First Horizon National Corp. of Memphis is “very close” to acquiring a small bank in Georgia that would supply the charter it needs to proceed with a retail banking expansion into the state, its top executive in Atlanta said Tuesday.
Tammy Driggers, a veteran Atlanta banker hired in January to oversee the Georgia expansion, said the $29 billion-asset company expects to announce a deal soon, though she declined to name the target.
“We will definitely be acquiring a bank here,” said Ms. Driggers, who ran wholesale banking at National Commerce Financial Corp. of Memphis until SunTrust Banks Inc. of Atlanta bought it last fall. She had also worked for First Union Corp. (now Wachovia Corp.) of Charlotte and SunTrust.
First Horizon has long been one of the largest banks in Tennessee. It is now in the early stages of expanding into more than a dozen major cities nationwide.
The expansion began in northern Virginia, where it hired local bankers and opened seven branches in 2004. It also has begun accepting deposits at mortgage offices in the Dallas/Fort Worth market and hopes to open seven to 10 full-fledged bank branches there this year. Atlanta is First Horizon’s third major market, and Ms. Driggers said Tuesday that she hopes to open at least two branches there by the end of the third quarter, followed by four or five in the first quarter of next year.
The national expansion initially is targeting customers of the company’s national mortgage division, First Horizon Home Loan Corp. of Irving, Tex.
In Atlanta, First Horizon currently has about 18,000 mortgage customers, Ms. Driggers said. “Our retail strategy is really focused on where our existing customer base is, and cross-selling those clients,” she said Tuesday.
In January, after the fourth-quarter earnings report, chief executive Kenneth Glass told analysts that First Horizon had sold additional products to about 35% of its northern Virginia mortgage customers.
The growth outside Tennessee, though still small, is beginning to yield returns. Profits from retail and commercial banking operations elsewhere more than doubled last year, to $216 million, said Mr. Glass, who is also the company’s chairman and president.
First Horizon officials had said in December that they were shopping for a small bank, which they want mainly for its charter. Under Georgia law, out-of-state banks cannot open branches or take deposits unless they acquire an existing bank in the state.
Analysts said Tuesday that First Horizon could achieve its goal by acquiring a very small bank, perhaps one with just a single branch, and possibly one that is still privately held.
“It doesn’t need to be a macro-size acquisition,” said Gary Townsend, an analyst at Friedman, Billings Ramsey & Co. Inc. in Arlington, Va. “They may be strictly after the charter, without the idea that it’s a company they want to build.”
