Market Overview

Kroll Bond Rating Agency Comments on Capital Bank Financial Corp.'s Merger with First Horizon National Corp.


Kroll Bond Rating Agency (KBRA) releases research report entitled
"Comment on Capital Bank Financial Corp. Merger with First Horizon
National Corp."

The report makes the following key points:

  • Capital Bank Financial Corp. (NASDAQ:CBF) and its subsidiary Capital
    Bank Corporation, announced a definitive agreement to merge with First
    Horizon National Corp. (NYSE:FHN) (First Horizon), the holding company
    and parent of First Tennessee Bank National Association.
  • The deal, valued at $2.2 billion, is expected to close during the
    fourth quarter of 2017 and would result in the creation of the fourth
    largest regional bank in the Southeast with approximately $40 billion
    in assets, $32 billion in deposits, and $27 billion in loans, based on
    financials as of March 31, 2017.
  • In October of 2016, KBRA affirmed the senior unsecured debt rating of
    BBB+, subordinated debt rating of BBB, and short-term debt rating of
    K2 for Capital Bank Financial Corp. KBRA also affirmed the deposit and
    senior unsecured debt ratings of A-, subordinated debt rating of BBB+,
    and short-term debt and deposit ratings of K2 for Capital Bank
    Financial Corp.'s subsidiary, Capital Bank Corporation. The outlook on
    all long-term ratings is stable.
  • First Horizon National Corp. appears to have sound overall financial
    condition. Based on fourth quarter 2016 financials, KBRA's
    Subscription Rating Service (SRS) rated First Horizon National Corp. a
    B on the financial strength rating (FSR) scale.
  • Ratings of Capital Bank Financial Corp. and its subsidiary bank will
    likely be impacted when the merger closes, given that Capital Bank
    Financial Corp. and Capital Bank Corporation will merge into First
    Horizon National Corp. Potential rating actions include withdrawal of
    all ratings, partial withdrawal of ratings, or maintaining existing
    ratings for Capital Bank Corporation.

The ratings are based on KBRA's Global
Bank and Bank Holding Company Rating Methodology
published on
February 19, 2016.

Please click here
to view the report.

About Kroll Bond Rating Agency

KBRA is registered with the U.S. Securities and Exchange Commission as a
Nationally Recognized Statistical Rating Organization (NRSRO). In
addition, KBRA is recognized by the National Association of Insurance
Commissioners (NAIC) as a Credit Rating Provider (CRP).

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