First Horizon Plans About $4.5 Billion Loan Sale, Targets 4% EPS Gain

First Horizon plans to sell about $4.5 billion in residential mortgage loans, a balance-sheet change the bank expects to lift 2027 earnings per share by about 4%. The bank reached an agreement in October and expects the transaction to settle early in the fourth quarter. It also projects about a 150-basis-point improvement in 2027 return on tangible common equity. First Horizon projected the sale would improve its loan-to-deposit ratio by about 700 basis points to roughly 88%. At third-quarter end, the ratio was already 88%, down 763 basis points from the previous quarter after the targeted loans were reclassified as held for sale. The bank’s third-quarter net interest margin was 3.48%, down one basis point from the prior quarter. Adjusted diluted earnings per share was 53 cents.

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