First Horizon Begins Preferred-Stock Offering

First Horizon National (FHN) of Memphis, Tenn., is raising capital by issuing preferred stock.

The parent of $25.5 billion-asset First Tennessee Bank announced Thursday an offering of depositary shares representing a fractional stake in its newly issued preferred stock. The preferred stock will pay a higher dividend than the company's common stock, First Horizon's head of investor relations, Aarti Bowman, said.

She did not disclose the sum that First Horizon hopes to raise, the percentage stake it hopes to sell or when the company expects the offering to close. The stock will be sold to a mixture of institutional and retail buyers, she said.

JPMorgan Chase (JPM), Citigroup (NYSE: C) and Goldman Sachs (GS) are joint bookrunners for the offering.

First Horizon said it will use the proceeds for general corporate purposes.

"We're just maintaining our capital levels. We're always analyzing cost-effective and efficient ways to manage it," Bowman said. "We obviously want to be well-capitalized in our regulatory environment."

The company recently has expanded its share buyback and dividend programs. First Horizon announced Wednesday that it was raising its buyback by $100 million, to a total of $300 million, and increasing its dividend fivefold, to 5 cents per share. Last week, the company announced a 16% rise in fourth-quarter profit.