total commercial (C&I)	11		9,069	18		13,059
Commercial real estate:
Income CRE		5		6,086	10		8,444
Residential CRE		1		136	2		186
	Total commercial real estate	6		6,222	12		8,630
Consumer real estate:
HELOC		6		420	16		1,630
R/E installment loans		11		1,476	29		3,182
	Total consumer real estate	17		1,896	45		4,812
Permanent mortgage		3		772	3		772
Credit card & other		4		16	15		52
Total troubled debt restructurings		41	$	17,975	93	$	27,325

The determination of whether a TDR is placed on nonaccrual status generally follows the same internal policies and procedures as other portfolio loans. However, FHN will typically place a consumer real estate loan on nonaccrual status if it is 30 or more days delinquent upon modification into a TDR. For commercial loans, nonaccrual TDRs that are reasonably assured of repayment according to their modified terms may be returned to accrual status by FHN upon a detailed credit evaluation of the borrower's financial condition and prospects for repayment under the revised terms. For consumer loans, FHN's evaluation supporting the decision to return a modified loan to accrual status includes consideration of the borrower's sustained historical repayment performance for a reasonable period prior to the date on which the loan is returned to accrual status, which is generally a minimum of six months. FHN may also consider a borrower's sustained historical repayment performance for a reasonable time prior to the restructuring in assessing whether the borrower can meet the restructured terms, as it may indicate that the borrower is capable of servicing the level of debt under the modified terms. Otherwise, FHN will continue to classify restructured loans as nonaccrual. Consistent with regulatory guidance, upon sustained performance and classification as a TDR over FHN's year-end, the loan will be removed from TDR status as long as the modified terms were market-based at the time of modification.