A rebound for a homegrown bank

Third quarter earnings season is upon us, and in the next week or so a slew of local banks will be reporting how much they made or lost over the last three months.

The bank with the largest share of the Memphis banking market posted strong third quarter numbers Friday.

First Horizon National Corp. – whose First Tennessee Bank held 34.03 percent of all local bank deposits as of June 30, putting it in the top spot on the FDIC’s 2009 market share report also released Friday – beat analyst expectations handily. The bank reported an earnings loss for the quarter of $52.9 million, a major improvement compared to the net loss in Q3 2008 of $118.3 million. The net loss equaled $.24 per diluted share, whereas analysts were expecting a loss above $.30 per share.

Revenue for the quarter topped $494 million.

The bank saw declines in troubled loans and socked away less money to cover potential losses. Its net interest margin grew from 3.05 percent to 3.14 percent, another good sign. That number is a margin that tells how profitably a bank is lending money at rates higher than the rate at which it borrows money.

One analyst thinks it’s a strong bet First Horizon will pay back its $866 million TARP investment by mid-2010.

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