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1Scan for outdated or missing drivers - takes under a minute2Clear out junk files and repair common Windows errors3Fix the driver behind crashes, sound loss and screen glitchesFirst Horizon Corporation, the Memphis-based parent of First Horizon Bank, has agreed to sell about $4.5 billion of lower-yielding consumer and residential mortgage loans. It is not selling the bank. The agreement was still awaiting settlement as of the company’s October 15, 2026, release, with closing expected early in the fourth quarter.
What First Horizon is selling
The transaction covers approximately $4.5 billion of selected consumer and residential mortgage loans. Management characterizes these assets as lower-yielding and, in some cases, less connected to the bank’s relationship-banking strategy. The sale concerns a portfolio of loans, not First Horizon Corporation, First Horizon Bank, its branches or its customer franchise.
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The buyer, final purchase price and any discount to the loans’ recorded value were not disclosed in the company materials and reports reviewed. The sources also do not establish the individual loan types, geographic mix, or whether servicing arrangements will change.
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First Horizon says the sale is a balance-sheet repositioning. Removing lower-return assets is intended to create room for loans that can support deeper relationships with commercial, small-business and consumer customers. Chairman, president and chief executive officer Bryan Jordan said the transaction “will be accretive to earnings on a go forward basis and will provide balance sheet flexibility to support future loan growth.”
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In practical terms, the bank is exchanging part of its existing mortgage exposure for capacity. That capacity can be used as new lending demand develops, rather than leaving as much of the balance sheet tied up in mortgages that management considers less strategically valuable.
How the sale affected third-quarter results
Because the targeted mortgages were reclassified as held for sale, the transaction had a substantial effect on First Horizon’s third-quarter reported numbers. The company recorded notable items totaling $347 million after tax, or $0.73 per share, according to its 2026 third-quarter reporting. It also reported a net loss available to common shareholders of $94 million, or $0.20 per share.
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Those figures describe the quarter that included the accounting effects of the repositioning; they do not mean the bank sold the entire mortgage business or that the same charge will recur every quarter. Investors should distinguish the one-quarter reclassification and related marks from management’s expectation of improved earnings economics after the portfolio is removed.
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| Measure | Figure | Qualification |
|---|---|---|
| Mortgage portfolio covered by the agreement | Approximately $4.5 billion | Selected lower-yielding consumer/residential loans; settlement was pending as of October 15, 2026 |
| Notable items | $347 million after tax; $0.73 per share | First Horizon’s third-quarter 2026 reporting |
| Net loss available to common shareholders | $94 million; $0.20 per share | Third quarter of 2026 |
| Total assets | $84.3 billion | As of September 30, 2026 |
| Credit-card and consumer-real-estate loan balance | $13.9 billion to $9.2 billion | Change reported by the Memphis Business Journal after the mortgage sale |
| Third-quarter revenue | $407 million versus $887 million | Comparison reported by the Memphis Business Journal with the prior quarter |
What the balance-sheet change means for shareholders
Shareholders are seeing two different time frames. The immediate presentation is a weaker third quarter, because the held-for-sale classification and related notable items reduced reported earnings. The intended longer-term effect is a smaller allocation to lower-yielding mortgages and more flexibility to deploy capital into loans management believes can produce stronger relationship and earnings returns.
That future benefit remains an expectation until the transaction closes and the bank demonstrates how it redeploys the capacity. The announcement does not provide a buyer, final pricing or a quantified forecast for the earnings improvement, so investors cannot calculate the eventual gain from the public information alone.
What customers should expect
For borrowers whose mortgages are included, the agreement itself does not establish a change in interest rate, payment schedule or servicing contact. The available sources do not say whether servicing will be retained by First Horizon or transferred. Customers should rely on written notices from the bank or any future servicer rather than assuming that the sale changes their loan terms.
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Other First Horizon customers should understand that this is a portfolio-management decision. First Horizon Bank continues to operate as the bank subsidiary of First Horizon Corporation. The company reported $84.3 billion in assets at September 30, 2026, and the bank operates in 12 states concentrated in the southern United States.
When the transaction takes effect
The agreement was announced in early October 2026, and the October 15 release said settlement was expected early in the fourth quarter. Until settlement occurs, the sale is an announced transaction rather than a completed transfer. Closing timing, final proceeds and any adjustments at settlement were not provided in the cited materials.
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Who bought the mortgages?
First Horizon has not identified the buyer in the sources available for this report. No responsible conclusion can be drawn about the purchaser, its funding, or its plans for the loans. The same limitation applies to the final price and the detailed loan-level composition.
Quick Recap
How to read the announcement
- It is a portfolio sale, not a bank sale. The agreement covers about $4.5 billion of mortgages and consumer loans.
- The third-quarter loss includes a large transaction-related effect. The $347 million after-tax notable items and $94 million common-shareholder loss belong to the reported quarter.
- The strategic case is forward-looking. Management expects earnings accretion and more room for future loan growth, but has not published a quantified benefit.
- Several key details remain undisclosed. The buyer, final pricing, exact loan mix and servicing outcome are not established.
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