First Horizon Corporation · NYSE:FHN
First Horizon — Merger or Acquisition (November 2019)
30 slides from First Horizon's merger presentation, Nov 4, 2019
Slide 1: Proven. Focused. Better Together. A Merger of Equals
Proven. Focused. Better Together. A Merger of Equals November 4, 2019
Slide 2: Disclaimer
Disclaimer Forward-Looking Statement This presentation contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Ac
Slide 3: Presenters
Presenters D. Bryan Jordan Daryl G. Byrd William C. (BJ) Losch III Anthony J. Restel Chairman, President & President & Executive Vice President, Vice Chairman, Chief Executive Officer Chief Executive Officer Chief Financial Officer Chief Financial Officer First Horizon IBERIABANK First Horizon IBERI
Slide 4: Overview of Merger of Equals
Overview of Merger of Equals Combined $75Bn $57Bn $55Bn Company by the Numbers: IN ASSETS IN DEPOSITS IN LOANS COMPELLING STRATEGIC BENEFITS Strong cultural alignment with valued-based employee cultures, Proven strong credit culture and risk management practices exceptional relationship-oriented cus
Slide 5: Proven. Focused. Better Together.
Proven. Focused. Better Together. Premier Southern-Based Bank Complementary Market Position Diversified Business Mix Merger of Equals Peer Leading Profitability Financially Attractive Experienced Leadership Team PROVEN. FOCUSED. BETTER TOGETHER. 5
Slide 6: Creating a Top-Tier Differentiated U.S. Banking Institution
Creating a Top-Tier Differentiated U.S. Banking Institution Long-Lived History, Common Culture and Shared Philosophy Position the Company for Success Premier Southern-Based Bank Complementary Market Position Diversified Business Mix Premier Southern banking Strengthens competitive position in
Slide 7: Combination Summary
Combination Summary • Merger of Equals • 56% First Horizon Structure • IBERIABANK merges into First Horizon Ownership • 44% IBERIABANK • 100% stock consideration • Fixed exchange ratio, set at-market based on November 1, 2019 close Exchange Name • First Horizon Ratio • IBERIABANK shareholders will r
Slide 8: Balanced Board and Combined Executive Leadership Team
Balanced Board and Combined Executive Leadership Team Strong Industry Expertise, Common Cultures & Experience Integrating Large Transactions Executive Leadership Team Board of Directors Daryl Byrd Bryan Jordan Executive Chief Executive Chairman Officer Executive Lead Chairman Director Terry Akins Ta
Slide 9: Complementary Franchises With Presence Across Attractive Markets
Complementary Franchises With Presence Across Attractive Markets Expansive Geographic Footprint Enhancing Our Presence in High Growth Markets Memphis, TN New Orleans, LA Nashville, TN WV VA MO KY NC TN OK SC AR GA Miami, FL Orlando, FL Houston, TX MS AL LA TX FL First Horizon IBERIABANK Atlanta, GA
Slide 10: Attractive Scale, Profitability & Shareholder Value Creation
Attractive Scale, Profitability & Shareholder Value Creation Significant Pro Forma Scale Peer Leading Profitability Value of Cost Synergies Accrues to All Shareholders (2) Market Cap $9Bn+ ROAA (1) 1.4% $1Bn Assets $75Bn ROATCE (1) 18% Value of 44% Synergies (2) 56% Deposits $57Bn Efficiency Ratio (
Slide 11: Top Tier Profitability Profile
Top Tier Profitability Profile Increased Return Profile Supports Stronger Incremental Capital Generation Over Time ROATCE (2020E) (1) Efficiency Ratio (2020E) (1) 20% 18%(2) 70% 16% 16% Median: 15% 60% 60% Median: 58% 13% 55% 12% 51%(2) 50% 8% 4% 40% Pro Pro Forma Forma ROAA (2020E) (1) 2021E vs. 20
Slide 12: Investing in Growth
Investing in Growth • Provides enhanced and diversified income • Wider customer base stream to drive future growth Greater • Expansive geographic footprint Size & Scale… • Enables greater leverage in technology, marketing and overhead investment • Well-balanced product suite GREATER GREATER • Levera
Slide 13: Well-Diversified Revenue Streams
Well-Diversified Revenue Streams Stable sources of revenue across differentiated products Fee income mix positions us well in current environment Appropriately scaled businesses Opportunities for cross-sell and expanded products ~$3.0Bn of Pro Forma Revenue ~$800MM of Pro Forma Fee Income Total Reve
Slide 14: Complementary Loan Portfolio
Complementary Loan Portfolio Strong market-based relationships Well-diversified geographic portfolio Differentiated specialty lending verticals Balanced loan composition $55Bn in Pro Forma Loans (1) Composition by Type Composition by Geography (2)(3) Home Eq. & Other 6% Tennessee Other 22% Residenti
Slide 15: Strong Combined Deposit Franchise
Strong Combined Deposit Franchise Balanced presence in high-growth and stable markets Strong core deposit base Commitment to key geographies and attractive MSAs Excess liquidity provides future growth pathway $57Bn in Pro Forma Deposits (1) Composition by Type Composition by Geography (2) Jumbo Time
Slide 16: Extensive Suite of Products & Capabilities
Extensive Suite of Products & Capabilities Increases Customer Value Proposition for Combined Company Products & Capabilities Key Products First Horizon IBERIABANK Pro Forma Commercial (C&I & CRE) Business Banking Asset Based Lending Mortgage Warehouse Lending Commercial Franc
Slide 17: Extensive Due Diligence Process
Extensive Due Diligence Process Thorough Due Diligence & Demonstrated M&A Track Record Will Lead to Successful Integration Comprehensive Due Ability to Leverage Successful Diligence & Preparation Integration History Disciplined & Experienced With M&A • Both First Horizon and IBERIABANK management an
Slide 18: Key Transaction Assumptions
Key Transaction Assumptions • At-market, 100% stock transaction where IBERIABANK merges into First Horizon Consideration • First Horizon issues shares; fixed exchange ratio of 4.584 FHN shares for each IBKC share Earnings Estimates • Projections based on Wall Street consensus estimates • $170MM pre-
Slide 19: Attractive Pro Forma Financial Impacts
Attractive Pro Forma Financial Impacts Pro Forma Financial Impacts Pro Forma Operating Metrics GAAP with Current Pro Key Items Key Items CECL (1) Accounting Forma EPS Accretion to First Horizon (%) (2) 16% 11% ROAA (%) 1.4% (Fully phased-in cost savings) EPS Accretion to IBERIABANK (%) (2) 22% 17% R
Slide 20: Value of Cost Synergies Accrues to All Shareholders
Value of Cost Synergies Accrues to All Shareholders Significant Potential Value Creation Summary of Cost Synergies $Bn Other Expenses 10% 12 Occupancy +11% 10% $10.0Bn Staffing Efficiencies Total Cost & Overhead $1.0Bn Redundancies $9.0Bn Synergies: 50% $170MM Legacy Systems & 8 Computer Services 30
Slide 21: Significant Upside on a Pro Forma Basis
Significant Upside on a Pro Forma Basis Relative to Peer Banks Between $50-150Bn in Assets ROATCE (2020E) (%)(1) ROAA (2020E) (%)(1) Efficiency Ratio (2020E) (%)(1) 18 1.4 1.3 58 16 56 15 1.2 Attractive Pro Forma 51 Profitability Metrics Pro Forma Peer Top Peer Median Pro Forma Peer Top Peer Median
Slide 22: Combination Provides Benefits to All Constituents
Combination Provides Benefits to All Constituents Together We Will Have a Combined $10Bn Community Benefit Plan COMMUNITIES EMPLOYEES CUSTOMERS & ENVIRONMENT & CULTURE SHAREHOLDERS • Greater capabilities and • Combined company will • Consistent corporate • Double-digit earnings expanded product suit
Slide 23: Better Together
Better Together PROVEN. FOCUSED. BETTER TOGETHER. 23
Slide 24: Additional Materials
Additional Materials Py FIRST HORIZON. IBERIABANK
Slide 25: Complementary Market Presence Throughout the South
Complementary Market Presence Throughout the South Footprint Has Significant Scale & Customer Reach in Major Markets Pro Forma Geographic Footprint Pro Forma MSAs with +$1Bn of Deposits Avg. Deposits / Deposits Branches Branch WV Top MSAs ($Bn) (#) ($MM) Rank KS MO VA KY Memphis (1) 11.0 43 255 1 NC
Slide 26: Strengthened Footprint in Large & Attractive Southern Markets
Strengthened Footprint in Large & Attractive Southern Markets Franchise Balanced Between High Growth Markets & Stable Markets Key Highlights Presence in 15 of Top 20 Southern MSAs (1) Population Leading position in high growth Southern markets (2019) (000s) # MSA Name 1 Dallas-Fort Worth-Arlingt
Slide 27: Top Pro Forma Geographies
Top Pro Forma Geographies Pro Forma - Top States Pro Forma – Top 20 MSAs Deposits Branches Avg. Dep. / Mkt. Sh. Deposits Branches Avg. Dep. / Mkt. Sh. No. Top States ($Bn) (#) Branch ($MM) Rank (%) No. Top MSAs ($Bn) (#) Branch ($MM) Rank (%) 1 Memphis 11.0 43 255 1 34.4 1 Tennessee 25.0 171 146 1 1
Slide 28: Commitment to Our Communities
Commitment to Our Communities Each Bank Has a Strong Dedication to the Communities & Markets in Which We Operate • Last year, First Horizon announced a five-year, $3.95Bn • In 2017, committed to a 5-year, $6.7Bn community benefit community benefit plan to increase access to financial plan to increas
Slide 29: Purchase Accounting Summary
Purchase Accounting Summary Tangible Book Value per Share Build-Up Calculation of Intangibles ($) Cumulative Impact ($MM) $11 Individual Component Impact IBKC Est. TCE at Closing 2,851 +3.6% $10.54 Net Loan FMV Adjustments (5) (112) $0.36 Other FMV Adjustments (59) $0.42 $10.18 (3.1)% Pre-Tax FMV Ad
Slide 30: Earnings per Share Impact
Earnings per Share Impact Earnings per Share Impact Build-Up Excluding Accretion GAAP of Non-PCD Loan With CECL Credit Discount 2021 Estimates ($MM) ($MM) First Horizon Consensus Mean Standalone Earnings Estimate 508 508 IBERIABANK Consensus Mean Standalone Earnings Estimate 362 362 First Horizon Co
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