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# First Horizon posts $94 million Q3 loss as it agrees $4.5 billion mortgage sale
- URL: https://www.theglobalbanker.com/first-horizon-posts-94-million-q3-loss-as-it-agrees-4-5-billion-mortgage-sale/
- Published: 2026-10-16T12:43:24.000Z
- Updated: 2026-10-16T12:43:24.000Z
- Description: First Horizon reported a third-quarter net loss to common shareholders of $94 million after reclassifying mortgages for sale, while adjusted earnings per share of $0.53 rose $0.02 from a year earlier.
- Author: TGB Editorial Team
- Tags: Banking News, Americas, #newsroom, #needs-photo

First Horizon reported a net loss available to common shareholders of $94 million, or $0.20 per share, for the third quarter of 2026\. The company said the result reflects strategic actions to align its balance sheet with its growth priorities. It began evaluating the sale of about $4.5 billion of lower-yielding consumer mortgages during the quarter and agreed to sell them in early October.

Excluding notable items, adjusted earnings per share were $0.53\. That was down $0.01 from $0.54 in the second quarter of 2026 and up $0.02 from $0.51 in the third quarter of 2025.

## MORTGAGE RECLASSIFICATION DRIVES THE CHARGES

Reported results include notable items totalling $0.73 per share, or $347 million after tax. These relate primarily to the reclassification of targeted mortgage loans to held for sale in relation to the pending portfolio sale.

The pending sale of roughly $4.5 billion of low-yielding consumer mortgages carried a pre-tax loss of $473 million, which moved the company to a GAAP loss.

## EXPECTED BENEFITS OF THE SALE

First Horizon said the transaction will add to earnings going forward and give the balance sheet flexibility to support future loan growth. Management expects the sale to lift 2027 earnings per share by about 4% and 2027 return on tangible common equity by about 150 basis points. The transaction is expected to settle early in the fourth quarter of 2026.

## REVENUE, EFFICIENCY AND DEPOSITS

Revenue of $883 million was approximately $6.37 million below the consensus forecast of $889.37 million. The adjusted efficiency ratio improved to 58.9% from 60.8% a year earlier.

Chairman, President and CEO Bryan Jordan said average client deposit balances rose $1.3 billion in the quarter. He added that the bank continues to focus on growing and maintaining full client relationships and deploying capital where it best serves long-term value creation. "This quarter's results are a testament to our disciplined approach and clear strategic priorities," he said.

## GUIDANCE, INVESTOR CALL AND BACKGROUND

First Horizon had $84.3 billion in assets at 30 September 2026, slightly below the $84.4 billion at 30 June. It is headquartered in Memphis, and First Horizon Bank operates in 12 states, concentrated in the southern US. The company offers commercial, private banking, consumer, small business, wealth and trust management, retail brokerage, capital markets, fixed income and mortgage banking services.