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<SEC-DOCUMENT>0000950117-05-000949.txt : 20050314
<SEC-HEADER>0000950117-05-000949.hdr.sgml : 20050314
<ACCEPTANCE-DATETIME>20050314162751
ACCESSION NUMBER:		0000950117-05-000949
CONFORMED SUBMISSION TYPE:	10-K
PUBLIC DOCUMENT COUNT:		22
CONFORMED PERIOD OF REPORT:	20041231
FILED AS OF DATE:		20050314
DATE AS OF CHANGE:		20050314

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			FIRST HORIZON NATIONAL CORP
		CENTRAL INDEX KEY:			0000036966
		STANDARD INDUSTRIAL CLASSIFICATION:	NATIONAL COMMERCIAL BANKS [6021]
		IRS NUMBER:				620803242
		STATE OF INCORPORATION:			TN
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-15185
		FILM NUMBER:		05678723

	BUSINESS ADDRESS:	
		STREET 1:		165 MADISON AVENUE
		CITY:			MEMPHIS
		STATE:			TN
		ZIP:			38103
		BUSINESS PHONE:		9018186232

	MAIL ADDRESS:	
		STREET 1:		165 MADISON AVENUE
		CITY:			MEMPHIS
		STATE:			TN
		ZIP:			38103

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	FIRST TENNESSEE NATIONAL CORP
		DATE OF NAME CHANGE:	19920703

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	FIRST TENNESSEE BANKS INC
		DATE OF NAME CHANGE:	19600201
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<FILENAME>a39355.txt
<DESCRIPTION>FIRST HORIZON NATIONAL CORPORATION
<TEXT>

<PAGE>


                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                    FORM 10-K

(Mark One)

[X]               ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934
                   For the fiscal year ended December 31, 2004
                                     - or -
[ ]           TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
             For the Transition period from __________ to__________

                        Commission File Number 001-15185

                       FIRST HORIZON NATIONAL CORPORATION
             (Exact name of registrant as specified in its charter)

TENNESSEE                                           62-0803242
(State or other jurisdiction of                     (I.R.S. Employer
incorporation or organization)                      Identification Number)

165 Madison Avenue, Memphis, Tennessee              38103
(Address of principal executive offices)            (Zip Code)

        Registrant's telephone number, including Area Code: 901-523-4444

           Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class                        Name of Exchange on which Registered
- -------------------                        ------------------------------------
$0.625 Par Value Common Capital Stock      New York Stock Exchange, Inc.
(including rights attached thereto)


        Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.  X  YES     NO
                                   ---      ---

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (Section 229.405 of this chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K.  X
                                              ---

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act).  X  YES     NO
                                   ---      ---

At June 30, 2004, the aggregate market value of the voting and non-voting common
equity of the registrant held by non-affiliates of the registrant was
approximately $5.5 billion.

At February 25, 2005, the registrant had 123,900,266 shares of common stock
outstanding.

DOCUMENTS INCORPORATED BY REFERENCE:

         1. Portions of Proxy Statement to be furnished to shareholders in
            connection with Annual Meeting of Shareholders scheduled for
            4/19/05 - Parts I, II, III and IV.







<PAGE>


                                     PART I

                                     ITEM 1
                                    BUSINESS

General.

         First Horizon National Corporation (the "Corporation") is a Tennessee
corporation headquartered in Memphis, Tennessee and incorporated in 1968. The
Corporation is registered as a bank holding company under the Bank Holding
Company Act of 1956, as amended, and is a financial holding company under the
provisions of the Gramm-Leach-Bliley Act. At December 31, 2004, the Corporation
had total assets of $29.8 billion and ranked 1st in terms of total assets among
Tennessee-headquartered bank holding companies and ranked 28th nationally.

         Through its principal subsidiary, First Tennessee Bank National
Association (the "Bank"), and its other banking-related subsidiaries, the
Corporation provides diversified financial services through four business
segments. The segments reflect the common activities and operations of
aggregated business segments across the various delivery channels:
Retail/Commercial Banking, Mortgage Banking, and Capital Markets. In addition,
the Corporate segment provides essential support within the Corporation. The
percentage of consolidated revenues (for this purpose, the sum of net interest
income and noninterest income) ascribed to each of our segments for the past
three years was: Retail/Commercial Banking, 53% (2004), 42% (2003), and 46%
(2002); Mortgage Banking, 28% (2004), 35% (2003), and 29% (2002); Capital
Markets, 17% (2004), 22% (2003), and 22% (2002); and Corporate, 2% (2004), 1%
(2003), and 3% (2002). Financial and other additional information concerning our
segments appears in the response to Item 7 of Part II hereof and Note 22 to the
Consolidated Financial Statements contained in the Corporation's 2004 Annual
Report to shareholders. During 2004 approximately 61% of revenues were provided
by fee income and approximately 39% of revenues were provided by net interest
income. As a financial holding company, the Corporation coordinates the
financial resources of the consolidated enterprise and maintains systems of
financial, operational and administrative control intended to coordinate
selected policies and activities, including as described in Item 9A of Part II
hereto.

         The Bank is a national banking association with principal offices in
Memphis, Tennessee. It received its charter in 1864. During 2004 through its
various business lines, including consolidated subsidiaries, the Bank
generated gross revenue (net interest income plus noninterest income) of
approximately $2.2 billion and contributed substantially all of consolidated net
income from continuing operations. At December 31, 2004, the Bank had $29.5
billion in total assets, $19.8 billion in total deposits, and $16.3 billion in
total net loans. Among Tennessee headquartered banks, the Bank ranked 1st in
Tennessee deposit market share at June 30, 2004. On December 31, 2004, the Bank
had 496 banking locations (187 financial centers and 309 off-premises ATMs) in
18 Tennessee counties, including all of the major metropolitan areas of the
state, 13 banking locations (7 financial centers and 6 off-premises ATMs) in
Mississippi, one off premises ATM in Arkansas, and 7 financial centers in
Virginia. At December 31, 2004, First Horizon Home Loan Corporation, a
subsidiary of the Bank with principal offices in the Dallas, Texas metropolitan
area, and its affiliates provided mortgage banking services through 357 offices,
including satellite branches, in 44 states and, at September 30, 2004, ranked in
the top 20 nationally in retail mortgage loan originations and top 15 nationally
in mortgage loan servicing, as reported by Inside Mortgage Finance. FTN
Financial products and services, at December 31, 2004, were offered through 14
offices in 11 states, and FTN Financial Capital Markets, a division of the Bank,
ranked as one of the leading underwriters of U.S. agency debt.




                                                                               1






<PAGE>


         The Corporation provides the following services through its
subsidiaries:

         o  general banking services for consumers, businesses, financial
            institutions, and governments

         o  mortgage banking services

         o  through FTN Financial-sales and underwriting of bank-eligible
            securities and securities eligible for underwriting by financial
            subsidiaries, mortgage loans and advisory services, and equity
            research

         o  transaction processing - credit card merchant processing, nationwide
            check clearing services, and remittance processing

         o  trust, fiduciary, and agency services

         o  credit card products

         o  discount brokerage and full-service brokerage

         o  venture capital

         o  equipment finance

         o  investment and financial advisory services, including investment
            advisor to First Funds, a proprietary family of mutual funds

         o  mutual fund sales as agent

         o  retail and commercial insurance sales as agent

         o  private mortgage reinsurance

         o  consumer lending

         An element of the Corporation's business strategy is to seek
acquisitions and consider divestitures that would enhance long-term shareholder
value. The Corporation has a department charged with this responsibility which
is constantly reviewing and developing opportunities to achieve this element of
the Corporation's strategy. Acquisitions and divestitures which closed during
the past three years are described in Note 2 to the Consolidated Financial
Statements.

         All of the Corporation's subsidiaries are listed in Exhibit 21. The
Bank has filed notice with the Comptroller of the Currency ("Comptroller") as a
government securities broker/dealer. The FTN Financial Capital Markets division
of the Bank is registered with the Securities and Exchange Commission ("SEC") as
a municipal securities dealer. The Bank is supervised and regulated as described
below. Highland Capital Management Corp., Martin and Company, Inc., First
Tennessee Advisory Services, a separately identifiable department of the Bank,
and First Tennessee Brokerage, Inc. are registered with the SEC as investment
advisers. Hickory Venture Capital Corporation is licensed as a Small Business
Investment Company. First Tennessee Brokerage, Inc., FTN Financial Securities
Corporation and FTN Midwest Securities Corporation are registered as
broker-dealers with the SEC and all states where they conduct business for which
registration is required. First Horizon Home Loan Corporation is licensed as a
mortgage lender (or exempt from licensing) in all states where it does business
and is regulated by the Comptroller. First Tennessee Insurance Services, Inc.
("FTIS") and First Horizon Insurance Services, Inc. ("FHIS") are licensed as
insurance agencies in all states where they do business for which licensing is
required. FT Reinsurance Company is licensed by the state of South Carolina as a
monoline insurance company. FT Insurance Corporation is licensed as an insurance
agency in Alabama. Synaxis Group, Inc.'s subsidiaries, which include Polk &
Sullivan Group, Inc., Synaxis Risk Services, Inc., Merritt & McKenzie, Inc., and
Van Meter Insurance, Inc., are licensed as insurance agencies in all states
where they do business for which licensing is required. FTN Financial Securities
Corporation, FTN Midwest Securities Corporation, FHIS, and FTIS and all of the
subsidiaries listed in the preceding sentence are financial subsidiaries under
the Gramm-Leach-Bliley Act. First Tennessee





                                                                               2






<PAGE>


Brokerage, Inc. is licensed as an insurance agency in the states where it does
business for which licensing is required for the sale of annuity products.

         Expenditures for research and development activities were not material
in any of the last three fiscal years.

         Neither the Corporation nor any of its significant subsidiaries is
dependent upon a single customer or very few customers.

         At December 31, 2004, the Corporation and its subsidiaries had 12,825
employees and 12,470 full-time-equivalent employees, not including contract
labor for certain services.

         For additional information on the business of the Corporation, refer to
the Management's Discussion and Analysis and Glossary sections contained in
pages 3 through 52 of the Corporation's 2004 Annual Report to shareholders,
which sections are incorporated herein by reference.

         The Corporation's current internet address is www.firsthorizon.com. The
Corporation plans to launch a new corporate website in the first quarter of 2005
at www.fhnc.com. The Corporation makes available free of charge on its Internet
website its annual reports on Form 10-K, quarterly reports on Form 10-Q, current
reports on Form 8-K, and amendments thereto as soon as reasonably practicable
after the Corporation files such material with, or furnishes such material to,
the Securities and Exchange Commission, as applicable.

Corporate Governance and NYSE Disclosures.

         The Corporation's Board of Directors has adopted Corporate Governance
Guidelines, along with a Code of Business Conduct and Ethics, a Code of Ethics
for Senior Financial Officers, and the charters of the Board's Audit Committee,
Nominating and Corporate Governance Committee, and Compensation (previously
named Human Resources) Committee. All of those documents are available on the
Corporation's website. To access the information at the current website address
(www.firsthorizon.com), click on "About Us," then "Investor Relations," and then
"Corporate Governance." The information is expected to be accessible in the
"Investor Relations" area of the Corporation's planned new corporate website
(www.fhnc.com). Paper copies of any of those documents are available to
shareholders upon request to the Corporate Secretary.

         The Corporation's Code of Business Conduct and Ethics includes a number
of policies and guidelines that have been in place over the years. Any waiver of
this Code for an executive officer or director will be promptly disclosed to
shareholders by posting such information on the Corporation's website.

         See Item 10 of Part III below for additional information concerning the
Corporation's Code of Ethics for Senior Financial Officers.

         The Corporation's Chief Executive Officer is required to certify
annually to the New York Stock Exchange ("NYSE") that the Chief Executive
Officer is unaware of any violation by the Corporation of NYSE corporate
governance listing standards, and this certification will be disclosed annually
(commencing in 2005) in the Corporation's annual report to shareholders or by
another method authorized by the NYSE.




                                                                               3






<PAGE>


Supervision and Regulation.

         The following summary sets forth certain of the material elements of
the regulatory framework applicable to bank holding companies and financial
holding companies and their subsidiaries and to companies engaged in securities
and insurance activities and provides certain specific information about the
Corporation. The bank regulatory framework is intended primarily for the
protection of depositors and the Federal Deposit Insurance Funds and not for the
protection of security holders. In addition, certain activities of the
Corporation and its subsidiaries are subject to various securities and insurance
laws and are regulated by the Securities and Exchange Commission and the state
insurance departments of the states in which they operate. To the extent that
the following information describes statutory and regulatory provisions, it is
qualified in its entirety by express reference to each of the particular
statutory and regulatory provisions. A change in applicable statutes,
regulations or regulatory policy may have a material effect on the business of
the Corporation.

         General

         The Corporation is a bank holding company and financial holding company
within the meaning of the Bank Holding Company Act of 1956, as amended (the
"BHCA") and is registered with the Board of Governors of the Federal Reserve
System (the "Federal Reserve"). The Corporation is subject to the regulation and
supervision of and examination by the Federal Reserve under the BHCA. The
Corporation is required to file with the Federal Reserve annual reports and such
additional information as the Federal Reserve may require pursuant to the BHCA.

         Under the BHCA, prior to March 13, 2000, bank holding companies could
not in general directly or indirectly acquire the ownership or control of more
than 5% of the voting shares or substantially all of the assets of any company,
including a bank, without the prior approval of the Federal Reserve, and a bank
holding company and its subsidiaries were generally limited to engaging in
banking and activities found by the Federal Reserve to be so closely related to
banking as to be a proper incident thereto. Since March 13, 2000, eligible bank
holding companies that elect to become financial holding companies may affiliate
with securities firms and insurance companies and engage in activities that are
"financial in nature" generally without the prior approval of the Federal
Reserve. See "Gramm-Leach-Bliley Act" below.

         In addition, the BHCA permits the Federal Reserve to approve an
application by a bank holding company to acquire a bank located outside the
acquirer's principal state of operations without regard to whether the
transaction is prohibited under state law. See "Interstate Banking and Branching
Legislation." The Tennessee Bank Structure Act of 1974, among other things,
prohibits (subject to certain exceptions) a bank holding company from acquiring
a bank for which the home state is Tennessee (a "Tennessee bank") if, upon
consummation, the company would directly or indirectly control 30% or more of
the total deposits in insured depository institutions in Tennessee. As of June
30, 2004, the Corporation estimates that it held approximately 17% of such
deposits. Subject to certain exceptions, the Tennessee Bank Structure Act
prohibits a bank holding company from acquiring a bank in Tennessee which has
been in operation for less than five years. Tennessee law permits a Tennessee
bank to establish branches in any county in Tennessee. See also "- Interstate
Banking and Branching Legislation" below.

         The Bank is a national banking association subject to regulation,
examination and supervision by the Comptroller as its primary federal regulator.
In addition, the Bank is insured by, and subject to regulation by, the Federal
Deposit Insurance Corporation (the "FDIC"). The Bank is also subject to various
requirements and restrictions under federal and state law, including
requirements to maintain reserves against deposits, restrictions on the types
and amounts of loans that may be granted and the interest that may be charged
thereon and limitations on the types of investments that may be made,




                                                                               4






<PAGE>


activities that may be engaged in, and types of services that may be offered.
Various consumer laws and regulations also affect the operations of the Bank. In
addition to the impact of regulation, commercial banks are affected
significantly by the actions of the Federal Reserve as it attempts to control
the money supply and credit availability in order to influence the economy.

         Payment of Dividends

         The Corporation is a legal entity separate and distinct from its
banking and other subsidiaries. The principal source of cash flow of the
Corporation, including cash flow to pay dividends on its stock or principal
(premium, if any) and interest on debt securities, is dividends from the Bank.
There are statutory and regulatory limitations on the payment of dividends by
the Bank to the Corporation, as well as by the Corporation to its shareholders.

         As a national bank, the Bank is required by federal law to obtain the
prior approval of the Comptroller for the payment of dividends if the total of
all dividends declared by the board of directors of the Bank in any year will
exceed the total of (i) its net profits (as defined and interpreted by
regulation) for that year plus (ii) the retained net profits (as defined and
interpreted by regulation) for the preceding two years, less any required
transfers to surplus. A national bank also can pay dividends only to the extent
that retained net profits (including the portion transferred to surplus) exceed
bad debts (as defined by regulation).

         If, in the opinion of the applicable federal bank regulatory authority,
a depository institution or a holding company is engaged in or is about to
engage in an unsafe or unsound practice (which, depending on the financial
condition of the depository institution or holding company, could include the
payment of dividends), such authority may require that such institution or
holding company cease and desist from such practice. The federal banking
agencies have indicated that paying dividends that deplete a depository
institution's or holding company's capital base to an inadequate level would be
such an unsafe and unsound banking practice. Moreover, the Federal Reserve, the
Comptroller and the FDIC have issued policy statements which provide that bank
holding companies and insured depository institutions generally should only pay
dividends out of current operating earnings.

         In addition, under the Federal Deposit Insurance Act ("FDIA"), an
FDIC-insured depository institution may not make any capital distributions
(including the payment of dividends) or pay any management fees to its holding
company or pay any dividend if it is undercapitalized or if such payment would
cause it to become undercapitalized.

         At December 31, 2004, under dividend restrictions imposed under
applicable federal laws, the Bank, without obtaining regulatory approval, could
legally declare aggregate dividends of approximately $807.6 million.

         Under Tennessee law, the Corporation is not permitted to pay dividends
if, after giving effect to such payment, it would not be able to pay its debts
as they become due in the usual course of business or the Corporation's total
assets would be less than the sum of its total liabilities plus any amounts
needed to satisfy any preferential rights if the Corporation was dissolving.

         The payment of dividends by the Corporation and the Bank may also be
affected or limited by other factors, such as the requirement to maintain
adequate capital above regulatory guidelines and debt covenants.





                                                                               5






<PAGE>


         Transactions with Affiliates

         There are various legal restrictions on the extent to which the
Corporation and its nonbank subsidiaries (including for purposes of this
paragraph, in certain situations, subsidiaries of the Bank) can borrow or
otherwise obtain credit from the Bank. There are also legal restrictions on the
Bank's purchases of or investments in the securities of and purchases of assets
from the Corporation and its nonbank subsidiaries, the Bank's loans or
extensions of credit to third parties collateralized by the securities or
obligations of the Corporation and its nonbank subsidiaries, the issuance of
guaranties, acceptances and letters of credit on behalf of the Corporation and
its nonbank subsidiaries, and certain bank transactions with the Corporation and
its nonbank subsidiaries, or with respect to which the Corporation and its
nonbank subsidiaries act as agent, participate or have a financial interest.
Subject to certain limited exceptions, the Bank (including for purposes of this
paragraph all subsidiaries of the Bank) may not extend credit to the Corporation
or to any other affiliate (other than another subsidiary bank and certain
exempted affiliates) in an amount which exceeds 10% of the Bank's capital stock
and surplus and may not extend credit in the aggregate to all such affiliates in
an amount which exceeds 20% of its capital stock and surplus. Further, there are
legal requirements as to the type, amount and quality of collateral which must
secure such extensions of credit by the Bank to the Corporation or to such other
affiliates. Also, extensions of credit and other transactions between the Bank
and the Corporation or such other affiliates must be on terms and under
circumstances, including credit standards, that are substantially the same or at
least as favorable to the Bank as those prevailing at the time for comparable
transactions with non-affiliated companies. Also, the Bank and certain of its
subsidiaries are prohibited from engaging in certain tie-in arrangements in
connection with any extension of credit, lease or sale of property, or
furnishing of services.

         Capital Adequacy

         The Federal Reserve has adopted risk-based capital guidelines for bank
holding companies. The minimum guideline for the ratio of total capital ("Total
Capital") to risk-weighted assets (including certain off-balance-sheet items,
such as standby letters of credit) is 8%, and the minimum ratio of Tier 1
Capital (defined below) to risk-weighted assets is 4%. At least half of the
Total Capital must be composed of common stock, minority interests in the equity
accounts of consolidated subsidiaries, noncumulative perpetual preferred stock
and a limited amount of cumulative perpetual preferred stock, less goodwill and
certain other intangible assets ("Tier 1 Capital"). The remainder may consist of
qualifying subordinated debt, certain types of mandatory convertible securities
and perpetual debt, other preferred stock and a limited amount of loan loss
reserves. At December 31, 2004, the Corporation's consolidated Tier 1 Capital
and Total Capital ratios were 8.62% and 13.18%, respectively.

         The Federal Reserve Board, the FDIC and the OCC have adopted rules to
incorporate market and interest-rate risk components into their risk-based
capital standards and that explicitly identify concentration of credit risk and
certain risks arising from non-traditional activities, and the management of
such risks, as important factors to consider in assessing an institution's
overall capital adequacy. Under the market risk requirements, capital is
allocated to support the amount of market risk related to a financial
institution's ongoing trading activities for banks with relatively large trading
activities. Institutions will be able to satisfy this additional requirement, in
part, by issuing short-term subordinated debt that qualifies as Tier 3 capital.
Based on present practices and activity levels, those trading related market
risk rules have no significant impact on the Corporation's regulatory capital
requirements.

         In addition, the Federal Reserve has established minimum leverage ratio
guidelines for bank holding companies. These guidelines provide for a minimum
ratio of Tier 1 Capital to quarterly average assets, less goodwill and certain
other intangible assets (the "Leverage Ratio"), of 3% for bank holding companies
that meet certain specific criteria, including having the highest regulatory
rating. All other




                                                                               6






<PAGE>


bank holding companies generally are required to maintain a Leverage Ratio of at
least 3%, plus an additional cushion of 100 to 200 basis points. The
Corporation's Leverage Ratio at December 31, 2004 was 7.16%. The guidelines also
provide that bank holding companies experiencing internal growth or making
acquisitions will be expected to maintain strong capital positions substantially
above the minimum supervisory levels without significant reliance on intangible
assets. Furthermore, the Federal Reserve has indicated that it will consider a
"tangible Tier 1 Capital leverage ratio" (deducting all intangibles) and other
indicia of capital strength in evaluating proposals for expansion or new
activities.

         The Bank is subject to risk-based and leverage capital requirements
similar to those described above adopted by the Comptroller. The Corporation
believes that the Bank was in compliance with applicable minimum capital
requirements as of December 31, 2004. Neither the Corporation nor the Bank has
been advised by any federal banking agency of any specific minimum Leverage
Ratio requirement applicable to it.

         Failure to meet capital guidelines could subject a bank to a variety of
enforcement remedies, including the termination of deposit insurance by the
FDIC, and to certain restrictions on its business and in certain circumstances
to the appointment of a conservator or receiver. See "--Prompt Corrective
Action."

         In June 1999, the Basel Committee on Banking Supervision launched its
efforts to develop an improved capital adequacy framework by issuing its
proposals to revise the 1988 Capital Accord. The new capital framework would
consist of minimum capital requirements, a supervisory review process and the
effective use of market discipline. In its proposal for minimum capital
requirements, the Committee set out options from which banks could choose
depending on the complexity of their business and the quality of their risk
management. A standardized approach would refine the current measurement
framework and introduce the use of external credit assessments to determine a
bank's capital charge. Banks with more advanced risk management capabilities
could make use of an internal risk-rating based approach. Under this approach,
some of the key elements of credit risk, such as the probability of default of
the borrower, would be estimated internally by a bank. The Committee also
proposes an explicit capital charge for operational risk to provide for problems
like internal systems failure.

         The supervisory review aspect of the new framework would seek to ensure
that a bank's capital position is consistent with its overall risk profile and
strategy. The supervisory review process would also encourage early supervisory
intervention when a bank's capital position deteriorates. The third aspect of
the new framework, market discipline, would call for detailed disclosure of a
bank's capital adequacy in order to encourage high disclosure standards and to
enhance the role of market participants in encouraging banks to hold adequate
capital. Banks would also be required to disclose how they evaluate their own
capital adequacy.

         In June, 2004, the Basel Committee issued its final framework. The U.S.
Regulators are expected to issue a Notice of Proposed Rulemaking in 2005. That
Notice is expected to require implementation of the advanced measurement methods
for large internationally active banks (core banks) and allows for other banks
to opt-in should they so choose. Under the proposed rules the Corporation would
not be considered a core bank that would be required to implement the new rules
but could evaluate whether to opt in. For those banks that do not opt in, the
current capital rules are expected to continue to apply. A final U.S. rule is
expected in 2006 with implementation expected in 2008. The Corporation cannot
predict at this time the final form the U.S. Regulators' rules will take, or the
effect they would have on the financial condition or results of operations of
the Bank or the Corporation. The Corporation intends to continue to monitor the
evolution of the proposed rulemaking and its potential impacts to the
Corporation and the industry.




                                                                               7






<PAGE>


         Holding Company Structure and Support of Subsidiary Banks

         Because the Corporation is a holding company, its right to participate
in the assets of any subsidiary upon the latter's liquidation or reorganization
will be subject to the prior claims of the subsidiary's creditors (including
depositors in the case of the Bank) except to the extent that the Corporation
may itself be a creditor with recognized claims against the subsidiary. In
addition, depositors of a bank, and the FDIC as their subrogee, would be
entitled to priority over the creditors in the event of liquidation of a bank
subsidiary.

         Under Federal Reserve policy, the Corporation is expected to act as a
source of financial strength to, and to commit resources to support, the Bank.
This support may be required at times when, absent such Federal Reserve policy,
the Corporation may not be inclined to provide it. In addition, any capital
loans by a bank holding company to any of its subsidiary banks are subordinate
in right of payment to deposits and to certain other indebtedness of such
subsidiary bank. In the event of a bank holding company's bankruptcy, any
commitment by the bank holding company to a federal bank regulatory agency to
maintain the capital of a subsidiary bank will be assumed by the bankruptcy
trustee and entitled to a priority of payment.

         Cross-Guarantee Liability

         Under the FDIA, a depository institution insured by the FDIC can be
held liable for any loss incurred by, or reasonably expected to be incurred by,
the FDIC in connection with (i) the default of a commonly controlled
FDIC-insured depository institution or (ii) any assistance provided by the FDIC
to any commonly controlled FDIC-insured depository institution "in danger of
default." "Default" is defined generally as the appointment of a conservator or
receiver and "in danger of default" is defined generally as the existence of
certain conditions indicating that a default is likely to occur in the absence
of regulatory assistance. The FDIC's claim for damages is superior to claims of
shareholders of the insured depository institution or its holding company but is
subordinate to claims of depositors, secured creditors and holders of
subordinated debt (other than affiliates) of the commonly controlled insured
depository institution. The Bank is currently the only depository institution
owned by the Corporation. In the event that the Corporation established or
acquired another depository institution, any loss suffered by the FDIC in
respect of one subsidiary bank would likely result in assertion of the
cross-guarantee provisions, the assessment of such estimated losses against the
Corporation's other subsidiary bank(s), and a potential loss of the
Corporation's investment in such subsidiary bank.

         Prompt Corrective Action

         The FDIA requires, among other things, the federal banking regulators
to take "prompt corrective action" in respect of FDIC-insured depository
institutions that do not meet minimum capital requirements. Under the FDIA,
insured depository institutions are divided into five capital tiers: "well
capitalized," "adequately capitalized," "undercapitalized," "significantly
undercapitalized" and "critically undercapitalized." Under applicable
regulations, an institution is defined to be well capitalized if it maintains a
Leverage Ratio of at least 5%, a Tier 1 Capital ratio of at least 6% and a Total
Capital ratio of at least 10% and is not subject to a directive, order or
written agreement to meet and maintain specific capital levels. An institution
is defined to be adequately capitalized if it meets all of its minimum capital
requirements as described above. An institution will be considered
undercapitalized if it fails to meet any minimum required measure, significantly
undercapitalized if it has a Total Risk-Based Capital ratio of less than 6%, a
Tier 1 Risk-Based Capital ratio of less than 3% or a Leverage Ratio of less than
3% and critically undercapitalized if it fails to maintain a level of tangible
equity equal to at least 2% of total assets. An institution may be deemed to be
in a capitalization category that is lower than is indicated by its actual
capital position if it receives an unsatisfactory examination rating.




                                                                               8






<PAGE>


         The FDIA generally prohibits an FDIC-insured depository institution
from making any capital distribution (including payment of dividends) or paying
any management fee to its holding company if the depository institution would
thereafter be undercapitalized. Undercapitalized depository institutions are
subject to restrictions on borrowing from the Federal Reserve System. In
addition, undercapitalized depository institutions are subject to growth
limitations and are required to submit capital restoration plans. An insured
depository institution's holding company must guarantee the capital plan, up to
an amount equal to the lesser of 5% of the depository institution's assets at
the time it becomes undercapitalized or the amount of the capital deficiency
when the institution fails to comply with the plan, for the plan to be accepted
by the applicable federal regulatory authority. The federal banking agencies may
not accept a capital plan without determining, among other things, that the plan
is based on realistic assumptions and is likely to succeed in restoring the
depository institution's capital. If a depository institution fails to submit an
acceptable plan, it is treated as if it is significantly undercapitalized.

         Significantly undercapitalized depository institutions may be subject
to a number of requirements and restrictions, including orders to sell
sufficient voting stock to become adequately capitalized, requirements to reduce
total assets and cessation of receipt of deposits from correspondent banks.
Critically undercapitalized depository institutions are subject to appointment
of a receiver or conservator, generally within 90 days of the date on which they
become critically undercapitalized.

         The Corporation believes that at December 31, 2004 the Bank had
sufficient capital to qualify as "well capitalized" under the regulatory capital
requirements discussed above.

         Interstate Banking and Branching Legislation

         The Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994
(the "IBBEA") authorizes interstate acquisitions of banks and bank holding
companies without geographic limitation. In addition, a bank may merge with a
bank in another state as long as neither of the states has opted out of
interstate branching prior to May 31, 1997. Tennessee did not opt out of
interstate branching. A bank may establish and operate a de novo branch in a
state in which the bank does not maintain a branch if that state explicitly
permits de novo branching. Tennessee permits de novo branching on a reciprocity
basis. Once a bank has established branches in a state through an interstate
merger transaction, the bank may establish and acquire additional branches at
any location in the state where any bank involved in the interstate merger
transaction could have established or acquired branches under applicable federal
or state law. A bank that has established a branch in a state through de novo
branching may establish and acquire additional branches in such state in the
same manner and to the same extent as a bank having a branch in such state as a
result of an interstate merger. If a state opts out of interstate branching
within the specified time period, no bank in any other state may establish a
branch in the opting out of state, whether through an acquisition or de novo.

         Gramm-Leach-Bliley Act

         The Gramm-Leach-Bliley Act repealed or modified a number of significant
provisions of then-current laws, including the Glass-Steagall Act and the Bank
Holding Company Act of 1956, which imposed restrictions on banking
organizations' ability to engage in certain types of activities. The Act
generally allows bank holding companies such as the Corporation broad authority
to engage in activities that are financial in nature or incidental to such a
financial activity, including insurance underwriting and brokerage; merchant
banking; securities underwriting, dealing and market-making; real estate
development; and such additional activities as the Federal Reserve in
consultation with the Secretary of the Treasury determines to be financial in
nature or incidental thereto. A bank holding company may engage in these
activities directly or through subsidiaries by qualifying as a "financial
holding company."




                                                                               9






<PAGE>


To qualify a bank holding company must file a declaration with the Federal
Reserve and certify that all of its subsidiary depository institutions are
well-managed and well-capitalized. The Act also permits national banks such as
the Bank to engage in certain of these activities through financial
subsidiaries. To control or hold an interest in a financial subsidiary, a
national bank must meet the following requirements: (1) the national bank must
receive approval from the Comptroller for the financial subsidiary to engage in
the activities, (2) the national bank and its depository institution affiliates
must each be well-capitalized and well-managed, (3) the aggregate consolidated
total assets of all of the national bank's financial subsidiaries must not
exceed 45% of the national bank's consolidated total assets or, if less, $50
billion, (4) the national bank must have in place adequate policies and
procedures to identify and manage financial and operational risks and to
preserve the separate identities and limited liability of the national bank and
the financial subsidiary, and (5) if the financial subsidiary will engage in
principal transactions and the national bank is one of the one hundred largest
banks, the national bank must have outstanding at least one issue of unsecured
long-term debt that is currently rated in one of the three highest investment
grade rating categories (or if in the second fifty largest banks, an alternative
requirement is that the national bank has a current long-term issuer credit
rating within the three highest investment grade rating categories). No new
financial activity may be commenced under the Act unless the national bank and
all of its depository institution affiliates have at least "satisfactory" CRA
ratings. Certain restrictions apply if the bank holding company or the national
bank fails to continue to meet one or more of the requirements listed above. In
addition, the Act contains a number of other provisions that may affect the
Bank's operations, including functional regulation of the Bank's securities and
investment management operations by the SEC and the Bank's insurance operations
by the States and limitations on the use and disclosure to third parties of
customer information. The Act generally became effective March 11, 2000,
although certain provisions took effect later, such as functional regulation
(May 12, 2001, except for certain matters), and compliance with privacy
regulations was required by July 1, 2001. The Corporation is a financial holding
company and currently, the Bank has 9 financial subsidiaries. The Corporation
cannot predict at this time the potential effect that the Act will have on its
business and operations, although the Corporation expects that the general
effect of the Act will be to increase competition in the financial services
industry generally.

         FDIC Insurance Assessments; DIFA

         The FDIC insurance premium charged on bank deposits insured by the Bank
Insurance Fund ("BIF") and on deposits insured by the Savings Association
Insurance Fund ("SAIF"), including savings association deposits acquired by
banks, ranges from 0 to 27 cents per $100 of deposits, depending on the
institution's risk classification, based on capital and supervisory risk
factors. The Deposit Insurance Funds Act of 1996 ("DIFA") provides for
assessments to be imposed on insured depository institutions with respect to
deposits insured by the BIF (in addition to any assessments imposed on
depository institutions with respect to SAIF-insured deposits) to pay for the
cost of Financing Corporation ("FICO") bonds. All banks are assessed to pay the
interest due on FICO bonds. The cost to the Corporation on an annual basis is
immaterial.

         Under the FDIA, insurance of deposits may be terminated by the FDIC
upon a finding that the institution has engaged in unsafe and unsound practices,
is in an unsafe or unsound condition to continue operations or has violated any
applicable law, regulation, rule, order or condition imposed by a federal bank
regulatory agency.

         Depositor Preference

         Federal law provides that deposits and certain claims for
administrative expenses and employee compensation against an insured depository
institution would be afforded a priority over other general




                                                                              10






<PAGE>


unsecured claims against such an institution, including federal funds and
letters of credit, in the "liquidation or other resolution" of such an
institution by any receiver.

         Securities Regulation

         Certain of the Corporation's subsidiaries are subject to various
securities laws and regulations and capital adequacy requirements promulgated by
the regulatory and exchange authorities of the jurisdictions in which they
operate.

         The Corporation's registered broker-dealer subsidiaries are subject to
the SEC's net capital rule, Rule 15c3-1. That rule requires the maintenance of
minimum net capital and limits the ability of the broker-dealer to transfer
large amounts of capital to a parent company or affiliate. Compliance with the
rule could limit operations that require intensive use of capital, such as
underwriting and trading.

         Certain of the Corporation's subsidiaries and a division of the Bank
are registered investment advisers who are regulated under the Investment
Advisers Act of 1940. Among other activities, certain of these investment
advisers provide investment advice to investment companies regulated under the
Investment Company Act of 1940. Advisory contracts with these investment
companies automatically terminate under these laws upon an assignment of the
contract by the investment adviser unless appropriate consents are obtained.
Subsidiaries of the Corporation are subject to certain restrictions in their
dealings with investment companies advised by these affiliated investment
advisers.

         Insurance Activities

         Subsidiaries of the Corporation sell various types of insurance as
agent in a number of the states. Insurance activities are subject to regulation
by the states in which such business is transacted. Although most of such
regulation focuses on insurance companies and their insurance products,
insurance agents and their activities are also subject to regulation by the
states, including, among other things, licensing and marketing and sales
practices.

Competition.

         The Corporation and its subsidiaries face substantial competition in
all aspects of the businesses in which they engage from national and state banks
located in Tennessee and large out-of-state banks as well as from savings and
loan associations, credit unions, other financial institutions, consumer finance
companies, trust companies, investment counseling firms, money market mutual
funds, insurance companies, securities firms, mortgage banking companies and
others. For certain information on the competitive position of the Corporation
and the Bank, refer to the "General" subsection above of this Item 1. Also,
refer to the subsections entitled "Supervision and Regulation" and "Effect of
Governmental Policies," both of which are relevant to an analysis of the
Corporation's competitors. Due to the intense competition in the financial
industry, the Corporation makes no representation that its competitive position
has remained constant, nor can it predict whether its position will change in
the future.

Sources and Availability of Funds.

         Specific reference is made to the Management's Discussion and Analysis
and Glossary sections, including the subsections entitled "Deposits and Other
Sources of Funds," and "Liquidity Risk Management," contained in pages 20
through 21 and pages 28 through 30 of the Corporation's 2004 Annual Report to
shareholders, which sections are incorporated herein by reference.




                                                                              11






<PAGE>


Effect of Governmental Policies.

         The Bank is affected by the policies of regulatory authorities,
including the Federal Reserve System and the Comptroller. An important function
of the Federal Reserve System is to regulate the national money supply.

         Among the instruments of monetary policy used by the Federal Reserve
are: purchases and sales of U.S. Government securities in the marketplace;
changes in the discount rate, which is the rate any depository institution must
pay to borrow from the Federal Reserve; and changes in the reserve requirements
of depository institutions. These instruments are effective in influencing
economic and monetary growth, interest rate levels and inflation.

         The monetary policies of the Federal Reserve System and other
governmental policies have had a significant effect on the operating results of
commercial banks in the past and are expected to continue to do so in the
future. Because of changing conditions in the national economy and in the money
market, as well as the result of actions by monetary and fiscal authorities, it
is not possible to predict with certainty future changes in interest rates,
deposit levels, loan demand or the business and earnings of the Corporation and
the Bank or whether the changing economic conditions will have a positive or
negative effect on operations and earnings.

         Various bills are from the time to time introduced in the United States
Congress and the Tennessee General Assembly and other state legislatures, and
regulations are proposed by the regulatory agencies which could affect the
business of the Corporation and its subsidiaries. It cannot be predicted whether
or in what form any of these proposals will be adopted or the extent to which
the business of the Corporation and its subsidiaries may be affected thereby.

Statistical Information Required by Guide 3.

         The statistical information required to be displayed under Item I
pursuant to Guide 3, "Statistical Disclosure by Bank Holding Companies," of the
Exchange Act Industry Guides is incorporated herein by reference to the
Consolidated Financial Statements and the notes thereto and the Management's
Discussion and Analysis and Glossary sections set forth at pages 3 through 52
of the Corporation's 2004 Annual Report to shareholders. Certain information not
contained in the 2004 Annual Report to shareholders, but required by Guide 3, is
contained in the tables immediately following:



                                                                              12





<PAGE>


                       FIRST HORIZON NATIONAL CORPORATION
                   ADDITIONAL GUIDE 3 STATISTICAL INFORMATION
                                 ON DECEMBER 31
                                   (Unaudited)

<TABLE>
<CAPTION>

Investment Portfolio
(Dollars in thousands)                        2004          2003            2002
- ------------------------------------------------------------------------------------
<S>                                      <C>            <C>             <C>
Mortgage-backed securities &
     collateralized mortgage
     obligations                         $ 2,391,162    $ 2,200,862     $ 2,396,530
U.S. Treasury                                 41,244         47,977          57,367
U.S. government agencies                      40,959          1,164          27,208
States and political subdivisions              8,268         14,423          28,890
Other                                        199,364        205,944         190,290
                                       --------------  -------------  --------------
                         Total           $ 2,680,997    $ 2,470,370     $ 2,700,285
                                       --------------  -------------  --------------
                                       --------------  -------------  --------------
</TABLE>

<TABLE>
<CAPTION>

Loan Portfolio
(Dollars in thousands)                   2004            2003           2002            2001          2000
- ----------------------------------------------------------------------------------------------------------------
<S>                                    <C>            <C>            <C>             <C>            <C>
Commercial:
     Commercial, financial and
         industrial                    $ 5,560,736    $ 4,502,917    $ 4,134,158     $ 4,176,738    $ 3,964,396
     Real estate commercial                960,178        968,064      1,037,341         929,036        946,903
     Real estate construction            1,208,703        690,402        551,449         492,531        415,713
Retail:
     Real estate residential             7,244,716      6,817,122      4,721,307       3,732,767      3,573,260
     Real estate construction            1,035,562        527,260        342,127         211,429        179,515
     Other retail                          168,806        212,362        286,069         459,510        840,228
     Credit card receivables               248,972        272,398        272,994         281,132        319,435
                                      -------------  -------------  -------------   -------------  -------------
                         Total        $ 16,427,673   $ 13,990,525   $ 11,345,445    $ 10,283,143   $ 10,239,450
                                      -------------  -------------  -------------   -------------  -------------
                                      -------------  -------------  -------------   -------------  -------------

</TABLE>

<TABLE>
<CAPTION>

Short-Term Borrowings
(Dollars in thousands)                 2004            2003         2002
- ----------------------------------------------------------------------------
<S>                               <C>            <C>            <C>
Federal funds purchased and
     securities sold under
     agreements to repurchase     $ 3,247,048    $ 3,079,248    $ 3,126,350
Commercial paper                       23,712         31,793         25,695
Other short-term borrowings           482,044        196,183        335,513
                                 -------------  -------------  -------------
                         Total    $ 3,752,804    $ 3,307,224    $ 3,487,558
                                 -------------  -------------  -------------
                                 -------------  -------------  -------------

</TABLE>


                                                                              13






<PAGE>

Maturities of Short-Term Purchased Funds on December 31, 2004

<TABLE>
<CAPTION>

                                         0-3           3-6          6-12        Over 12
(Dollars in thousands)                  Months        Months       Months       Months          Total
- -----------------------------------------------------------------------------------------------------------
<S>                                 <C>              <C>          <C>          <C>            <C>
Certificates of deposit
     $100,000 and more               $ 6,518,095     $ 319,171    $ 555,510    $ 823,400       $ 8,216,176
Federal funds purchased and
     securities sold under
     agreements to repurchase          3,247,048            --           --           --         3,247,048
Commercial paper and
     other short-term borrowings         495,756            --           --       10,000           505,756
- -----------------------------------------------------------------------------------------------------------
Total                               $ 10,260,899     $ 319,171    $ 555,510    $ 833,400      $ 11,968,980
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
</TABLE>


<TABLE>
<CAPTION>
Contractual Maturities of Commercial & Real Estate Construction Loans on December 31, 2004

                                                              After 1 Year
(Dollars in thousands)                     Within 1 year     Within 5 Years   After 5 Years     Total
- -----------------------------------------------------------------------------------------------------------
<S>                                        <C>               <C>             <C>               <C>
Commercial, financial and industrial         $3,274,160        $2,072,353       $214,223       $5,560,736
Real estate commercial                          361,937           488,718        109,523          960,178
Commercial real estate construction             809,100           367,291         32,312        1,208,703
Retail real estate construction               1,025,755             9,807             --        1,035,562
- -----------------------------------------------------------------------------------------------------------
Total                                        $5,470,952        $2,938,169       $356,058       $8,765,179
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
For maturities over one year:
  Interest rates - floating                                    $1,739,705       $140,683       $1,880,388
  Interest rates - fixed                                        1,198,464        215,375        1,413,839
- ------------------------------------------------------------------------------------------------------------
Total                                                          $2,938,169       $356,058       $3,294,227
- ------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------
</TABLE>


                                     ITEM 2
                                   PROPERTIES

         The Corporation has no properties that it considers materially
important to its financial statements.

                                     ITEM 3
                                LEGAL PROCEEDINGS

         The Corporation is a party to no material pending legal proceedings the
nature of which are required to be disclosed pursuant to the Instructions
contained in the Form of this Report.

                                     ITEM 4
                         SUBMISSION OF MATTERS TO A VOTE
                               OF SECURITY HOLDERS

         There were no matters submitted during the fourth quarter of 2004 to a
vote of security holders, through the solicitation of proxies or otherwise.


                                                                              14






<PAGE>

                                     ITEM 4A
                        EXECUTIVE OFFICERS OF REGISTRANT

         The following is a list of executive officers of the Corporation as of
March 1, 2005. The executive officers are elected at the April meeting of the
Corporation's Board of Directors following the annual meeting of shareholders
for a term of one year and until their successors are elected and qualified.

<TABLE>
<CAPTION>
Name and Age                         Offices and Positions (Year First Elected to Office)
- ------------                         ----------------------------------------------------
<S>                                  <C>
Gerald L. Baker                      President - First Horizon Financial Services and Executive Vice
Age: 61                              President of the Corporation and the Bank (2004)


Charles G. Burkett                   President - First Tennessee Financial Services and Executive
Age: 53                              Vice President of the Corporation and the Bank (2004)

J. Kenneth Glass                     Chairman of the Board (1/1/04), President (2001) and Chief
Age: 58                              Executive Officer (2002) of the Corporation and the Bank


John H. Hamilton                     Executive Vice President - Bank Services Group (2004)
Age: 55

Herbert H. Hilliard                  Executive Vice President, Risk Management (2001) and Government Relations and
Age: 57                              CRA (1988) of the Corporation and the Bank

Jim L. Hughes                        President - FTN Financial and Executive Vice President of the Corporation
Age: 63                              (2004) and President - FTN Financial of the Bank (1999)

Harry A. Johnson, III                Executive Vice President (1990) and General Counsel (1988) of the Corporation
Age: 56                              and the Bank

James F. Keen                        Executive Vice President (2003), Corporate Controller of the Corporation (1988)
Age: 54                              and the Bank (2001) and principal accounting officer

Larry B. Martin                      Chief Operating Officer - First Tennessee Financial Services of the Corporation
Age: 57                              and the Bank (2004)

Marlin L. Mosby, III                 Executive Vice President (2002) and Chief Financial Officer (2003) of the
Age: 41                              Corporation and the Bank

Sarah L. Meyerrose                   Executive Vice President, Corporate (2002) and Employee Services (1998) of the
Age: 49                              Corporation and the Bank

John P. O'Connor, Jr.                Executive Vice President of the Corporation (1990) and the Bank (1987) and
Age: 61                              Chief Credit Officer (1988)

Elbert L. Thomas, Jr.                Executive Vice President (1995) and Interest Rate Risk Manager (2003) of the
Age: 56                              Corporation and the Bank

</TABLE>

         Each of the executive officers has been employed by the Corporation or
its subsidiaries during each of the last five years. Mr. Baker also is President
and Chief Executive Officer of First Horizon Home Loan Corporation. Prior to
April 2004, Mr. Burkett was President - Retail Financial Services/Memphis
Financial Services, and prior to July of 2001, he was Executive Vice President,
Manager Affluent Market of the Bank. Prior to July of 2002, Mr. Glass was
President and Chief Operating Officer of the Corporation and the Bank, and prior
to July 2001, he was President-Retail Financial Services of the Corporation and
the Bank. Prior to April of 2000, Mr. Glass was Executive Vice President of the
Corporation and prior to April of 1999, he was President-Tennessee Banking Group
of the Bank.


                                                                              15






<PAGE>

Prior to April 2004, Mr. Hamilton was Executive Vice President - Product
Management and Delivery Services. Prior to June 2002, Mr. Hamilton was Executive
Vice President, Manager Bank Services Group and prior to April 2002, he was
Executive Vice President-Corporate Financial Services. Prior to April 2004, Mr.
Martin was President - Business Financial Services/Tennessee Financial Services,
and prior to July of 2001, he was Chairman and CEO - Knoxville of the Bank. From
July 2001 to July 2002, Ms. Meyerrose was also Executive Vice President, Wealth
Management. Prior to November 2003, Mr. Mosby was Executive Vice
President-Strategic Planning and Investor Relations and prior to April 2002, he
was Senior Vice President, Strategic Planning. Mr. Thomas was appointed
Executive Vice President-Interest Rate Risk Manager in October 2003 following
his return after a disability leave which commenced December 1, 2002. Prior to
December 1, 2002, Mr. Thomas was Chief Financial Officer of the Company and the
Bank. Mr. Keen was appointed Chief Financial Officer on an interim basis, from
December 1, 2002 until November 17, 2003.


                                     PART II

                                     ITEM 5
                   MARKET FOR THE REGISTRANT'S COMMON EQUITY,
                        RELATED STOCKHOLDER MATTERS, AND
                      ISSUER PURCHASES OF EQUITY SECURITIES

         (a) Market for the Corporation's Common Stock:

         The Corporation's common stock, $0.625 par value, is listed and trades
on the New York Stock Exchange, Inc. under the symbol FHN. As of December 31,
2004, there were 8,313 shareholders of record of the Corporation's common stock.
Additional information called for by this Item is incorporated herein by
reference to the Summary of Quarterly Financial Information Table (Table 25),
the Selected Financial and Operating Data Table, and the "Deposits and Other
Sources of Funds" and "Liquidity Risk Management" subsections of the
Management's Discussion and Analysis section contained in the Corporation's 2004
Annual Report to shareholders, Note 18 to the Consolidated Financial Statements
contained in the 2004 Annual Report, and to the "Payment of Dividends" and
"Transactions with Affiliates" subsections contained in Item 1 of Part I of this
Form 10-K, which are incorporated herein by reference.

         (b) Sale of Unregistered Securities:

         During 2004 the Corporation sold no equity securities without
registration under the Securities Act of 1933, as amended.

         (c)      Issuer Repurchases:

         Repurchases are made in the open market or through privately negotiated
transactions and are subject to market conditions, accumulation of excess equity
and prudent capital management. Pursuant to previously granted Board authority,
the Corporation may repurchase shares from time to time for its stock option and
other compensation plans and will evaluate the level of capital and take action
designed to generate or use capital as appropriate for the interests of the
shareholders. Additional information concerning repurchase activity during the
final three months of 2004 is presented in Table 13, and the surrounding notes
and other text, of the Management's Discussion and Analysis section appearing on
pages 22-23 of the Corporation's 2004 Annual Report to shareholders, which
information is incorporated herein by this reference.



                                                                              16





<PAGE>

                                     ITEM 6
                             SELECTED FINANCIAL DATA

         The information called for by this Item is incorporated herein by
reference to the Selected Financial and Operating Data table appearing on
page 2 of the Corporation's 2004 Annual Report to shareholders.

                                     ITEM 7
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATION

         The information called for by this Item is incorporated herein by
reference to the Management's Discussion and Analysis section, Glossary section,
and the Consolidated Historical Statements of Income and Consolidated Average
Balance Sheets and Related Yields and Rates tables appearing on pages 3-114 of
the Corporation's 2004 Annual Report to shareholders.

                                     ITEM 7A
           QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         The information called for by this Item is incorporated herein by
reference to the "Interest Rate Risk Management" subsection of Note 1 to the
Consolidated Financial Statements, and to the "Risk Management-Interest Rate
Risk Management" subsection of the Management's Discussion and Analysis section,
both of which appear, respectively, on page 66 and on pages 23-27 of the
Corporation's 2004 Annual Report to  shareholders.

                                     ITEM 8
                   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

         The information called for by this Item is incorporated herein by
reference to the Consolidated Financial Statements and the notes thereto and to
the Summary of Quarterly Financial Information table appearing, respectively, on
pages 56-111 and on page 47 of the Corporation's 2004 Annual Report to
shareholders.

                                     ITEM 9
                  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
                     ON ACCOUNTING AND FINANCIAL DISCLOSURE

         None.

                                     ITEM 9A
                             CONTROLS AND PROCEDURES

         Evaluation of Disclosure Controls and Procedures. The Corporation's
management, with the participation of the Corporation's Chief Executive Officer
and Chief Financial Officer, has evaluated the effectiveness of the design and
operation of the Corporation's disclosure controls and procedures (as defined in
Exchange Act Rule 13a-15(e)) as of the end of the period covered by the annual
report. Based on that evaluation, the Chief Executive Officer and the Chief
Financial Officer have concluded that the Corporation's disclosure controls and
procedures are effective to ensure that material information relating to the
Corporation and the Corporation's consolidated subsidiaries is made known to
such officers by others within these entities, particularly during the period
this annual report was prepared, in order to allow timely decisions regarding
required disclosure.


                                                                              17




<PAGE>


         Management's Report on Internal Control over Financial Reporting. The
report of management required by Item 308(a) of Regulation S-K, and the
attestation report required by Item 308(b) of Regulation S-K, appear at pages
53-54 of the Corporation's 2004 Annual Report to shareholders and are
incorporated herein by this reference.

         Changes in Internal Control over Financial Reporting. There have not
been any changes in the Corporation's internal control over financial reporting
during the Corporation's fourth fiscal quarter that have materially affected, or
are reasonably likely to materially affect, the Corporation's internal control
over financial reporting.

                                     ITEM 9B
                                OTHER INFORMATION

         There is no information required to have been disclosed in a report on
Form 8-K during the fourth quarter of 2004 that has not been reported.


                                    PART III

                                     ITEM 10
               DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

         The information called for by this Item as it relates to directors and
nominees for director of the Corporation, audit committee financial expert, and
members of the Audit Committee of the Corporation's Board of Directors is
incorporated herein by reference to the "Corporate Governance and Board Matters"
section and the "Election of Directors" section of the Corporation's 2005 Proxy
Statement (excluding the Audit Committee Report and the statements regarding the
independence of members of the Audit Committee). The information required by
this Item as it relates to executive officers of the Corporation is incorporated
herein by reference to Item 4A in Part I of this Report. The information
required by this Item as it relates to compliance with Section 16(a) of the
Securities Exchange Act of 1934 is incorporated herein by reference to the
"Section 16(a) Beneficial Ownership Reporting Compliance" section of the 2005
Proxy Statement.

         The Corporation's Board of Directors has adopted a Code of Ethics for
Senior Financial Officers that applies to the Chief Executive Officer, Chief
Financial Officer and Controller and also applies to all professionals serving
in the financial, accounting or audit areas of the Corporation and its
subsidiaries. A copy of the Code has been filed as Exhibit 14 to this report and
is posted on the Corporation's current internet website (www.firsthorizon.com).
(Click on "About Us," then "Investor Relations," and then "Corporate
Governance.") The Code is expected to be accessible in the "Investor Relations"
area of the Corporation's planned new corporate website (www.fhnc.com). There
have been no amendments to, or waivers from, provisions of the Code that apply
to the Chief Executive Officer, Chief Financial Officer or Controller and that
relate to elements of the Code identified in Item 406(b) of SEC Regulation S-K
since the Code was adopted, and the Corporation intends to satisfy its
disclosure obligations under Item 5.05 of Form 8-K related thereto by posting
such information on the Corporation's Internet website, the address for which is
listed above.



                                                                              18







<PAGE>


                                     ITEM 11
                             EXECUTIVE COMPENSATION

         The information called for by this Item is incorporated herein by
reference to the following sections of the Corporation's 2005 Proxy Statement:
"Compensation of Directors" and "Executive Compensation", but excluding the
sub-section captioned "Total Shareholder Return Performance Graph", which
sub-section is not "filed" with the Commission and is not incorporated into this
Form 10-K.

                                     ITEM 12
                          SECURITY OWNERSHIP OF CERTAIN
                        BENEFICIAL OWNERS AND MANAGEMENT
                         AND RELATED STOCKHOLDER MATTERS

Equity Compensation Plan Information

         The following table provides information as of December 31, 2004 with
respect to shares of First Horizon common stock that may be issued under our
existing equity compensation plans, including the 1990 Stock Option Plan (the
"1990 Plan"), the 1995 Employee Stock Option Plan (the "1995 Plan"), the 1997
Employee Stock Option Plan (the "1997 Plan"), the 2000 Employee Stock Option
Plan (the "Executive Plan"), 2003 Equity Compensation Plan, (the "2003 Plan"),
the 2000 Non-employee Directors' Deferred Compensation Stock Option Plan (the
"Directors' Plan"), the 1995 Non-employee Directors' Deferred Compensation Stock
Option Plan (the "1995 Directors' Plan"), the 1991, 1997 and 2002 Bank Director
and Advisory Board Member Deferral Plans (the "Advisory Board Plans") and the
2002 Management Incentive Plan (the "MIP"). Of the 20,432,234 options
outstanding, approximately 38 percent were issued in connection with employee
and director cash deferral elections. The Corporation received approximately
$50,887,000 in employee cash deferrals and $4,213,000 in non-employee directors
and advisory board retainer and meeting fee deferrals.

         The table includes information with respect to shares subject to
outstanding options granted under equity compensation plans that are no longer
in effect. Footnotes (4) and (5) to the table set forth the total number of
shares of First Horizon common stock issuable upon the exercise of options under
the expired plans as of December 31, 2004. No additional options may be granted
under those expired plans.


                      Equity Compensation Plan Information

<TABLE>
<CAPTION>
                                                  A                     B                          C
                                         --------------------    ----------------    ------------------------------
                                                                                          Number of Securities
                                                                                     Remaining Available for Future
                                         Number of Securities    Weighted Average        Issuance Under Equity
                                          to be Issued upon       Exercise Price           Compensation Plans
                                             Exercise of          of Outstanding         (Excluding Securities
Plan Category                            Outstanding Options          Options            Reflected in Column A)
- -------------                            -------------------          -------            ----------------------
<S>                                          <C>                     <C>                       <C>
Equity Compensation Plans Approved by
   Shareowners(1).....................        4,738,586 (4)           $  29.58                  3,687,648 (2)
Equity Compensation Plans Not
   Approved by Shareowners(3).........       15,693,648 (5)           $  32.35                    848,049
                                             ----------                                         ---------
Total*................................       21,267,851 (6)           $  31.71                  4,687,159 (7)
</TABLE>

   * "Total" exceeds sum of column elements as explained in notes (6) and (7).

(1)  Consists of the Executive Plan, Directors' Plan, 1995 Directors' Plan, 1995
     Plan, 1990 Plan, the 2003 Plan and the MIP.

                                                                              19





<PAGE>


(2)  Includes shares available for future issuance under the MIP and an
     additional 1,000,000 shares under the 2003 Plan approved by shareholders in
     2004. As of December 31, 2004, an aggregate of 200,000 shares of First
     Horizon common stock were available for issuance under the MIP. As of
     December 31, 2004, an aggregate of 1,076,712 shares were available for
     restricted stock grants under the 2003 Plan.

(3)  Consists of the 1997 Plan and the Advisory Board Plans.

(4)  Includes 1,303,070 outstanding options issued in connection with employee
     and non-employee director cash deferrals of approximately $9,600,000. Also
     includes information for equity compensation plans that have expired. The
     Directors' Plan and the 1990 Plan were approved by shareholders in 1995 and
     1990, respectively. The plans expired June 1999 and April 2000. As of
     December 31, 2004, a total of 640,990 shares of First Horizon common stock
     were issuable upon the exercise of outstanding options under these expired
     plans. No additional options may be granted under these expired plans.

(5)  Includes 6,527,221 outstanding options issued in connection with employee
     and advisory board cash deferrals of approximately $45,500,000. Also
     includes information for equity compensation plans that have expired. The
     1997 Bank Director and Advisory Board Member Deferral Plan and the 1991
     Bank Director and Advisory Board Member Deferral Plan expired in January
     2002 and January 1997, respectively. As of December 31, 2004, a total of
     99,270 shares of First Horizon common stock were issuable upon the exercise
     of outstanding options under the expired plans. No additional options may
     be granted under these expired plans.

(6)  Includes 835,617 shares of First Horizon common stock to be issued at the
     end of specified deferral periods set forth in individual deferral
     agreements.

(7)  Includes 151,462 shares of First Horizon common stock underlying restricted
     stock units granted under the 1992 Restricted Stock Plan.

Description of Equity Compensation Plans Not Approved by Shareholders

         The 1997 Plan. The 1997 Plan was adopted by the Board of Directors on
April 16, 1996 and will expire in April 2006. The 1997 Plan provides for
granting of nonqualified stock options.

         Options granted under the 1997 Plan have been granted to all employees
of the Corporation under our FirstShare and management option programs. The
FirstShare program is a broad-based employee plan, where all employees of the
Corporation receive a stock option award annually, except for management level
employees who receive annual stock option awards under the management option
program. The FirstShare options vest 100 percent after three years and have a
term of 10 years. The management options vest 50 percent after 3 years and 50
percent after 4 years, unless a specified stock price is achieved within the 3
year period. The management options have a term of 7 years.

         In addition to the above, certain employees could elect to defer a
portion of their annual compensation into stock options. These options vest
after 6 months and have a term of 20 years for grants made prior to February
2004. The options vest on an accelerated basis in the event of a change in
control of First Horizon. All options granted under the 1997 Plan have an
exercise price equal to the fair market value on the date of grant.
Notwithstanding the above, the option price per share could have been less
than 100 percent of the fair market value of the share at the time the
option was granted if the employee entered into an agreement with the
Corporation to receive a stock option grant in lieu of compensation and the
amount of compensation foregone when added to the cash exercise price of the
options equaled at least the fair market value of the shares on the date of
grant. In January 2005, the Compensation Committee of the Board of Directors
terminated the employee option deferral program; however, previously granted
deferral options were unaffected by that termination.

                                                                              20





<PAGE>


         As of December 31, 2004, options covering 15,572,848 shares of First
Horizon common stock were outstanding under the 1997 Plan, 672,397 shares
remained available for future option grants, and options covering 2,106,581
shares had been exercised during the year. Of the options outstanding,
approximately 41 percent were issued in connection with employee cash deferral
elections. The Corporation received approximately $44,020,000 in cash deferrals
to offset a portion of the exercise price. Of the 672,397 shares remaining
available for future option grants, approximately all are expected to be
granted with an option term of 10 years or less.

         The 1997 Plan has been filed as Exhibit 10(c) in the Corporation's Form
10-Q for the quarter ended September 30, 2002.

         The Advisory Board Plans. The Advisory Board Plans were adopted by the
Board of Directors in October 2001, January 1997 and January 1991. The 2002
Advisory Board Plan will expire on January 1, 2007 and the 1997 and 1991 plans
expired in 2002 and 1997, respectively. The 2002 Advisory Board Plan provides
granting of nonqualified stock options to bank regional and advisory board
members who choose to forego board fees and retainers in exchange for stock
options on shares of the Corporation's common stock.

         Options granted under the Advisory Board Plans are granted only to
regional and advisory board members who are not employees. The options are
granted in lieu of the participants receiving retainers or attendance fees for
bank board and advisory board meetings. The number of shares subject to grant
will be the amount of fees/retainers earned divided by one half of the fair
market value of one share of common stock on the date of option grant. The
exercise price plus the amount of fees foregone will equal the fair market value
of the stock on the date of the grant. The options vest after 6 months and have
a term of 20 years for grants made prior to February 2004, and a term of 10
years for grants made subsequent to January 2004. In January 2005, the
Compensation Committee approved the termination of the deferral stock option
program generally; as a consequence of that action, it is anticipated that the
2002 Advisory Board Plan will be terminated by formal Board action in 2005.

         As of December 31, 2004, options covering 120,800 shares of First
Horizon common stock were outstanding under the Advisory Board Plans, 175,652
shares remained available for future option grants, and options covering 14,025
shares had been exercised during the year.

         The Advisory Board Plans have been filed as Exhibit 10(s) to the
Corporation's Form 10-Q for the quarter ended June 30, 2004, and Exhibits 10(t)
and 10(u) to the Corporation's Form 10-K for the year 2002.

Beneficial Ownership of Corporation Stock

         The information required by this Item pursuant to Item 403(a) and (b)
of Regulation S-K is incorporated herein by reference to the "Stock Ownership
Information and Table" section of the Corporation's 2005 Proxy Statement.

Change in Control Arrangements

         The Corporation is unaware of any arrangements which may result in a
change in control of the Corporation.

                                     ITEM 13
                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         The information called for by this Item is incorporated herein by
reference to the "Certain Relationships and Related Transactions" section of the
2005 Proxy Statement.

                                                                              21





<PAGE>


                                     ITEM 14
                     PRINCIPAL ACCOUNTANT FEES AND SERVICES

         The Audit Committee of the Board of Directors has adopted an Audit and
Non-Audit Services Pre-Approval Policy, a copy of which is set forth as part of
Appendix B to the Corporation's 2005 Proxy Statement (pages B-6 - B-8) and is
incorporated herein by reference.

         Information regarding fees billed to the Corporation by KPMG LLC for
the two most recent fiscal years is incorporated herein by reference to the
"Vote Item No. 2"section of the 2005 Proxy Statement. No services were approved
by the Audit Committee pursuant to Rule 2-01(c)(7)(i)(c) of Regulation S-X.


                                     PART IV

                                     ITEM 15
                   EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

    The following documents are filed as a part of this Report:

Financial Statements:

       Page 56*         1. Consolidated Statements of Condition as of
                            December 31, 2004 and 2003.

       Page 57*         2. Consolidated Statements of Income for the years
                            ended December 31, 2004, 2003 and 2002.

       Page 58*         3. Consolidated Statements of Shareholders' Equity for
                            the years ended December 31, 2004, 2003, and 2002.

       Page 59*         4. Consolidated Statements of Cash Flows for the years
                            ended December 31, 2004, 2003 and 2002.

       Pages 60-111*    5. Notes to the Consolidated Financial Statements

       Pages 54-55*     6. Reports of Independent Registered Public Accounting
                            Firm

       *The consolidated financial statements of the Corporation, the notes
       thereto, and the reports of independent public accountants, as listed
       above, are incorporated herein by reference to the indicated pages of the
       Corporation's 2004 Annual Report to shareholders.

Financial Statement Schedules: Not applicable.

Exhibits:

       Exhibits marked with an "*" represent a management contract or
       compensatory plan or arrangement required to be identified and filed as
       an exhibit.

       Exhibits marked with a "+" are filed herewith.

                                                                              22





<PAGE>


3.1         Amended and Restated Charter of the Corporation, incorporated herein
            by reference to Exhibit 3(i) to the Corporation's Quarterly Report
            on Form 10-Q for the quarter ended 3-31-04.

3.2+        Bylaws of the Corporation, as amended and restated as of 1-18-05.

4.1         Shareholder Protection Rights Agreement, dated as of October 20,
            1998, between the Corporation and First Tennessee Bank National
            Association, as Rights Agent, including as Exhibit A the forms of
            Rights Certificate and Election to Exercise and as Exhibit B the
            form of Articles of Amendment designating Participating Preferred
            Stock, incorporated herein by reference to Exhibits 1, 2, and 3 to
            the Corporation's Registration Statement on Form 8-A filed 10-23-98.

4.2         The Corporation and certain of its consolidated subsidiaries have
            outstanding certain long-term debt. See Note 10 in the Corporation's
            2004 Annual Report to shareholders. At December 31, 2004, none of
            such debt exceeded 10% of the total assets of the Corporation and
            its consolidated subsidiaries. Thus, copies of constituent
            instruments defining the rights of holders of such debt are not
            required to be included as exhibits. The Corporation agrees to
            furnish copies of such instruments to the Securities and Exchange
            Commission upon request.

4.3         Three principal agreements related to a note program for First
            Tennessee Bank National Association (the "Bank"): (i) form of
            Distribution Agreement dated February 18, 2005 among the registrant,
            the Bank, and the agents therein named; (ii) form of Fiscal and
            Paying Agency Agreement dated as of February 18, 2005 between the
            Bank and JPMorgan Chase Bank, National Association; and (iii) form
            of Interest Calculation Agreement dated as of February 18, 2005
            between the Bank and JPMorgan Chase Bank, National Association. All
            such agreements are incorporated herein by reference to Exhibit 4(c)
            to the Corporation's Current Report on Form 8-K filed February 25,
            2005.

         *Deferral Plans and Related Exhibits

*10.1(a)    Directors and Executives Deferred Compensation Plan, as amended and
            restated, incorporated herein by reference to Exhibit 10(h) to the
            Corporation's Quarterly Report on Form 10-Q for the quarter ended
            6-30-03 and form of individual agreement, incorporated herein by
            reference to Exhibit 10(h) to the Corporation's 1996 Annual report
            on Form 10-K.

*10.1(b)    Director Deferral Agreements with schedule, incorporated herein by
            reference to Exhibit 10(k) to the Corporation's 1992 Annual Report
            on Form 10-K and Exhibit 10(j) to the Corporation's 1995 Annual
            Report on Form 10-K.

*10.1(c)    First Tennessee National Corporation Nonqualified Deferred
            Compensation Plan, incorporated herein by reference to Exhibit 10(a)
            to the Corporation's 2003 Annual Report on Form 10-K.

*10.1(d)    Non-Employee Directors' Deferred Compensation Stock Option Plan, as
            amended and restated, incorporated herein by reference to Exhibit
            10(m) to the Corporation's 1997 Annual Report on Form 10-K.

*10.1(e)    2000 Non-Employee Directors' Deferred Compensation Stock Option
            Plan, as amended and restated 4-20-04, incorporated herein by
            reference to Exhibit 10(n) to the Corporation's Quarterly Report on
            Form 10-Q for the quarter ended 6-30-04.

                                                                              23





<PAGE>


*10.1(f)    [1991] Bank Advisory Director Deferral Plan, incorporated herein by
            reference to Exhibit 10(u) to the Corporation's 2002 Annual Report
            on Form 10-K.

*10.1(g)    [1997] Bank Director and Advisory Board Member Deferral Plan,
            incorporated herein by reference to Exhibit 10(t) to the
            Corporation's 2002 Annual Report on Form 10-K.

*10.1(h)    2002 Bank Director and Advisory Board Member Deferral Plan, as
            amended and restated 4-20-04, incorporated herein by reference to
            Exhibit 10(s) to the Corporation's Quarterly Report on Form 10-Q for
            the quarter ended 6-30-04.

*10.1(i)    First Horizon Nonqualified Deferred Compensation Plan, incorporated
            herein by reference to Exhibit 4(c) to the Corporation's
            Registration Statement on Form S-8 (No. 333-106015), filed June 11,
            2003.

*10.1(j)    FTN Financial Deferred Compensation Plan, incorporated herein by
            reference to Exhibit 4.3 to the Corporation's Registration Statement
            on Form S-8 (No. 333-110845), filed December 1, 2003.

*10.1(k)    Form of Deferred Compensation Agreement used under the registrant's
            2003 Equity Compensation Plan and First Tennessee National
            Corporation Non-Qualified Deferred Compensation Plan, along with
            form of Salary, Commission, and Annual Bonus Deferral Programs
            Overview, form of Deferred Stock Option ("DSO") Program Summary, and
            description of share receipt deferral feature, incorporated herein
            by reference to Exhibit 10(z) to the Corporation's Current Report on
            Form 8-K dated January 3, 2005.

         *Stock-Based Incentive Plans

*10.2(a)    1990 Stock Option Plan, as amended, and 1-21-97, 10-22-97, and
            10-18-00 amendments, incorporated herein by reference to Exhibit
            10(f) to the Corporation's 1992, 1996, 1997 and 2000 Annual Reports
            on Form 10-K.

*10.2(b)    1992 Restricted Stock Incentive Plan, as amended and restated,
            incorporated herein by reference to Exhibit 10(d) to the
            Corporation's Quarterly Report on Form 10-Q for the quarter ended
            3-31-99.

*10.2(c)    1995 Employee Stock Option Plan, as amended and restated,
            incorporated herein by reference to Exhibit 10(l) to the
            Corporation's 2000 Annual Report on Form 10-K.

*10.2(d)    1997 Employee Stock Option Plan, as amended and restated,
            incorporated herein by reference to Exhibit 10(c) to the
            Corporation's Quarterly Report on Form 10-Q for the quarter ended
            9-30-02.

*10.2(e)    2000 Employee Stock Option Plan, as amended and restated,
            incorporated herein by reference to Exhibit 10(b) to the
            Corporation's 2000 Annual Report on Form 10-K.

                                                                              24





<PAGE>


*10.2(f)    2003 Equity Compensation Plan, incorporated herein by reference to
            Appendix A to the Corporation's Proxy Statement furnished to
            shareholders in connection with the annual meeting held on April 20,
            2004, filed March 10, 2004.

         *TARSAP/PARSAP Restricted Stock Agreements and Related Documents

*10.3(a)+   Form of accelerated (performance based) Restricted Stock
            Agreement under the 1992 Restricted Stock Incentive Plan

*10.3(b)+   Form of accelerated (performance based) Restricted Stock
            Agreement under the 2003 Equity Compensation Plan

*10.3(c)+   Description of performance criteria related to TARSAP/PARSAP
            awards granted prior to 2005

         *LTIP Documents

*10.4(a)+   Form of Notice of 2003 LTIP award under the 2003 Equity Compensation
            Plan, with form of related Restricted Stock Agreement. Messrs.
            Burkett, Hughes, and Baker are the executive officers whose bonuses
            are based on a measure of business unit earnings, as described in
            the bracketed text in Section 5.0 of the Notice and in Exhibit A
            to the Restricted Stock Agreement; however, Messrs. Hughes and Baker
            received no Restricted Stock Agreement in connection with their 2003
            LTIP awards.

*10.4(b)+   Form of Notice of 2004 LTIP award under the 2003 Equity Compensation
            Plan. Messrs. Burkett, Hughes, and Baker are the executive officers
            whose bonuses are based on a measure of business unit earnings, as
            described in the bracketed text in Section 5.0 of the Notice.

*10.4(c)+   Form of Notice of 2005 LTIP award under the 2003 Equity Compensation
            Plan. Messrs. Burkett, Hughes, Baker, and Martin are the executive
            officers whose bonuses are based on a measure of business unit
            earnings, as noted in the exhibit.

         *Other Stock-Based Incentive Plan Agreements and Related Documents

*10.5(a)    Form of Restricted Stock Agreement for Non-Employee Director used
            under the 2003 Equity Compensation Plan, incorporated herein by
            reference to Exhibit 10(aa) to the Corporation's Current Report on
            Form 8-K dated January 18, 2005.

*10.5(b)+   April 2003 Restricted Stock Agreement under the 2003 Equity
            Compensation Plan with J. Kenneth Glass.

*10.5(c)+   Form of Agreement To Defer Receipt Of Shares Following Option
            Exercise.

*10.5(d)+   Form of Agreement to Exchange Shares for RSUs and Defer Receipt of
            Shares [relating to Restricted Stock]

*10.5(e)+   Form of Stock Option Grant Notice

*10.5(f)+   Form of Stock Option Reload Grant Notification

         *Management Cash Incentive Plan Documents

*10.6(a)    2002 Management Incentive Plan, incorporated herein by reference to
            Exhibit 10(q) to the Corporation's 2001 Annual Report on Form 10-K.

*10.6(b)    Description of target payouts and performance criteria approved for
            2005 annual cash bonuses to executive officers under the 2002
            Management Incentive Plan, incorporated

                                                                              25





<PAGE>


            herein by reference to the third paragraph under the caption "Salary
            and Annual Bonus Action" reported under Item 1.01 of the
            Corporation's Current Report on Form 8-K filed February 28, 2005.

         Other Material Contract Exhibits

*10.7       Form of Severance Agreements dated 1-28-97, incorporated herein by
            reference to Exhibit 10(k) to the Corporation's 1996 Annual Report
            on Form 10-K.

*10.8       Survivor Benefits Plan, as amended and restated, incorporated herein
            by reference to Exhibit 10(g) to the Corporation's Quarterly Report
            on Form 10-Q for the quarter ended 9-30-03.

*10.9       Non-employee Director Benefits, incorporated herein by reference to
            Exhibit 10(p) to the Corporation's 2003 Annual Report on Form 10-K.
            The benefit described in this exhibit relating to the possible
            repurchase of shares of the Corporation's common stock is available
            to the Corporation's executive officers as well as to its directors.

*10.10      Long-Term Disability Program, incorporated herein by reference to
            Exhibit 10(v) to the Corporation's 2003 Annual Report on Form 10-K.

*10.11      Amended and Restated Pension Restoration Plan, as amended and
            restated 4-20-04, incorporated herein by reference to Exhibit 10(i)
            to the Corporation's Quarterly Report on Form 10-Q for the quarter
            ended 6-30-04.

*10.12      Jim L. Hughes employment agreement, incorporated herein by reference
            to Exhibit 10(w) to the Corporation's Quarterly Report on Form 10-Q
            for the quarter ended 6-30-04.

*10.13+     Form of Indemnity Agreement between the Corporation and its
            directors and executive officers.

*10.14      Description of salaries approved for executive officers for 2005,
            incorporated herein by reference to the first paragraph under the
            caption "Salary and Annual Bonus Action" reported under Item 1.01 of
            the Corporation's Current Report on Form 8-K filed February 28,
            2005.

13+         Pages 2 through 114 of the First Horizon National Corporation 2004
            Annual Report to shareholders, a copy of which is furnished for the
            information of the Securities and Exchange Commission. Portions of
            the Annual Report not incorporated herein by reference are deemed
            not to be "filed" with the Commission.

14          Code of Ethics for Senior Financial Officers, incorporated herein by
            reference to Exhibit 14 to the Corporation's 2003 Annual Report on
            Form 10-K

21+         Subsidiaries of the Corporation.

23+         Accountant's Consents.

24+         Powers of Attorney.

                                                                              26





<PAGE>


31(a)+      Rule 13a-14(a) Certifications of CEO (pursuant to Section 302 of
            Sarbanes-Oxley Act of 2002)

31(b)+      Rule 13a-14(a) Certifications of CFO (pursuant to Section 302 of
            Sarbanes-Oxley Act of 2002)

32(a)+      18 USC 1350 Certifications of CEO (pursuant to Section 906 of
            Sarbanes-Oxley Act of 2002)

32(b)+      18 USC 1350 Certifications of CFO (pursuant to Section 906 of
            Sarbanes-Oxley Act of 2002)


                                                                              27





<PAGE>


         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                 FIRST HORIZON NATIONAL CORPORATION

Date:  March 11, 2005           By:  /s/ Marlin L. Mosby, III
                                     -----------------------
                                 Marlin L. Mosby, III, Executive Vice President,
                                 and Chief Financial Officer

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
         Signature                                   Title                                   Date
         ---------                                   -----                                   ----
<S>                                        <C>                                          <C>
J. Kenneth Glass*                          Chairman of the Board, President,            March 11, 2005
- --------------------------                 Chief Executive Officer
J. Kenneth Glass                           and a Director (principal executive
                                           officer)

Marlin L. Mosby, III*                      Executive Vice President and Chief           March 11, 2005
- ---------------------------                Financial Officer (principal
Marlin L. Mosby, III                       financial officer)


James F. Keen*                             Executive Vice President and                 March 11, 2005
- ----------------------------               Corporate Controller (principal
James F. Keen                              accounting officer)

Robert C. Blattberg*                       Director                                     March 11, 2005
- --------------------------
Robert C. Blattberg

                                           Director
- --------------------------
George E. Cates

Simon F. Cooper*                           Director                                     March 11, 2005
- -------------------------
Simon F. Cooper

James A. Haslam, III*                      Director                                     March 11, 2005
- ------------------------
James A. Haslam, III

R. Brad Martin*                            Director                                     March 11, 2005
- --------------------------
R. Brad Martin

Vicki R. Palmer *                          Director                                     March 11, 2005
- -------------------------
Vicki R. Palmer

Michael D. Rose*                           Director                                     March 11, 2005
- ------------------------
Michael D. Rose

Mary F. Sammons*                           Director                                     March 11, 2005
- -----------------------
Mary F. Sammons
</TABLE>

                                                                              28





<PAGE>


<TABLE>
<S>                                        <C>                                          <C>
William B. Sansom*                         Director                                     March 11, 2005
- -----------------------
William B. Sansom

Jonathan P. Ward*                          Director                                     March 11, 2005
- ------------------------
Jonathan P. Ward

Luke Yancy III*                            Director                                     March 11, 2005
- ------------------------
Luke Yancy III


*By:  /s/ Clyde A. Billings, Jr.                                                        March 11, 2005
      -------------------------------
         Clyde A. Billings, Jr.
         As Attorney-in-Fact
</TABLE>





                                                                              29





<PAGE>



                                  EXHIBIT INDEX

       Exhibits marked with an "*" represent a management contract or
       compensatory plan or arrangement required to be identified and filed as
       an exhibit.

       Exhibits marked with a "+" are filed herewith.


3.1         Amended and Restated Charter of the Corporation, incorporated herein
            by reference to Exhibit 3(i) to the Corporation's Quarterly Report
            on Form 10-Q for the quarter ended 3-31-04.

3.2+        Bylaws of the Corporation, as amended and restated as of 1-18-05.

4.1         Shareholder Protection Rights Agreement, dated as of October 20,
            1998, between the Corporation and First Tennessee Bank National
            Association, as Rights Agent, including as Exhibit A the forms of
            Rights Certificate and Election to Exercise and as Exhibit B the
            form of Articles of Amendment designating Participating Preferred
            Stock, incorporated herein by reference to Exhibits 1, 2, and 3 to
            the Corporation's Registration Statement on Form 8-A filed 10-23-98.

4.2         The Corporation and certain of its consolidated subsidiaries have
            outstanding certain long-term debt. See Note 10 in the Corporation's
            2004 Annual Report to shareholders. At December 31, 2004, none of
            such debt exceeded 10% of the total assets of the Corporation and
            its consolidated subsidiaries. Thus, copies of constituent
            instruments defining the rights of holders of such debt are not
            required to be included as exhibits. The Corporation agrees to
            furnish copies of such instruments to the Securities and Exchange
            Commission upon request.

4.3         Three principal agreements related to a note program for First
            Tennessee Bank National Association (the "Bank"): (i) form of
            Distribution Agreement dated February 18, 2005 among the registrant,
            the Bank, and the agents therein named; (ii) form of Fiscal and
            Paying Agency Agreement dated as of February 18, 2005 between the
            Bank and JPMorgan Chase Bank, National Association; and (iii) form
            of Interest Calculation Agreement dated as of February 18, 2005
            between the Bank and JPMorgan Chase Bank, National Association. All
            such agreements are incorporated herein by reference to Exhibit 4(c)
            to the Corporation's Current Report on Form 8-K filed February 25,
            2005.

         *Deferral Plans and Related Exhibits

*10.1(a)    Directors and Executives Deferred Compensation Plan, as amended and
            restated, incorporated herein by reference to Exhibit 10(h) to the
            Corporation's Quarterly Report on Form 10-Q for the quarter ended
            6-30-03 and form of individual agreement, incorporated herein by
            reference to Exhibit 10(h) to the Corporation's 1996 Annual report
            on Form 10-K.

*10.1(b)    Director Deferral Agreements with schedule, incorporated herein by
            reference to Exhibit 10(k) to the Corporation's 1992 Annual Report
            on Form 10-K and Exhibit 10(j) to the Corporation's 1995 Annual
            Report on Form 10-K.

*10.1(c)    First Tennessee National Corporation Nonqualified Deferred
            Compensation Plan, incorporated herein by reference to Exhibit 10(a)
            to the Corporation's 2003 Annual Report on Form 10-K.

*10.1(d)    Non-Employee Directors' Deferred Compensation Stock Option Plan, as
            amended and restated, incorporated herein by reference to Exhibit
            10(m) to the Corporation's 1997 Annual Report on Form 10-K.

*10.1(e)    2000 Non-Employee Directors' Deferred Compensation Stock Option
            Plan, as amended and restated 4-20-04, incorporated herein by
            reference to Exhibit 10(n) to the Corporation's Quarterly Report on
            Form 10-Q for the quarter ended 6-30-04.







<PAGE>


*10.1(f)    [1991] Bank Advisory Director Deferral Plan, incorporated herein by
            reference to Exhibit 10(u) to the Corporation's 2002 Annual Report
            on Form 10-K.

*10.1(g)    [1997] Bank Director and Advisory Board Member Deferral Plan,
            incorporated herein by reference to Exhibit 10(t) to the
            Corporation's 2002 Annual Report on Form 10-K.

*10.1(h)    2002 Bank Director and Advisory Board Member Deferral Plan, as
            amended and restated 4-20-04, incorporated herein by reference to
            Exhibit 10(s) to the Corporation's Quarterly Report on Form 10-Q for
            the quarter ended 6-30-04.

*10.1(i)    First Horizon Nonqualified Deferred Compensation Plan, incorporated
            herein by reference to Exhibit 4(c) to the Corporation's
            Registration Statement on Form S-8 (No. 333-106015), filed June 11,
            2003.

*10.1(j)    FTN Financial Deferred Compensation Plan, incorporated herein by
            reference to Exhibit 4.3 to the Corporation's Registration Statement
            on Form S-8 (No. 333-110845), filed December 1, 2003.

*10.1(k)    Form of Deferred Compensation Agreement used under the registrant's
            2003 Equity Compensation Plan and First Tennessee National
            Corporation Non-Qualified Deferred Compensation Plan, along with
            form of Salary, Commission, and Annual Bonus Deferral Programs
            Overview, form of Deferred Stock Option ("DSO") Program Summary, and
            description of share receipt deferral feature, incorporated herein
            by reference to Exhibit 10(z) to the Corporation's Current Report on
            Form 8-K dated January 3, 2005.

         *Stock-Based Incentive Plans

*10.2(a)    1990 Stock Option Plan, as amended, and 1-21-97, 10-22-97, and
            10-18-00 amendments, incorporated herein by reference to Exhibit
            10(f) to the Corporation's 1992, 1996, 1997 and 2000 Annual Reports
            on Form 10-K.

*10.2(b)    1992 Restricted Stock Incentive Plan, as amended and restated,
            incorporated herein by reference to Exhibit 10(d) to the
            Corporation's Quarterly Report on Form 10-Q for the quarter ended
            3-31-99.

*10.2(c)    1995 Employee Stock Option Plan, as amended and restated,
            incorporated herein by reference to Exhibit 10(l) to the
            Corporation's 2000 Annual Report on Form 10-K.

*10.2(d)    1997 Employee Stock Option Plan, as amended and restated,
            incorporated herein by reference to Exhibit 10(c) to the
            Corporation's Quarterly Report on Form 10-Q for the quarter ended
            9-30-02.

*10.2(e)    2000 Employee Stock Option Plan, as amended and restated,
            incorporated herein by reference to Exhibit 10(b) to the
            Corporation's 2000 Annual Report on Form 10-K.







<PAGE>


*10.2(f)    2003 Equity Compensation Plan, incorporated herein by reference to
            Appendix A to the Corporation's Proxy Statement furnished to
            shareholders in connection with the annual meeting held on April 20,
            2004, filed March 10, 2004.

         *TARSAP/PARSAP Restricted Stock Agreements and Related Documents

*10.3(a)+   Form of accelerated (performance based) Restricted Stock
            Agreement under the 1992 Restricted Stock Incentive Plan

*10.3(b)+   Form of accelerated (performance based) Restricted Stock
            Agreement under the 2003 Equity Compensation Plan

*10.3(c)+   Description of performance criteria related to TARSAP/PARSAP
            awards granted prior to 2005

         *LTIP Documents

*10.4(a)+   Form of Notice of 2003 LTIP award under the 2003 Equity Compensation
            Plan, with form of related Restricted Stock Agreement. Messrs.
            Burkett, Hughes, and Baker are the executive officers whose bonuses
            are based on a measure of business unit earnings, as described in
            the bracketed text in Section 5.0 of the Notice and in Exhibit A
            to the Restricted Stock Agreement; however, Messrs. Hughes and Baker
            received no Restricted Stock Agreement in connection with their 2003
            LTIP awards.

*10.4(b)+   Form of Notice of 2004 LTIP award under the 2003 Equity Compensation
            Plan. Messrs. Burkett, Hughes, and Baker are the executive officers
            whose bonuses are based on a measure of business unit earnings, as
            described in the bracketed text in Section 5.0 of the Notice.

*10.4(c)+   Form of Notice of 2005 LTIP award under the 2003 Equity Compensation
            Plan. Messrs. Burkett, Hughes, Baker, and Martin are the executive
            officers whose bonuses are based on a measure of business unit
            earnings, as noted in the exhibit.

         *Other Stock-Based Incentive Plan Agreements and Related Documents

*10.5(a)    Form of Restricted Stock Agreement for Non-Employee Director used
            under the 2003 Equity Compensation Plan, incorporated herein by
            reference to Exhibit 10(aa) to the Corporation's Current Report on
            Form 8-K dated January 18, 2005.

*10.5(b)+   April 2003 Restricted Stock Agreement under the 2003 Equity
            Compensation Plan with J. Kenneth Glass.

*10.5(c)+   Form of Agreement To Defer Receipt Of Shares Following Option
            Exercise.

*10.5(d)+   Form of Agreement to Exchange Shares for RSUs and Defer Receipt of
            Shares [relating to Restricted Stock]

*10.5(e)+   Form of Stock Option Grant Notice

*10.5(f)+   Form of Stock Option Reload Grant Notification

         *Management Cash Incentive Plan Documents

*10.6(a)    2002 Management Incentive Plan, incorporated herein by reference to
            Exhibit 10(q) to the Corporation's 2001 Annual Report on Form 10-K.

*10.6(b)    Description of target payouts and performance criteria approved for
            2005 annual cash bonuses to executive officers under the 2002
            Management Incentive Plan, incorporated






<PAGE>


            herein by reference to the third paragraph under the caption "Salary
            and Annual Bonus Action" reported under Item 1.01 of the
            Corporation's Current Report on Form 8-K filed February 28, 2005.

         Other Material Contract Exhibits

*10.7       Form of Severance Agreements dated 1-28-97, incorporated herein by
            reference to Exhibit 10(k) to the Corporation's 1996 Annual Report
            on Form 10-K.

*10.8       Survivor Benefits Plan, as amended and restated, incorporated herein
            by reference to Exhibit 10(g) to the Corporation's Quarterly Report
            on Form 10-Q for the quarter ended 9-30-03.

*10.9       Non-employee Director Benefits, incorporated herein by reference to
            Exhibit 10(p) to the Corporation's 2003 Annual Report on Form 10-K.
            The benefit described in this exhibit relating to the possible
            repurchase of shares of the Corporation's common stock is available
            to the Corporation's executive officers as well as to its directors.

*10.10      Long-Term Disability Program, incorporated herein by reference to
            Exhibit 10(v) to the Corporation's 2003 Annual Report on Form 10-K.

*10.11      Amended and Restated Pension Restoration Plan, as amended and
            restated 4-20-04, incorporated herein by reference to Exhibit 10(i)
            to the Corporation's Quarterly Report on Form 10-Q for the quarter
            ended 6-30-04.

*10.12      Jim L. Hughes employment agreement, incorporated herein by reference
            to Exhibit 10(w) to the Corporation's Quarterly Report on Form 10-Q
            for the quarter ended 6-30-04.

*10.13+     Form of Indemnity Agreement between the Corporation and its
            directors and executive officers.

*10.14      Description of salaries approved for executive officers for 2005,
            incorporated herein by reference to the first paragraph under the
            caption "Salary and Annual Bonus Action" reported under Item 1.01 of
            the Corporation's Current Report on Form 8-K filed February 28,
            2005.

13+         Pages 2 through 114 of the First Horizon National Corporation 2004
            Annual Report to shareholders, a copy of which is furnished for the
            information of the Securities and Exchange Commission. Portions of
            the Annual Report not incorporated herein by reference are deemed
            not to be "filed" with the Commission.

14          Code of Ethics for Senior Financial Officers, incorporated herein by
            reference to Exhibit 14 to the Corporation's 2003 Annual Report on
            Form 10-K

21+         Subsidiaries of the Corporation.

23+         Accountant's Consents.

24+         Powers of Attorney.







<PAGE>


31(a)+      Rule 13a-14(a) Certifications of CEO (pursuant to Section 302 of
            Sarbanes-Oxley Act of 2002)

31(b)+      Rule 13a-14(a) Certifications of CFO (pursuant to Section 302 of
            Sarbanes-Oxley Act of 2002)

32(a)+      18 USC 1350 Certifications of CEO (pursuant to Section 906 of
            Sarbanes-Oxley Act of 2002)

32(b)+      18 USC 1350 Certifications of CFO (pursuant to Section 906 of
            Sarbanes-Oxley Act of 2002)



                       STATEMENT OF DIFFERENCES

The greater-than-or-equal-to sign shall be expressed as.......................>=




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3
<SEQUENCE>2
<FILENAME>ex3-2.txt
<DESCRIPTION>EXHIBIT 3.2
<TEXT>


<PAGE>

                                                                  Exhibit 3.2


                                    BYLAWS OF
                       FIRST HORIZON NATIONAL CORPORATION
                   (As Amended and Restated January 18, 2005)

                                   ARTICLE ONE
                                     OFFICES

         1.1 Principal Office. The principal office of First Horizon National
Corporation (the "Corporation") shall be 165 Madison Avenue, Memphis, Tennessee.

         1.2 Other Offices. The Corporation may have offices at such other
places, either within or without the State of Tennessee, as the Board of
Directors may from time to time designate or as the business of the Corporation
may from time to time require.

         1.3 Registered Office. The registered office of the Corporation
required to be maintained in the State of Tennessee shall be the same as its
principal office and may be changed from time to time as provided by law.

                                   ARTICLE TWO
                                  SHAREHOLDERS

         2.1 Place of Meetings. Meetings of the shareholders of the Corporation
may be held either in the State of Tennessee or elsewhere; but in the absence of
notice to the contrary, shareholders' meetings shall be held at the principal
office of the Corporation in Memphis, Tennessee.

         2.2 Quorum and Adjournments. The holders of a majority of the shares
issued and outstanding and entitled to vote thereat, present in person or
represented by proxy, shall be requisite, and shall constitute a quorum at all
meetings of the shareholders, for the transaction of business, except as
otherwise provided by law, the Restated Charter of the Corporation, as amended
from time to time (the "Charter"), or these Bylaws. In the event a quorum is not
obtained at the meeting, the holders of a majority of the shares entitled to
vote thereat, present in person or by proxy, shall have power to adjourn the
meeting from time to time and, whether or not a quorum is obtained at the
meeting, the Chairman of the meeting shall have the power to adjourn the meeting
from time to time, in either case without notice, except as otherwise provided
by law, other than announcement at the meeting. At such adjourned meeting at
which the requisite amount of voting shares shall be represented, any business
may be transacted which might have been transacted at the meeting as originally
notified.

         2.3 Notice of Meetings. Unless otherwise required by applicable law,
written notice of the annual and each special meeting stating the date, time and
place of the meeting shall be mailed, postage prepaid, or otherwise delivered to
each shareholder entitled to vote thereat at such address as appears on the
records of shareholders of the Corporation, at least ten (10) days, but not more
than two (2) months, prior to the meeting date. In addition, notice of any
special meeting shall state the purpose or purposes for which the meeting is
called and the person or persons calling the meeting. In the event of an
adjournment of a meeting to a date more than four months after the date fixed
for the original meeting or the Board of Directors fixes a new record date for
the adjourned meeting, a new notice of the adjourned meeting must be given to
shareholders as of the new record date. Any previously scheduled meeting may be
postponed, and any special meeting may be canceled, by resolution of the Board
of Directors upon public notice given prior to the date scheduled for such
meeting.

         2.4 Annual Meetings. The annual meeting of shareholders for the
election of directors and for the transaction of such other business as may
properly come before the meeting shall be held each year on the third Tuesday in
April, or if that day is a legal holiday, on the next succeeding business day
not a legal holiday, at 11:00 a.m. Memphis time or on such other date and/or at
such other time as the Board of Directors may fix by resolution by vote of a
majority of the entire Board of Directors. At the meeting, the shareholders
shall elect by ballot, by plurality vote, directors to succeed directors in the
class of directors whose term expires at the meeting and directors elected by
the Board of Directors to fill vacancies in other classes of directors and may
transact such other business as may properly come before the meeting.




<PAGE>



         2.5 Special Meetings. Special meetings of the shareholders for any
purpose or purposes, unless otherwise prescribed by statute, may be called by
Chairman of the Board and shall be called by the Chairman of the Board or the
Secretary at the request in writing of a majority of the Board of Directors.
Only such business within the purpose or purposes described in the notice of the
meeting may be conducted at the meeting.

         2.6 Waiver of Notice. Any shareholder may waive in writing notice of
any meeting either before, at or after the meeting. Attendance by a shareholder
in person or by proxy at a meeting shall constitute a waiver of objection to
lack of notice or defective notice and a waiver of objection to consideration of
a matter that was not described in the meeting notice unless the shareholder
objects in the manner required by law.

         2.7 Voting. Unless otherwise required by the Charter, at each meeting
of shareholders, each shareholder shall have one vote for each share of stock
having voting power registered in the shareholder's name on the records of the
Corporation on the record date for that meeting, and every shareholder having
the right to vote shall be entitled to vote in person or by proxy appointed by
instrument in writing or any other method permitted by law.

         2.8 Procedures for Bringing Business before Shareholder Meeting. At an
annual or special meeting of shareholders, only such business shall be
conducted, and only such proposals shall be acted upon, as shall have been
properly brought before an annual or special meeting of shareholders. To be
properly brought before an annual or special meeting of shareholders, business
must be (i) in the case of a special meeting called by the Chairman of the Board
or at the request of the Board of Directors, specified in the notice of the
special meeting (or any supplement thereto), or (ii) in the case of an annual
meeting properly brought before the meeting by or at the direction of the Board
of Directors or (iii) otherwise properly brought before the annual or special
meeting by a shareholder. For business to be properly brought before such a
meeting of shareholders by a shareholder, the shareholder must have given timely
notice thereof in writing to the Secretary of the Corporation. To be timely, a
shareholder's notice must be delivered to or mailed and received at the
principal executive offices of the Corporation not less than 90 days nor more
than 120 days prior to the date of the meeting; provided, however, that if fewer
than 100 days' notice or prior public disclosure of the date of the meeting is
given or made to shareholders, notice by the shareholders to be timely must be
so delivered or received not later than the close of business on the 10th day
following the earlier of (i) the day on which such notice of the date of such
meeting was mailed or (ii) the day on which such public disclosure was made. A
shareholder's notice to the Secretary shall set forth as to each matter the
shareholder proposes to bring before a meeting of shareholders (i) a brief
description of the business desired to be brought before the meeting and the
reasons for conducting such business at the meeting, (ii) the name and address,
as they appear on the Corporation's books, of the shareholder proposing such
business and any other shareholders known by such shareholder to be supporting
such proposal, (iii) the class and number of shares of the Corporation which are
beneficially owned by such shareholder on the date of such shareholder's notice
and by any other shareholders known by such shareholder to be supporting such
proposal on the date of such shareholder's notice, and (iv) any material
interest of the shareholder in such proposal. Notwithstanding anything in these
Bylaws to the contrary, no business shall be conducted at a meeting of
shareholders except in accordance with the procedures set forth in this Section
2.8. The Chairman of the meeting shall, if the facts warrant, determine and
declare to the meeting that the business was not properly brought before the
meeting in accordance with the procedures prescribed by these Bylaws, and if the
Chairman should so determine, the Chairman shall so declare to the meeting and
any such business not properly brought before the meeting shall not be
transacted.

         2.9 SEC Proxy Rules. In addition to complying with the provisions of
Section 2.8, a shareholder shall also comply with all applicable requirements of
the Securities Exchange Act of 1934 and the rules and regulations thereunder
with respect to the matters set forth in Section 2.8. Nothing in Section 2.8
shall be deemed to affect any rights of shareholders to request inclusion of
proposals in the Corporation's proxy statement pursuant to rules of the
Securities and Exchange Commission. For such proposals to be acted upon at a
meeting, however, compliance with the notice provisions of Section 2.8 is also
required.




<PAGE>



                                  ARTICLE THREE
                                    DIRECTORS

         3.1 Powers of Directors. The business and affairs of the Corporation
shall be managed under the direction of and all corporate powers shall be
exercised by or under the authority of the Board of Directors.

         3.2 Number and Qualifications. The Board of Directors shall consist of
eleven [twelve prior to 11:00 a.m. on April 19, 2005] members. The Board of
Directors has the power to change from time to time the number of directors
specified in the preceding sentence. Any such change in the number of directors
constituting the Corporation's Board Directors must be made exclusively by means
of an amendment to these Bylaws adopted by a majority of the entire Board of
Directors then in office. Directors need not be shareholders of the Corporation
nor residents of the State of Tennessee.

         3.3 Term of Office. Except as otherwise provided by law or by the
Charter, the term of each director hereafter elected shall be from the time of
his or her election and qualification until the third annual meeting next
following such election and until a successor shall have been duly elected and
qualified; subject, however, to the right of the removal of any director as
provided by law, by the Charter or by these Bylaws.

         3.4 Compensation. The directors shall be paid for their services on the
Board of Directors and on any Committee thereof such compensation (which may
include cash, shares of stock of the Corporation and options thereon) and
benefits together with reasonable expenses, if any, at such times as may, from
time to time, be determined by resolution adopted by a majority of the entire
Board of Directors; provided that nothing herein contained shall be construed to
preclude any director from serving the Corporation in any other capacity and
being compensated therefor.

         3.5 Committees. The directors, by resolution adopted by a majority of
the entire Board of Directors, may designate an executive committee and other
committees, consisting of two or more directors, and may delegate to such
committee or committees all such authority of the Board of Directors that it
deems desirable, including, without limitation, authority to appoint corporate
officers, fix their salaries, and, to the extent such is not provided by law,
the Charter or these Bylaws, to establish their authority and responsibility,
except that no such committee or committees shall have and exercise the
authority of the Board of Directors to:

         (a)  authorize distributions (which include dividend declarations),
              except according to a formula or method prescribed by the Board of
              Directors,

         (b)  fill vacancies on the Board of Directors or on any of its
              committees,

         (c)  adopt, amend or repeal bylaws,

         (d)  authorize or approve the reacquisition of shares, except according
              to a formula or method prescribed by the Board of Directors, or

         (e)  authorize or approve the issuance or sale or contract for sale of
              shares, or determine the designation and relative rights,
              preferences and limitations of a class or series of shares, except
              that the Board of Directors may authorize a committee to do so
              within limits specifically prescribed by the Board of Directors.

         3.6 Procedures for Director Nominations. Except as provided in Section
3.7 with respect to vacancies on the Board of Directors, only persons nominated
in accordance with the procedures set forth in this Section 3.6 shall be
eligible for election as directors. Nominations of persons for election to the
Board of Directors may be made at a meeting of shareholders (i) by or at the
direction of the Board of Directors, or (ii) by any shareholder of the
Corporation entitled to vote for the election of directors at such meeting who
complies with the notice procedures set forth in this Section 3.6. Such
nominations, other than those made by or at the direction of the Board of
Directors, shall be made pursuant to timely notice in writing to the Secretary
of the Corporation. To be timely, a shareholder's notice must be delivered to or
mailed and received at the principal executive offices of the




<PAGE>





Corporation not less than 90 days nor more than 120 days prior to the date of a
meeting; provided, however, that if fewer than 100 days' notice or prior public
disclosure of the date of the meeting is given or made to shareholders, notice
by the shareholder to be timely must be so delivered or received not later than
the close of business on the 10th day following the earlier of (i) the day on
which such notice of the date of such meeting was mailed or (ii) the day on
which such public disclosure was made. A shareholder's notice to the Secretary
shall set forth (i) as to each person whom the shareholder proposes to nominate
for election or reelection as a director (a) the name, age, business address and
residence address of such person, (b) the principal occupation or employment of
such person, (c) the class and number of shares of the Corporation which are
beneficially owned by such person on the date of such shareholder's notice and
(d) any other information relating to such person that is required to be
disclosed in solicitations of proxies for election of directors or, is otherwise
required, in each case pursuant to Regulation 14A under the Securities Exchange
Act of 1934, as amended (including, without limitation, such person's written
consent to being named in the proxy statement as a nominee and to serving as a
director if elected); and (ii) as to the shareholder giving the notice (a) the
name and address, as they appear on the Corporation's books, of such shareholder
and any other shareholders known by such shareholder to be supporting such
nominees and (b) the class and number of shares of the Corporation which are
beneficially owned by such shareholder on the date of such shareholder's notice
and by any other shareholders known by such shareholder to be supporting such
nominees on the date of such shareholder's notice. No person shall be eligible
for election as a director of the Corporation unless nominated in accordance
with the procedures set forth in this Section 3.6. The Chairman of the meeting
shall, if the facts warrant, determine and declare to the meeting that a
nomination was not made in accordance with the procedures prescribed by these
Bylaws, and if the Chairman should so determine, the Chairman shall so declare
to the meeting and the defective nomination shall be disregarded.

         3.7 Vacancies; Removal from Office. Except as otherwise provided by law
or by the Charter, newly created directorships resulting from any increase in
the authorized number of directors or any vacancies on the Board of Directors
resulting from death, resignation, retirement, disqualification or any other
cause (except removal from office) shall be filled only by the Board of
Directors, provided that a quorum is then in office and present, or only by a
majority of the directors then in office, if less than a quorum is then in
office or by the sole remaining director. Any vacancies on the Board of
Directors resulting from removal from office may be filled by the affirmative
vote of the holders of at least a majority of the voting power of all
outstanding voting stock or, if the shareholders do not so fill such a vacancy,
by a majority of the directors then in office. Directors elected to fill a newly
created directorship or other vacancy shall hold office for a term expiring at
the next shareholders' meeting at which directors are elected and until such
director's successor has been duly elected and qualified. The directors of any
class of directors of the Corporation may be removed by the shareholders only
for cause by the affirmative vote of the holders of at least a majority of the
voting power of all outstanding voting stock.

         3.8 Place of Meetings. The directors may hold meetings of the Board of
Directors or of a committee thereof at the principal office of the Corporation
in Memphis, Tennessee, or at such other place or places, either in the State of
Tennessee or elsewhere, as the Board of Directors or the members of the
committee, as applicable, may from time to time determine by resolution or by
written consent or as may be specified in the notice of the meeting.

         3.9 Quorum. A majority of the directors shall constitute a quorum for
the transaction of business, but a smaller number may adjourn from time to time,
without further notice, if the time and place to which the meeting is adjourned
are fixed at the meeting at which the adjournment is taken and if the period of
adjournment does not exceed thirty (30) days in any one (1) adjournment. The
vote of a majority of the directors present at a meeting at which a quorum is
present shall be the act of the Board of Directors, unless the vote of a greater
number is required by law, the Charter, or these Bylaws.

         3.10 Regular Meetings. Following each annual meeting of shareholders,
the newly elected directors, together with the incumbent directors whose terms
do not expire at such meeting, shall meet for the purpose of organization, the
appointment of officers and the transaction of other business, and, if a
majority of the directors be present at such place, day and hour, no prior
notice of such meeting shall be required to be given to the directors. The
place, day and hour of such meeting may also be fixed by resolution or by
written consent of the directors. In addition, the Board of Directors may
approve an annual schedule for additional regular meetings of the Board of
Directors and of committees thereof.




<PAGE>





         3.11 Special Meetings. Special meetings of the directors may be called
by the Chairman of the Board, the Chief Executive Officer, or the President (or
as to any committee of the Board of Directors, by the person or persons
specified in the resolution of the Board of Directors establishing the
committee) on two days' notice by mail or on one day's notice by telegram or
cablegram, or on two hours' notice given personally or by telephone or facsimile
transmission to each director (or member of the committee, as appropriate), and
shall be called by the Chairman of the Board or Secretary in like manner on the
written request of a majority of directors then in office. The notice shall
state the day and hour of the meeting and the place where the meeting is to be
held. Special meetings of the directors may be held at any time on written
waiver of notice or by consent of all the directors, either of which may be
given either before, at or after the meeting.

         3.12 Action without a Meeting. The directors may (whether acting in
lieu of a meeting of the Board of Directors or of a committee thereof) take
action which they are required or permitted to take, without a meeting, on
written consent setting forth the action so taken, signed by all of the
directors entitled to vote thereon. If all the directors entitled to vote
consent to taking such action without a meeting, the affirmative vote of the
number of directors necessary to authorize or take such action at a meeting is
the act of the Board of Directors or committee, as appropriate.

         3.13 Telephone Meetings. Directors may participate in a meeting of the
Board of Directors or of a committee thereof by, or conduct a meeting through
the use of, any means of communication by which all directors participating may
simultaneously hear each other during the meeting. A director so participating
is deemed to be present in person at such meeting.

                                  ARTICLE FOUR
                                    OFFICERS

         4.1 Designated Officers. The officers of the Corporation shall consist
of a Chairman of the Board, a Chief Executive Officer, a President, such number
of Vice Chairmen as the Board may from time to time determine and appoint, an
Auditor, a Chief Credit Officer, a Chief Financial Officer, a Controller, a
General Counsel, an Executive Vice President-Risk Management, an Executive Vice
President-Corporate and Employee Services, a President-First Tennessee Financial
Services, a Chief Operating Officer-First Tennessee Financial Services, an
Executive Vice President-Interest Rate Risk Management, an Executive Vice
President-Banking Services Group, a President-FTN Financial, a President-First
Horizon Financial Services, a Secretary, and a Treasurer, and such number of
Senior Executive Vice Presidents, Executive Vice Presidents, Senior Vice
Presidents and Vice Presidents and such other Officers and assistant Officers as
may be from time to time determined and appointed in accordance with the
provisions of this Article Four. The title of any officer may include any
additional descriptive designation determined to be appropriate. Any person may
hold two or more offices, except that the President shall not also be the
Secretary or an Assistant Secretary. The officers, other than the Chairman of
the Board, need not be directors, and officers need not be shareholders.

         4.2 Appointment of Officers. Except as otherwise provided in this
Section 4.2, the officers of the Corporation shall be appointed by the Board of
Directors at the annual organizational meeting of the Board of Directors
following the annual meeting of shareholders. The Board of Directors may
delegate to a committee of the Board of Directors the power to create corporate
offices, define the authority and responsibility of such offices, except to the
extent such authority or responsibility would not be consistent with the law or
the Charter, and to appoint persons to any office of the Corporation except the
offices of the Chairman of the Board, Chief Executive Officer, and President,
any office the incumbent in which is designated by the Board as an Executive
Officer (as defined in Section 4.5 hereof), and, upon the recommendation of the
Audit Committee, the Auditor. In addition, the Board of Directors may delegate
to the officers appointed to the Corporation's personnel committee, acting as a
committee, the authority to appoint persons to any offices of the Corporation of
the level of Vice President and below annually at the personnel committee
meeting following the annual meeting of shareholders and to appoint persons to
any office of the Corporation of the level of Executive Vice President and below
during the period of time between the annual appointment of officers by the
Board of Directors or pursuant to this section 4.2 of the Bylaws.
Notwithstanding the delegation of authority pursuant to this section 4.2 of the
Bylaws, the Board of Directors retains the authority to appoint all officers and
such other officers and agents as it shall deem necessary,




<PAGE>



who shall exercise such powers and perform such duties as shall be determined
from time to time by the Board of Directors.

         4.3 Term. The officers of the Corporation shall be appointed for a term
of one (1) year and until their successors are appointed and qualified, subject
to the right of removal specified in Section 4.4 of these Bylaws. The
designation of a specified term does not grant to any officer any contract
rights.

         4.4 Vacancies, Resignations and Removal. If the office of any officer
or officers becomes vacant for any reason, the vacancy may be filled by the
Board of Directors or, if such officer was appointed by a committee, by the
committee appointing such officer. Any officer may resign at any time by
delivering a written notice to the Chairman of the Board, Chief Executive
Officer, President, Secretary, or Executive Vice President-Employee Services of
the Corporation, or the designee of any of them, which shall be effective upon
delivery unless it specifies a later date acceptable to the Corporation. Any
officer designated by the Board as an Executive Officer shall be subject to
removal at any time with or without cause only by the affirmative vote of a
majority of the Board of Directors. The Auditor shall be subject to removal at
any time with or without cause only by the affirmative vote of a majority of the
Board of Directors, upon the recommendation of the Audit Committee. Any other
officer shall be subject to removal at any time with or without cause by the
affirmative vote of a majority of the Board of Directors, and in the event the
officer was, or could have been, appointed by a committee, then by the
affirmative vote of a majority of either such committee or the Board of
Directors.

         4.5 Compensation. The Board of Directors, or a committee thereof, shall
fix the compensation of Executive Officers (as defined herein) of the
Corporation. "Executive Officers" shall be those officers of the Corporation
identified as such from time to time in a resolution or resolutions of the Board
of Directors. The compensation of officers who are not Executive Officers shall
be fixed by the Board of Directors, by a committee thereof, or by management
under such policies and procedures as shall be established by the Board of
Directors or a committee thereof.

         4.6 Delegation of Officer Duties. In case of the absence of any officer
of the Corporation, or for any reason that the Board of Directors (or, in
addition, in the case of any officer appointed by a committee, such committee or
any other committee which could appoint such officer pursuant to Section 4.2 of
these Bylaws) may deem sufficient, the Board of Directors (or committee, as
applicable) may delegate, for the time being, the powers or duties, or any of
them, of such officer to any other officer, or to any director.

         4.7 Chairman of the Board. The Chairman of the Board shall preside at
all meetings of the shareholders and of the Board of Directors and shall have
such powers and perform such duties as may be provided for herein and as are
normally incident to the office and as may be assigned by the Board of
Directors. If and at such times as the Board of Directors so determines, the
Chairman of the Board may also serve as the Chief Executive Officer of the
Corporation.

         4.8 Chief Executive Officer. The Chief Executive Officer, in the
absence of the Chairman of the Board, shall preside at all meetings of the
shareholders and of the Board of Directors. The Chief Executive Officer shall be
responsible for carrying out the orders of and the resolutions and policies
adopted by the Board of Directors and shall have general management of the
business of the Corporation and shall exercise general supervision over all of
its affairs. In addition, the Chief Executive Officer shall have such powers and
perform such duties as may be provided for herein and as are normally incident
to the office and as may be prescribed by the Board of Directors. If and at such
time as the Board of Directors so determines, the Chief Executive Officer may
also serve as the President of the Corporation.

         4.9 President. The President, in the absence of the Chairman of the
Board and the Chief Executive Officer, shall preside at all meetings of the
shareholders and of the Board of Directors. The President shall be the Chief
Executive Officer of the Corporation unless the Board of Directors has appointed
another person to such office, in which case the President shall be the Chief
Operating Officer of the Corporation and shall have such powers and perform such
duties as may be provided for herein and as are normally incident to the office
and as may be prescribed by the Board of Directors, the Chairman of the Board,
or the Chief Executive Officer.




<PAGE>



         4.10 Vice Chairmen. Vice Chairmen shall perform such duties and
exercise such powers as may be prescribed by the Board of Directors, the
Chairman of the Board, or the Chief Executive Officer.

         4.11 Chief Financial Officer. The Chief Financial Officer shall be the
principal financial officer of the Corporation. The Chief Financial Officer is
authorized to sign any document filed with the Securities and Exchange
Commission or any state securities commission on behalf of the Corporation and
shall perform such duties and exercise such powers as are normally incident to
the office and as may be prescribed by the Board of Directors, the Chairman of
the Board, or the Chief Executive Officer.

         4.12 Chief Credit Officer. The Chief Credit Officer shall perform such
duties and exercise such powers as are normally incident to the office and as
may be prescribed by the Board of Directors, the Chairman of the Board, or the
Chief Executive Officer.

         4.13 General Counsel. The General Counsel shall perform such duties and
exercise such powers as are normally incident to the office and as may be
prescribed by the Board of Directors, the Chairman of the Board, or the Chief
Executive Officer.

         4.14 Executive Vice President-Corporate and Employee Services. The
Executive Vice President-Employee Services shall perform such duties and
exercise such powers as are normally incident to the office and as may be
prescribed by the Board of Directors, the Chairman of the Board, or the Chief
Executive Officer.

         4.15 President-First Tennessee Financial Services. The President-First
Tennessee Financial Services shall perform such duties and exercise such powers
as are normally incident to the office and as may be prescribed by the Board of
Directors, the Chairman of the Board, or the Chief Executive Officer.

         4.16 Chief Operating Officer-First Tennessee Financial Services. The
Chief Operating Officer-First Tennessee Financial Services shall perform such
duties and exercise such powers as are normally incident to the office and as
may be prescribed by the Board of Directors, the Chairman of the Board, or the
Chief Executive Officer.

         4.17 Executive Vice President-Risk Management. The Manager of Risk
Management Executive Vice President-Risk Management shall perform such duties
and exercise such powers as are normally incident to the office and as may be
prescribed by the Board of Directors, the Chairman of the Board, or the Chief
Executive Officer.

         4.18 Executive Vice President-Bank Services Group. The Executive Vice
President-Bank Services Group shall perform such duties and exercise such powers
as are normally incident to the office and as may be prescribed by the Board of
Directors, the Chairman of the Board, or the Chief Executive Officer.

         4.19 Executive Vice President-Interest Rate Risk Management. The
Executive Vice President-Interest Rate Risk Management shall perform such duties
and exercise such powers as are normally incident to the office and as may be
prescribed by the Board of Directors, the Chairman of the Board, or the Chief
Executive Officer.

         4.20 President-FTN Financial. The President-FTN Financial shall perform
such duties and exercise such powers as are normally incident to the office and
as may be prescribed by the Board of Directors, Chairman of the Board, or Chief
Executive Officer.

         4.21 President-First Horizon Financial Services. The President-First
Horizon Financial Services shall perform such duties and exercise such powers as
are normally incident to the office and as may be prescribed by the Board of
Directors, Chairman of the Board, or Chief Executive Officer.

         4.22 Senior Executive Vice Presidents, Executive Vice Presidents,
Senior Vice Presidents and Vice Presidents. Senior Executive Vice Presidents,
Executive Vice Presidents, Senior Vice Presidents and Vice Presidents shall
perform such duties and exercise such powers as may be prescribed by the Board
of Directors, a committee thereof, the personnel committee, the Chairman of the
Board, or the Chief Executive Officer.




<PAGE>


         4.23 Secretary. The Secretary shall attend all sessions of the Board of
Directors and of the shareholders and record all votes and the minutes of all
proceedings in books to be kept for that purpose. The Secretary shall give or
cause to be given notice of all meetings of the shareholders and of the Board of
Directors, shall authenticate records of the Corporation, and shall perform such
other duties as are incident to the office or as may be prescribed by the Board
of Directors, the Chairman of the Board or the Chief Executive Officer. In the
absence or disability of the Secretary, the Assistant Secretary or such other
officer or officers as may be authorized by the Board of Directors or Executive
Committee thereof shall perform all the duties and exercise all of the powers of
the Secretary and shall perform such other duties as the Board of Directors,
Chairman of the Board or the Chief Executive Officer shall prescribe.

          4.24 Treasurer. The Treasurer shall have the custody of the funds and
securities of the Corporation and shall keep full and accurate accounts of
receipts and disbursements in books belonging to the Corporation and shall
deposit all monies and other valuable effects in the name and to the credit of
the Corporation in such depositories as may be designated by the Board of
Directors. The Treasurer shall disburse the funds of the Corporation as may be
ordered by the Board of Directors, the Chairman of the Board, the Chief
Executive Officer, the Chief Financial Officer, or the President, taking proper
vouchers for such disbursements, and shall render to the Board of Directors, the
Chairman of the Board, the Chief Executive Officer, the Chief Financial Officer,
or the President, whenever they may require it, an account of all of his or her
transactions as Treasurer and of the financial condition of the Corporation, and
at a regular meeting of the Board of Directors preceding the annual
shareholders' meeting, a like report for the preceding year. The Treasurer shall
keep or cause to be kept an account of stock registered and transferred in such
manner and subject to such regulations as the Board of Directors may prescribe.
The Treasurer shall give the Corporation a bond, if required by the Board of
Directors, in such a sum and in form and with security satisfactory to the Board
of Directors for the faithful performance of the duties of the office and the
restoration to the Corporation, in case of his or her death, resignation or
removal from office, of all books, papers, vouchers, money and other property of
whatever kind in his or her possession, belonging to the Corporation. The
Treasurer shall perform such other duties as the Board of Directors may from
time to time prescribe or require. In the absence or disability of the
Treasurer, the Assistant Treasurer shall perform all the duties and exercise all
of the powers of the Treasurer and shall perform such other duties as the Board
of Directors, the Chairman of the Board, or the Chief Executive Officer shall
prescribe.

         4.25 Auditor. The Auditor shall perform such duties and exercise such
powers as are normally incident to the office and as may be prescribed by the
Board of Directors or the Chairman of the Audit Committee.

         4.26 Controller. The Controller shall be the principal accounting
officer of the Corporation. The Controller is authorized to sign any document
filed with the Securities and Exchange Commission or any state securities
commission on behalf of the Corporation and shall assist the management of the
Corporation in setting the financial goals and policies of the Corporation,
shall provide financial and statistical information to the shareholders and to
the management of the Corporation and shall perform such other duties and
exercise such other powers as may be prescribed by the Board of Directors, the
Chairman of the Board, the Chief Executive Officer or the President. In the
absence or disability of the Controller, the Assistant Controller shall perform
all the duties and exercise all powers of the Controller and shall perform such
duties as the Board of Directors or the Chairman of the Board or the Chief
Executive Officer shall prescribe.

         4.27 Other Officers. Officers holding such other offices as may be
created pursuant to Sections 4.1 and 4.2 of these Bylaws shall have such
authority and perform such duties and exercise such powers as may be prescribed
by the Board of Directors, a committee thereof, the personnel committee, the
Chairman of the Board or the Chief Executive Officer.

         4.28 Officer Committees. The directors, by resolution adopted by a
majority of the entire Board of Directors, may designate one or more committees,
consisting of two or more officers, and may delegate to such committee or
committees all such authority that the Board of Directors deems desirable that
is permitted by law. Members of such committees may take action without a
meeting and may participate in meetings to the same extent and in the same
manner that directors may take action and may participate pursuant to Sections
3.12 and 3.13 of these Bylaws.




<PAGE>


                                  ARTICLE FIVE
                                 SHARES OF STOCK

         5.1 Certificates. The certificates representing shares of stock of the
Corporation shall be numbered, shall be entered in the books or records of the
Corporation as they are issued, and shall be signed by the Chairman of the Board
or the Chief Executive Officer and any one of the following: the President, the
Treasurer, or the Secretary. Either or both of the signatures upon a certificate
may be facsimiles if the certificate is countersigned by a transfer agent, or
registered by a registrar other than an officer or employee of the Corporation.
Each certificate shall include the following upon the face thereof:

         (a)  A statement that the Corporation is organized under the laws of
              the State of Tennessee;

         (b)  The name of the Corporation;

         (c)  The name of the person to whom issued;

         (d)  The number and class of shares, and the designation of the series,
              if any, which such certificate represents;

         (e)  The par value of each share represented by such certificate; or a
              statement that the shares are without par value; and

         (f)  Such other provisions as the Board of Directors may from time to
              time require.

         5.2 Shares Not Represented by Certificates. Notwithstanding the
provisions of Section 5.1 of these Bylaws, the Board of Directors may authorize
the issuance of some or all of the shares of any class without certificates. The
Corporation shall send to each shareholder to whom such shares have been issued
or transferred at the appropriate time any written statement providing
information about such shares, which is required by law.

         5.3 Stock Transfers and Record Dates. Transfers of shares of stock
shall be made upon the books of the Corporation by the record owner or by an
attorney, lawfully constituted in writing, and upon surrender of any certificate
therefor. The Board of Directors may appoint suitable agents in Memphis,
Tennessee, and elsewhere to facilitate transfers by shareholders under such
regulations as the Board of Directors may from time to time prescribe. The
transfer books may be closed by the Board of Directors for such period, not to
exceed 40 days, as may be deemed advisable for dividend or other purposes, or in
lieu of closing the books, the Board of Directors may fix in advance a date as
the record date for determining shareholders entitled notice of and to vote at a
meeting of shareholders, or entitled to payment of any dividend or other
distribution. The record date for voting or taking other action as shareholders
shall not be less than 10 days nor more than 70 days prior to the meeting date
or action requiring such determination of shareholders. The record date for
dividends and other distributions shall not be less than 10 days prior to the
payment date of the dividend or other distribution. All certificates surrendered
to the Corporation for transfer shall be canceled, and no new certificate shall
be issued until the former certificate for like number of shares shall have been
surrendered and canceled, except that in case of a lost or destroyed certificate
a new one may be issued on the terms prescribed by Section 5.5 of these Bylaws.

         5.4 Record Owners. The Corporation shall be entitled to treat the
holder of record of any share or shares of stock as the holder in fact thereof;
and, accordingly, shall not be bound to recognize any equitable or other claim
to or interest in such share on the part of any other person, whether or not it
shall have express or other notice thereof, except as required by applicable
law.

         5.5 Lost, Destroyed, Stolen or Mutilated Certificates. The agent for
transfer of the Corporation's stock may issue new share certificates in place of
certificates represented to have been lost, destroyed, stolen or mutilated upon
receiving an indemnity satisfactory to the agent and the Secretary or Treasurer
of the Corporation, without further action of the Board of Directors.




<PAGE>




                                   ARTICLE SIX
                                 INDEMNIFICATION

         6.1 Indemnification of Officers When Wholly Successful. If any current
or former officer of the Corporation [including for purposes of this Article an
individual who, while an officer, is or was serving another corporation or other
enterprise (including an employee benefit plan and a political action committee,
which serves the interests of the employees of the Corporation or any of its
subsidiaries) in any capacity at the request of the Corporation and unless the
context requires otherwise the estate or personal representative of such
officer] is wholly successful, on the merits or otherwise, in the defense of any
threatened, pending or completed action, suit, or proceeding, whether civil,
criminal, administrative, or investigative and whether formal or informal
("Proceeding"), to which the officer was a party because he or she is or was an
officer of the Corporation, the officer shall be indemnified by the Corporation
against all reasonable expenses, including attorney fees, incurred in connection
with such Proceeding, or any appeal therein. As used in this Article,
"Proceeding" shall include, but is not limited to, any threatened, pending or
contemplated action, suit or proceeding, whether civil, criminal,
administrative, or investigative, and whether formal or informal, arising out of
or alleging any acts, errors, or omissions by the officer in the rendering or
failure to render professional services, including legal and accounting
services, for or at the request of the Corporation or any of its subsidiaries;
provided such professional services are within the reasonably anticipated scope
of the officer's duties. Additionally, as used in this Article, "Proceeding"
shall include, but is not limited to, any threatened, pending or contemplated
action, suit or proceeding arising out of or alleging negligence on the part of
the Officer.

         6.2 Indemnification of Officers When Not Wholly Successful. If any
current or former officer of the Corporation has not been wholly successful on
the merits or otherwise, in the defense of a Proceeding, to which the officer
was or was threatened to be made a party because he or she was or is an officer,
the officer shall be indemnified by the Corporation against any judgment,
settlement, penalty, fine (including any excise tax assessed with respect to an
employee benefit plan), or other liability and any reasonable expenses,
including attorney fees, incurred as a result of such Proceeding, or any appeal
therein, if authorized in the specific case after a determination has been made
that indemnification is permissible because the following standard of conduct
has been met:

         (a)  The officer conducted himself or herself in good faith, and

         (b)  The officer reasonably believed: (i) in the case of conduct in the
              officer's official capacity as an officer of the Corporation that
              the officer's conduct was in the Corporation's best interest; and
              (ii) in all other cases that the officer's conduct was at least
              not opposed to its best interests; and

         (c)  In the case of any criminal proceeding, the officer had no
              reasonable cause to believe his or her conduct was unlawful;

provided, however, the Corporation may not indemnify an officer in connection
with a Proceeding by or in the right of the Corporation in which the officer was
adjudged liable to the Corporation or in connection with any other proceeding
charging improper benefit to the officer, whether or not involving action in his
or her official capacity, in which the officer was adjudged liable on the basis
that personal benefit was improperly received by the officer.

         6.3 Procedures for Indemnification Determinations. The determination
required by Section 6.2 herein shall be made as follows:

         (a)  By the Board of Directors by a majority vote of a quorum
              consisting of directors not at the time parties to the Proceeding;

         (b)  If a quorum cannot be obtained, by majority vote of a committee
              duly designated by the Board of Directors (in which designation
              directors who are parties may participate) consisting solely of
              two or more directors not at the time parties to the Proceeding;

         (c)  By independent special legal counsel: (i) selected by the Board of
              Directors or its committee in the manner prescribed in subsection
              (a) or (b); or (ii) if a quorum of the Board of Directors cannot
              be




<PAGE>




              obtained under subsection (a) and a committee cannot be
              designated under subsection (b), selected by majority vote of the
              full Board of Directors (in which selection directors who are
              parties may participate); or, if a determination pursuant to
              subsections (a), (b), or (c) of this Section 6.3 cannot be
              obtained, then

         (d)  By the shareholders, but shares owned by or voted under the
              control of directors who are at the time parties to the Proceeding
              may not be voted on the determination.

         6.4 Serving at the Request of the Corporation. An officer of the
Corporation shall be deemed to be serving another corporation or other
enterprise or employee benefit plan or political action committee at the request
of the Corporation only if such request is reflected in the records of the Board
of Directors or a committee appointed by the Board of Directors for the purpose
of making such requests. Approval by the Board of Directors, or a committee
thereof, may occur before or after commencement of such service by the officer.

         6.5 Advancement of Expenses. The Corporation shall pay for or reimburse
reasonable expenses, including attorney fees, incurred by an officer who is a
party to a Proceeding in advance of the final disposition of the Proceeding if:

         (a)  The officer furnishes to the Corporation a written affirmation of
              the officer's good faith belief that the officer has met the
              standard of conduct described in Section 6.2 herein;

         (b)  The officer furnishes to the Corporation a written undertaking,
              executed personally or on behalf of the officer, to repay the
              advance if it is ultimately determined that the officer is not
              entitled to indemnification; and

         (c)  A determination is made that the facts then known to those making
              the determination would not preclude indemnification under this
              bylaw.

          6.6 Undertaking Required for Expenses. The undertaking required by
Section 6.5 herein must be an unlimited general obligation of the officer but
need not be secured and may be accepted without reference to financial ability
to make repayment.

         6.7 Procedures for Expense Determinations. Determinations and
authorizations of payments under Section 6.5 herein shall be made in the same
manner as is specified in Section 6.3 herein.

          6.8 Indemnification of Employees and Former Directors. Every employee
and every former director of the Corporation shall be indemnified by the
Corporation to the same extent as officers of the Corporation.

         6.9 Nonexclusivity of Right of Indemnification. The right of
indemnification set forth above shall not be deemed exclusive of any other
rights, including, but not limited to, rights created pursuant to Section 6.11
of these Bylaws, to which an officer, employee, or former director seeking
indemnification may be entitled. No combination of rights shall permit any
officer, employee or former director of the Corporation to receive a double or
greater recovery.

         6.10 Mandatory Indemnification of Directors and Designated Officers.
The Corporation shall indemnify each of its directors and such of the
non-director officers of the Corporation or any of its subsidiaries as the Board
of Directors may designate, and shall advance expenses, including attorney's
fees, to each director and such designated officers, to the maximum extent
permitted (or not prohibited) by law, and in accordance with the foregoing, the
Board of Directors is expressly authorized to enter into individual indemnity
agreements on behalf of the Corporation with each director and such designated
officers which provide for such indemnification and expense advancement and to
adopt resolutions which provide for such indemnification and expense
advancement.

         6.11 Insurance. Notwithstanding anything in this Article Six to the
contrary, the Corporation shall have the additional power to purchase and
maintain insurance on behalf of any person who is or was a director, officer,
employee, or agent of the Corporation, or who, while a director, officer,
employee or agent of the




<PAGE>



Corporation, is or was serving at the request of the Corporation as a director,
officer, partner, trustee, employee, or agent of another foreign or domestic
corporation, partnership, joint venture, trust, employee benefit plan, political
action committee, or other enterprise, against liability asserted against or
incurred by the person in that capacity or arising from the person's status as a
director, officer, employee, or agent, whether or not the Corporation would have
the power to indemnify the person against the same liability.

                                  ARTICLE SEVEN
                                   RETIREMENT

         7.1 Non-Employee Directors. Directors who are not also officers of the
Corporation or its affiliates shall be retired from the Board of Directors as
follows:

         (a)  Any director who shall attain the age of sixty-five (65) on or
              before the last day of the term for which he or she was elected
              shall not be nominated for re-election and shall be retired from
              the Board of Directors at the expiration of such term; provided,
              however, any director first elected to the Board of Directors
              prior to April 17, 1996, may serve a minimum of two three-year
              terms.

         (b)  For the purpose of maintaining boards of active business and
              professional persons, directors leaving the occupation or the
              position held at their last election (by retirement or otherwise)
              will be expected to tender their resignation for consideration at
              the next regularly scheduled meeting of the Board of Directors. A
              resignation will be accepted unless the Board in its judgment
              determines (i) the director has assumed another position deemed to
              be appropriate, (ii) the director is so engaged in a specific
              project for the Board as to make his or her resignation
              detrimental to the Corporation, or (iii) it is beneficial to the
              Board and in the best interests of the Corporation for the
              director to continue for such period of time as the Board deems
              appropriate.

Directors who are also officers of the Corporation or any of its affiliates will
be retired from the Board of Directors on the date of the annual meeting
coincident with or next following the date of the director's retirement from or
other discontinuation of active service with the Corporation and its affiliates.

         7.2 Officers and Employees. Except as provided in the following
sentence, the Corporation has no compulsory retirement age for its officers or
employees. Each officer or employee who has attained 65 years of age and who,
for the two-year period immediately before attaining such age, has been employed
in a "bona fide executive" or a "high policy-making" position as those terms are
used and defined in the Age Discrimination in Employment Act, Section 12(c), and
the regulations relating to that section prescribed by the Equal Employment
Opportunity Commission, all as amended from time to time (collectively, the
"ADEA"), shall automatically be terminated by way of compulsory retirement and
his or her salary discontinued on the first day of the month coincident with or
immediately following the 65th birthday, provided such employee is entitled to
an immediate nonforfeitable annual retirement benefit, as specified in the ADEA,
in the aggregate amount of at least $44,000. Notwithstanding the prior sentence,
the Board of Directors, in its discretion, may continue any such officer or
employee in service and designate the capacity in which he or she shall serve,
and shall fix the remuneration he or she shall receive. The Board of Directors
may also re-employ any former officer who had theretofore been retired.

                                  ARTICLE EIGHT
                             EXECUTION OF DOCUMENTS

         8.1 Definition of "Document." For purposes of this Article Eight of the
Bylaws, the term "document" shall mean a document of any type, including, but
not limited to, an agreement, contract, instrument, power of attorney,
endorsement, assignment, transfer, stock or bond power, deed, mortgage, deed of
trust, lease, indenture, conveyance, proxy, waiver, consent, certificate,
declaration, receipt, discharge, release, satisfaction, settlement, schedule,
account, affidavit, security, bill, acceptance, bond, undertaking, check, note
or other evidence of indebtedness, draft, guaranty, letter of credit, and order.

         8.2 Execution of Documents. Except as expressly provided in Section 5.1
of these Bylaws (with respect to signatures on certificates representing shares
of stock of the Corporation), the Chairman of the Board, the




<PAGE>



Chief Executive Officer, the President, any Vice Chairman, any Senior Executive
Vice President, any Executive Vice President, any Senior Vice President, any
Vice President, the Chief Financial Officer, the Chief Credit Officer, the
General Counsel, the Executive Vice President-Corporate and Employee Services,
the President-First Tennessee Financial Services, the Chief Operating
Officer-First Tennessee Financial Services, the Executive Vice President-Risk
Management, the Executive Vice President-Interest Rate Risk Management, the
Executive Vice President-Bank Services Group, the President-FTN Financial, the
President-First Horizon Financial Services, the Controller, the Treasurer, the
Secretary, and any other officer, or any of them acting individually, may (i)
execute and deliver in the name and on behalf of the Corporation or in the name
and on behalf of any division or department of the Corporation any document
pertaining to the business, affairs, or property of the Corporation or any
division or department of the Corporation, and (ii) delegate to any other
officer, employee or agent of the Corporation the power to execute and deliver
any such document.

         8.3 Method of Execution by Secretary. Unless otherwise required by law,
the signature of the Secretary on any document may be a facsimile.

                                  ARTICLE NINE
                                EMERGENCY BYLAWS

         9.1 Definition of "Emergency." The provisions of this Article Nine
shall be effective only during an "emergency." An "emergency" shall be deemed to
exist whenever any two of the officers identified in Section 9.2 of these Bylaws
in good faith determine that a quorum of the directors cannot readily be
assembled because of a catastrophic event.

         9.2 Notice of Meeting. A meeting of the Board of Directors may be
called by any one director or by any one of the following officers: Chairman of
the Board, Chief Executive Officer, President, any Vice Chairman, any Senior
Executive Vice President, any Executive Vice President, Chief Credit Officer,
Chief Financial Officer, Controller, General Counsel, Executive Vice
President-Risk Management, Executive Vice President-Corporate and Employee
Services, President-First Tennessee Financial Services, Chief Operating
Officer-First Tennessee Financial Services, Executive Vice President-Interest
Rate Risk Management, Executive Vice President-Bank Services Group,
President-FTN Financial, President-First Horizon Financial Services, or
Secretary. Notice of such meeting need be given only to those directors whom it
is practical to reach by any means the person calling the meeting deems
feasible, including, but not limited to, by publication and radio. Such notice
shall be given at least two hours prior to commencement of the meeting.

         9.3 Quorum and Substitute Directors.. If a quorum has not been
obtained, then one or more officers of the Corporation or the Bank present at
the emergency meeting of the Board of Directors, as are necessary to achieve a
quorum, shall be considered to be substitute directors for purposes of the
meeting, and shall serve in order of rank, and within the same rank in order of
seniority determined by hire date by the Corporation, the Bank or any of their
subsidiaries. In the event that less than a quorum of the directors (including
any officers who serve as substitute directors for the meeting) are present,
those directors present (including such officers serving as substitute
directors) shall constitute a quorum.

         9.4 Action at Meeting. The Board as constituted pursuant to Section 9.3
and after notice has been provided pursuant to Section 9.2 may take any of the
following actions: (i) prescribe emergency powers of the Corporation, (ii)
delegate to any officer or director any of the powers of the Board of Directors,
(iii) designate lines of succession of officers and agents in the event that any
of them are unable to discharge their duties, (iv) relocate the principal office
or designate alternative or multiple principal offices, and (v) take any other
action that is convenient, helpful, or necessary to carry on the business of the
Corporation.

         9.5 Effectiveness of Non-emergency Bylaws. All provisions of these
Bylaws not contained in this Article Nine, which are consistent with the
emergency bylaws contained in Article Nine, shall remain effective during the
emergency.

         9.6 Termination of Emergency. Any emergency causing this Article Nine
to become operative shall be deemed to be terminated whenever either of the
following conditions is met: (i) the directors and any substitute




<PAGE>




directors determine by a majority vote at a meeting that the emergency is over
or (ii) a majority of the directors elected pursuant to the provisions of these
Bylaws other than this Article Nine hold a meeting and determine that the
emergency is over.

         9.7 Action Taken in Good Faith. Any corporate action taken in good
faith in accordance with the provisions of this Article Nine binds the
Corporation and may not be used to impose liability on any director, substitute
director, officer, employee or agent of the Corporation.

                                   ARTICLE TEN
                            MISCELLANEOUS PROVISIONS

         10.1 Fiscal Year. The Board of Directors of the Corporation shall have
authority from time to time to determine whether the Corporation shall operate
upon a calendar year basis or upon a fiscal year basis, and if the latter, said
Board of Directors shall have power to determine when the said fiscal year shall
begin and end.


         10.2 Dividends. Dividends on the capital stock of the Corporation may
be declared by the Board of Directors at any regular or special meeting pursuant
to law. Before payment of any dividend, there may be set aside out of any funds
of the Corporation available for dividends such sum or sums as the directors
from time to time, in their absolute discretion, think proper as a reserve fund
to meet contingencies, or for equalizing dividends or for repairing or
maintaining any property of the Corporation, or for such other purposes as the
directors shall think conducive to the interest of the Corporation.

         10.3 Seal. This Corporation shall have a Corporate Seal which shall
consist of an imprint of the name of the Corporation, the state of its
incorporation, the year of incorporation and the words "Corporate Seal." The
Corporate Seal shall not be required to establish the validity or authenticity
of any document executed in the name and on behalf of the Corporation.

         10.4 Notices. Whenever notice is required to be given to any director,
officer or shareholder under any of the provisions of the law, the Charter, or
these Bylaws (except for notice required by Sections 2.8 and 3.6 of these
Bylaws), it shall not be construed to require personal notice, but such notice
may be given in writing by depositing the same in the United States mail,
postage prepaid, or by telegram, teletype, facsimile transmission or other form
of wire, wireless, or other electronic communication or by private carrier
addressed to such shareholder at such address as appears on the Corporation's
current record of shareholders, and addressed to such director or officer at
such address as appears on the records of the Corporation. If mailed as provided
above, notice to a shareholder shall be deemed to be effective at the time when
it is deposited in the mail.

         10.5 Bylaw Amendments. The Board of Directors shall have power to make,
amend and repeal the Bylaws or any Bylaw of the Corporation by vote of not less
than a majority of the directors then in office, at any regular or special
meeting of the Board of Directors. The shareholders may make, amend and repeal
the Bylaws or any Bylaw of this Corporation at any annual meeting or at a
special meeting called for that purpose only by the affirmative vote of the
holders of at least eighty percent (80%) of the voting power of all outstanding
voting stock, and all Bylaws made by the directors may be amended or repealed by
the shareholders only by the vote of the holders of at least eighty percent
(80%) of the voting power of all outstanding voting stock. Without further
authorization, at any time the Bylaws are amended, the Secretary is authorized
to restate the Bylaws to reflect such amendment, and the Bylaws, as so restated,
shall be the Bylaws of the Corporation.

         10.6 Authority to Vote Shares. The Chief Executive Officer,
President-First Tennessee Financial Services, President-First Horizon Financial
Services and President-FTN Financial, or the designee or designees of them or
any of them, are authorized, jointly or severally, to vote all shares (or other
indicia of ownership) beneficially owned by the Company for any purposes and to
take any action on behalf of the Company that is required to be taken by the
Company as a shareholder or other beneficial owner of any entity whose shares
(or other indicia of ownership) are beneficially owned by the Company, which
they, or any of them, deem appropriate at meetings, annual or special, or
without a meeting.



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>ex10-3a.txt
<DESCRIPTION>EXHIBIT 10.3(A)
<TEXT>

<PAGE>


                                                                 EXHIBIT 10.3(a)

           FORM OF PERFORMANCE-ACCELERATED RESTRICTED STOCK AGREEMENT
                   UNDER 1992 RESTRICTED STOCK INCENTIVE PLAN

                              * * * * * * * * * * *

                                                      RESTRICTED STOCK AGREEMENT

Date:
      ---------------

Participant:
             ----------------

Number of Shares:
                  ----------------

     Restricted Stock Agreement ("Agreement") made as of the date specified
above by and between First Tennessee National Corporation (the "Company"),
acting with the prior approval of the Human Resources Committee (the
"Committee") of the Board of Directors and the employee whose name is specified
above, who is an employee of the Company, or one or more of its subsidiaries,
(the "Participant").

     In consideration of the covenants hereinafter set forth, the Company and
the Participant agree as follows:

     1. Award. Pursuant to the terms of the First Tennessee National Corporation
1992 Restricted Stock Incentive Plan (the "Plan"), the Company hereby grants to
the Participant the number of shares specified above (the "Shares") of common
stock of the Company, par value $0.625 per share (the "Common Stock"), subject
to the Restrictions and other conditions hereinafter set forth. So long as any
Shares are subject to the Restrictions set forth in Section 4 hereof, such
Shares shall be deemed to be, and shall be referred to herein as, Restricted
Shares.

     2. Certificates. Each certificate evidencing Restricted Shares shall be
deposited with the Treasurer of the Company, accompanied by a stock power in
blank executed by the Participant, and shall bear the following legend:

     "This certificate and the shares of stock represented hereby are subject to
the terms and conditions (including the risk of forfeiture and restrictions on
transfer) contained in the First Tennessee National Corporation 1992 Restricted
Stock Incentive Plan and a Restricted Stock Agreement entered into between the
registered owner and First Tennessee National Corporation. Release from such
terms and conditions shall occur only in accordance with the provisions of such
Plan and Agreement, a copy of each of which is filed with the Secretary of First
Tennessee National Corporation."

     3. Adjustments in Restricted Shares. In the event of any change in the
outstanding Common Stock by reason of a stock dividend or distribution,
recapitalization, merger, consolidation, split-up, combination, exchange of
shares or the like, the Committee shall make equitable adjustments in the
Restricted Shares corresponding to adjustments made by the Committee in the
number and class of shares of Common Stock which may be issued under the Plan.
Any new, additional or different shares to which the Participant shall be
entitled in respect of Restricted Shares by reason of such adjustment shall be
deemed to be Restricted Shares and shall be subject to the same terms,
conditions, and restrictions as the Restricted Shares so adjusted.

     4. Restrictions. During applicable periods of restriction determined in
accordance with Section 6 of this Agreement, Restricted Shares, and the right to
vote such Shares and to receive dividends thereon, may not be sold, assigned,
transferred, exchanged, pledged, hypothecated or otherwise encumbered, and shall
be subject to the risk of forfeiture contained in Section 5 of this Agreement
(such limitations on transferability and risk of forfeiture being collectively
called the "Restrictions"), but the Participant shall have all other rights of a
stockholder, including, but not limited to, the right to vote and receive
dividends on Restricted Shares.

     5. Forfeiture of Restricted Shares. In the event that the Participant (a)
voluntarily terminates his employment with the Company (including its




<PAGE>


subsidiaries), (b) is discharged from employment with the Company (including its
subsidiaries) as a result of his failure (not caused by death or disability) to
perform the duties of his position faithfully and to the best of his ability, or
(c) is reassigned to a position which, in the opinion of the Committee, reduces
the Participant's opportunity to make an impact upon the profitability of the
Company through his/her decisions, actions and counsel (the events described in
the foregoing clauses (a), (b), and (c) being called herein "Events of
Forfeiture"), all Shares which at the time are Restricted Shares shall be
forfeited by the Participant to the Company without payment of any consideration
by the Company, and neither the Participant, nor any successor, heir, assign or
personal representative of the Participant, shall have any further right to or
interest in such Restricted Shares or the certificate or certificates evidencing
them. Notwithstanding anything herein to the contrary, if a Change in Control
(as defined in Section 9) occurs and if, prior to the date on which the Change
in Control occurs, the Participant's employment with the Company is terminated
or the Participant is reassigned to a position within the meaning of Section
5(c) and if it is reasonably demonstrated by the Participant that such
termination of employment or reassignment of position (i) was at the request of
a third party who has taken steps reasonably calculated to effect a Change in
Control or (ii) otherwise arose in connection with or in anticipation of a
Change in Control, then for all purposes of this Agreement no Shares which at
the time are Restricted Shares shall be forfeited by the Participant to the
Company upon such termination or reassignment, and all Restrictions with respect
to such Shares shall lapse upon the Change in Control.

     6. Lapse of Restrictions.

     (a) Subject to clauses (b) and (c) of this Section 6, the Restrictions
shall lapse with respect to Restricted Shares in accordance with the following
schedule:

<TABLE>
<CAPTION>
Date                                Number of Shares
- ----                                ----------------
<S>                                 <C>
[tenth anniversary of grant date]   All Shares
</TABLE>

     (b) If the Participant's employment with the Company (including its
subsidiaries) ends as a result of any event other than an Event of Forfeiture,
all Restrictions shall forthwith lapse as to all Restricted Shares.

     (c) Notwithstanding the provisions of clause (a), but subject to clause (b)
of this Section 6, the Restrictions shall lapse with respect to the Restricted
Shares in accordance with the following schedule if the performance criteria
established by the Committee for the performance period at the beginning of such
period (or on the date hereof for the initial performance period) are achieved:

<TABLE>
<CAPTION>
Performance Period                                      Number of Shares   Date of Lapse
- ------------------                                      ----------------   -------------
<S>                                                       <C>              <C>
[three calendar years beginning year of grant]            ____________     [April of year following perf. period]
[three calendar years beginning 1st year after grant]     ____________     [April of year following perf. period]
[three calendar years beginning 2nd year after grant]     ____________     [April of year following perf. period]
</TABLE>

Each lapse of Restrictions provided for in this clause (c) is noncumulative. In
other words, if performance criteria for any performance period are not
achieved, Restrictions with respect to the indicated Restricted Shares shall not
lapse until the date specified in clause (a).

     (d) Upon lapse of the Restrictions in accordance with this Section 6 or
Section 9, new certificates evidencing the Shares with respect to which the
Restrictions have lapsed, without the foregoing restrictive legend, shall be
issued to the Participant or his legal representative, against cancellation of
the legended certificates. Each such new certificate shall bear a legend
reflecting any restrictions upon the transferability of such Shares imposed by
law, such as the Securities Act of 1933.

     7. Valuation of shares. For purposes of this Agreement, the fair market
value of the Shares on any date (a "Valuation Date") shall be deemed to be the
mean between the highest and lowest selling prices of the Common Stock on
Valuation Date as quoted by NASDAQ's national list of over-the-counter
securities as reported in The Wall Street Journal over-the-counter markets, or
other authorized sources, or, in the event the common stock is not traded on a
Valuation Date, the average of the mean between such highest and lowest prices
on the last trading day preceding, and the first trading day following, the
Valuation Date. Provided, however, if the Common Stock is listed on a national


                                       2




<PAGE>


securities exchange the fair market value of the Shares shall be deemed to be
the mean between the highest and lowest selling prices of the Common Stock on
the exchange on the Valuation Date, or, in the event the Common Stock is not
traded on a Valuation Date, the average of the mean between such highest and
lowest selling prices of the Common Stock on such exchange on the last trading
day preceding, and the first trading day following, the Valuation Date.

     8. Withholding Requirements. Whenever payments hereunder are to be made in
cash, or Restrictions lapse with respect to Restricted Shares, the Company shall
have the right to withhold from sums due to the Participant (or to require the
Participant to remit to the Company) an amount sufficient to satisfy any
federal, state or local withholding tax requirements prior to making such
payments or delivering any certificate evidencing such Shares.

     9. Change in Control. Notwithstanding anything herein to the contrary, all
Restrictions with respect to the Restricted Shares imposed by the Plan or this
Agreement shall lapse immediately upon a Change in Control (as defined in the
following sentence). A "Change in Control" means the occurrence of any one of
the following events:

          (I) individuals who, on January 21, 1997, constitute the Board (the
     "Incumbent Directors") cease for any reason to constitute at least a
     majority of the Board, provided that any person becoming a director
     subsequent to January 21, 1997, whose election or nomination for election
     was approved by a vote of at least three-fourths (3/4) of the Incumbent
     Directors then on the Board (either by a specific vote or by approval of
     the proxy statement of the Company in which such person is named as a
     nominee for director, without written objection to such nomination) shall
     be an Incumbent Director; provided, however, that no individual elected or
     nominated as a director of the Company initially as a result of an actual
     or threatened election contest with respect to directors or as a result of
     any other actual or threatened solicitation of proxies or consents by or on
     behalf of any person other than the Board shall be deemed to be an
     Incumbent Director;

          (ii) any "Person" (as defined under Section 3(a)(9) of the Securities
     Exchange Act of 1934, as amended (the "Exchange Act") and as used in
     Section 13(d) or Section 14(d) of the Exchange Act) is or becomes a
     "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
     directly or indirectly, of securities of the Company representing 20% or
     more of the combined voting power of the Company's then outstanding
     securities eligible to vote for the election of the Board (the "Company
     Voting Securities"); provided, however, that the event described in this
     paragraph (ii) shall not be deemed to be a change in control by virtue of
     any of the following acquisitions: (A) by the Company or any entity in
     which the Company directly or indirectly beneficially owns more than 50% of
     the voting securities or interests (a "Subsidiary"), (B) by an employee
     stock ownership or employee benefit plan or trust sponsored or maintained
     by the Company or any Subsidiary, (C) by any underwriter temporarily
     holding securities pursuant to an offering of such securities, or (D)
     pursuant to a Non-Qualifying Transaction (as defined in paragraph (iii));

          (iii) the shareholders of the Company approve a merger, consolidation,
     share exchange or similar form of corporate transaction involving the
     Company or any of its Subsidiaries that requires the approval of the
     Company's shareholders, whether for such transaction or the issuance of
     securities in the transaction (a "Business Combination"), unless
     immediately following such Business Combination: (A) more than 50% of the
     total voting power of (x) the corporation resulting from such Business
     Combination (the "Surviving Corporation"), or (y) if applicable, the
     ultimate parent corporation that directly or indirectly has beneficial
     ownership of 100% of the voting securities eligible to elect directors of
     the Surviving Corporation (the "Parent Corporation"), is represented by
     Company Voting Securities that were outstanding immediately prior to the
     consummation of such Business Combination (or, if applicable, is
     represented by shares into which such Company Voting Securities were
     converted pursuant to such Business Combination), and such voting power
     among the holders thereof is in substantially the same proportion as the
     voting power of such Company Voting Securities among the holders thereof
     immediately prior to the Business Combination, (B) no person (other than
     any employee benefit plan sponsored or maintained by the Surviving
     Corporation or the Parent Corporation), is or becomes the beneficial owner,
     directly or indirectly, of 20% or more of the total voting power of the
     outstanding voting securities eligible to elect directors of the Parent
     Corporation (or, if there is no Parent Corporation, the Surviving
     Corporation) and (C) at least a majority of the members of the board of
     directors of the Parent Corporation (or, if there is no Parent Corporation,
     the Surviving Corporation) were Incumbent Directors at the time of the
     Board's approval of the execution of the initial agreement providing for
     such Business Combination (any Business Combination which satisfies all of
     the criteria specified in (A), (B) and (C) above shall be deemed to be a
     "Non-Qualifying Transaction"); or


                                        3




<PAGE>


          (iv) the shareholders of the Company approve a plan of complete
     liquidation or dissolution of the Company or a sale of all or substantially
     all of the Company's assets.

     Computations required by paragraph (iii) shall be made on and as of the
     date of shareholder approval and shall be based on reasonable assumptions
     that will result in the lowest percentage obtainable.

     Notwithstanding the foregoing, a Change in Control of the Company shall not
be deemed to occur solely because any person acquires beneficial ownership of
more than 20% of the Company Voting Securities as a result of the acquisition of
Company Voting Securities by the Company which reduces the number of Company
Voting Securities outstanding; provided, that if after such acquisition by the
Company such person becomes the beneficial owner of additional Company Voting
Securities that increases the percentage of outstanding Company Voting
Securities beneficially owned by such person, a change in control of the Company
shall then occur.

     10. Tax Elections. The Participant agrees not to make an election in
accordance with Section 83(b) of the Internal Revenue Code of 1986, as amended,
to include in his gross income for federal income tax purposes the value of the
Restricted Shares in the year in which this Agreement is made.

     11. Deferrals. Section 16 of the Plan permits certain participants, whose
Agreement so provides, to make deferral elections with respect to an award under
the Plan. Participant is eligible to make a deferral election pursuant to
Section 16 of the Plan with respect to one or more deferral periods by complying
with the provisions of Section 16.

     12. Effect on Employment. Nothing contained in this Agreement shall confer
upon the participant the right to continue in the employment of the Company
(including its subsidiaries) or affect any right which the Company (including
its subsidiaries) may have to terminate the employment of the Participant.

     13. Amendment. This Agreement may not be amended except with the consent of
the Committee and by a written instrument duly executed by the Participant and
the Company.

     14. Binding Effect. This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their heirs, personal representatives,
successors and assigns.

     IN WITNESS WHEREOF, each of the Company and the Participant has executed
and delivered this Agreement as of the day and year first above written.

ATTEST                                    FIRST TENNESSEE NATIONAL CORPORATION


By:                                       By:
    ----------------------------------        ----------------------------------
                    , Secretary               [Name of Authorized Officer]
- --------------------                          [Title of Authorized Officer]

- --------------------------------------
   Participant


                                        4


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>4
<FILENAME>ex10-3b.txt
<DESCRIPTION>EXHIBIT 10.3(B)
<TEXT>

<PAGE>


                                                                 EXHIBIT 10.3(b)

           FORM OF PERFORMANCE-ACCELERATED RESTRICTED STOCK AGREEMENT
                       UNDER 2003 EQUITY COMPENSATION PLAN

                              * * * * * * * * * * *

                                                      RESTRICTED STOCK AGREEMENT

Date:
      --------------

Participant:
             --------------

Number of Shares:
                  ----------------

     Restricted Stock Agreement ("Agreement") made as of the date specified
above by and between First Horizon National Corporation (the "Company"), acting
with the prior approval of the Compensation Committee (the "Committee") of the
Board of Directors and the employee whose name is specified above, who is an
employee of the Company, or one or more of its subsidiaries, (the
"Participant").

     In consideration of the covenants hereinafter set forth, the Company and
the Participant agree as follows:

     1. Award. Pursuant to the terms of the First Horizon National Corporation
2003 Equity Compensation Plan (the "Plan"), the Company hereby grants to the
Participant the number of shares specified above (the "Shares") of common stock
of the Company, par value $0.625 per share (the "Common Stock"), subject to the
Restrictions and other conditions hereinafter set forth. So long as any Shares
are subject to the Restrictions set forth in Section 3 hereof, such Shares shall
be deemed to be, and shall be referred to herein as, Restricted Shares.

     2. Certificates. Each certificate evidencing Restricted Shares shall be
deposited with the Treasurer of the Company, accompanied by a stock power in
blank executed by the Participant, or shall be held in book-entry form at the
Company's transfer agent, and shall bear the following legend:

     "This certificate and the shares of stock represented hereby are subject to
the terms and conditions (including the risk of forfeiture and restrictions on
transfer) contained in the First Horizon National Corporation 2003 Equity
Compensation Plan and a Restricted Stock Agreement entered into between the
registered owner and First Horizon National Corporation. Release from such terms
and conditions shall occur only in accordance with the provisions of such Plan
and Agreement, a copy of each of which is filed with the Secretary of First
Horizon National Corporation."

     3. Restrictions. During applicable periods of restriction determined in
accordance with Section 5 of this Agreement, Restricted Shares, and the right to
vote such Shares and to receive dividends thereon, may not be sold, assigned,
transferred, exchanged, pledged, hypothecated or otherwise encumbered, and shall
be subject to the risk of forfeiture contained in Section 4 of this Agreement
(such limitations on transferability and risk of forfeiture being collectively
called the "Restrictions"), but the Participant shall have all other rights of a
stockholder, including, but not limited to, the right to vote and receive
dividends on Restricted Shares.

     4. Forfeiture of Restricted Shares. In the event that the Participant (a)
voluntarily terminates his employment with the Company (including its
subsidiaries), (b) is discharged from employment with the Company (including its
subsidiaries) as a result of his failure (not caused by death or Disability (as
defined in the Plan)) to perform the duties of his position faithfully and to
the best of his ability, or (c) except in connection with a Change in Control as
described below, is reassigned to a position which, in the opinion of the
Committee, reduces the Participant's opportunity to make an impact upon the
profitability of the Company through his/her decisions, actions and counsel (the
events described in the foregoing clauses (a), (b), and (c) being called herein
"Events of Forfeiture"), all Shares which at the time are Restricted Shares
shall be forfeited by the Participant to the Company without payment of any
consideration by the Company, and neither the Participant, nor any successor,
heir, assign or personal representative of the Participant, shall have any
further right to or interest in such Restricted Shares or any certificate or
certificates evidencing them. Notwithstanding anything herein to the contrary,
if a Change in Control




<PAGE>


(as defined in the Plan) occurs and if, prior to the date on which the Change in
Control occurs, the Participant's employment with the Company is terminated or
the Participant is reassigned to a position within the meaning of Section 4(c)
and if it is reasonably demonstrated by the Participant that such termination of
employment or reassignment of position (I) was at the request of a third party
who has taken steps reasonably calculated to effect a Change in Control or (ii)
otherwise arose in connection with or in anticipation of a Change in Control,
then for all purposes of this Agreement such termination or reassignment shall
not be deemed an Event of Forfeiture, no Shares which at the time are Restricted
Shares shall be forfeited by the Participant to the Company upon such
termination or reassignment, and all Restrictions with respect to such Shares
shall lapse upon the Change in Control.

     5. Lapse of Restrictions.

     (a) Subject to clauses (b) and (c) of this Section 5, the Restrictions
shall lapse with respect to Restricted Shares in accordance with the following
schedule:

<TABLE>
<CAPTION>
Date                                Number of Shares
- ----                                ----------------
<S>                                 <C>
[tenth anniversary of grant date]   All Shares
</TABLE>

     (b) If the Participant's employment with the Company (including its
subsidiaries) ends as a result of any event other than an Event of Forfeiture,
all Restrictions shall forthwith lapse as to all Restricted Shares.

     (c) Notwithstanding the provisions of clause (a), but subject to clause (b)
of this Section 5, the Restrictions shall lapse with respect to the Restricted
Shares in accordance with the following schedule if the performance criteria
established by the Committee for the performance period at the beginning of such
period (or on the date hereof for the first and second performance periods) are
achieved:

<TABLE>
<CAPTION>
Performance Period                                      Number of Shares   Date of Lapse
- ------------------                                      ----------------   -------------
<S>                                                     <C>                <C>
[three calendar years beginning year of grant]          __________         [April of year following perf. period]
[three calendar years beginning 1st year after grant]   __________         [April of year following perf. period]
[three calendar years beginning 2nd year after grant]   __________         [April of year following perf. period]
</TABLE>

Each lapse of Restrictions provided for in this clause (c) is noncumulative. In
other words, if performance criteria for any performance period are not
achieved, Restrictions with respect to the indicated Restricted Shares shall not
lapse until the date specified in clause (a).

     (d) Upon lapse of the Restrictions in accordance with this Section 5 or
Section 7, new certificates evidencing the Shares with respect to which the
Restrictions have lapsed, without the foregoing restrictive legend, shall be
issued to the Participant or his legal representative, against cancellation of
the legended certificates, or, if applicable, the Company's transfer agent shall
be directed to remove the legend from Shares held in book-entry form. Each such
new certificate, and any Shares held in book-entry form, shall bear a legend
reflecting any restrictions upon the transferability of such Shares imposed by
law, such as the Securities Act of 1933.

     6. Withholding Requirements. Whenever payments hereunder are to be made in
cash, or Restrictions lapse with respect to Restricted Shares, the Company shall
have the right to withhold from sums due to the Participant (or to require the
Participant to remit to the Company) an amount sufficient to satisfy any
federal, state or local withholding tax requirements prior to making such
payments or delivering any certificate evidencing such Shares.

     7. Change in Control. Notwithstanding anything herein to the contrary, all
Restrictions with respect to the Restricted Shares imposed by the Plan or this
Agreement shall lapse immediately upon a Change in Control (as defined in the
Plan).

     8. Tax Elections. The Participant agrees not to make an election in
accordance with Section 83(b) of the Internal Revenue Code of 1986, as amended,
to include in his gross income for federal income tax purposes the value of the
Restricted Shares in the year in which this Agreement is made.


                                       2




<PAGE>


     9. Deferrals. Section 3(A)(vii) of the Plan permits certain participants,
whose Agreement so provides, to make deferral elections with respect to an award
under the Plan. Participant is eligible to make a deferral election pursuant to
Section 3(A)(vii) of the Plan with respect to one or more deferral periods by
complying with the procedures established by the Committee.

     10. Effect on Employment. Nothing contained in this Agreement shall confer
upon the participant the right to continue in the employment of the Company
(including its subsidiaries) or affect any right which the Company (including
its subsidiaries) may have to terminate the employment of the Participant.

     11. Amendment. This Agreement may not be amended except with the consent of
the Committee and by a written instrument duly executed by the Participant and
the Company.

     12. Binding Effect. This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their heirs, personal representatives,
successors and assigns.

     IN WITNESS WHEREOF, each of the Company and the Participant has executed
and delivered this Agreement as of the day and year first above written.

ATTEST                                   FIRST HORIZON NATIONAL CORPORATION


By:                                      By:
    ----------------------------------       -----------------------------------
              , Secretary                    Senior Vice President, Compensation
                                               and Benefits


- --------------------------------------
            Participant


                                       3


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>5
<FILENAME>ex10-3c.txt
<DESCRIPTION>EXHIBIT 10.3(C)
<TEXT>

<PAGE>


                                                                 EXHIBIT 10.3(c)

The following is a description of the performance criteria used for
performance-accelerated restricted stock (TARSAP and PARSAP) awards granted
prior to 2005 under the 1992 Restricted Stock Incentive Plan and the 2003 Equity
Compensation Plan:

The primary performance criteria are based on the Company's total shareholder
return (TSR) targets established at the beginning of each performance period.
Through 2004, TSR targets are based on the Company's percentile ranking in the
100-bank peer group discussed below, with the condition that TSR must be a
positive number. If the TSR targets are not met, the award may still vest on an
accelerated basis if certain alternative criteria are achieved. Those
alternative criteria are based upon our percentile ranking within the 100-bank
peer group with respect to a certain operating earnings per share (EPS) growth
rate and a certain percentile ranking based on operating return on equity (ROE);
however, vesting will not accelerate unless TSR is a positive number. The
100-bank peer group used for this purpose consists of approximately the 100
largest banking organizations by asset size traded on U.S. exchanges, measured
at the time of each grant.


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>6
<FILENAME>ex10-4a.txt
<DESCRIPTION>EXHIBIT 10.4(A)
<TEXT>

<PAGE>


                                                                 EXHIBIT 10.4(a)

                                    NOTICE OF
             2003 LONG-TERM INCENTIVE PLAN AWARD ("2003 LTIP AWARD")
                       UNDER 2003 EQUITY COMPENSATION PLAN

1.0  OBJECTIVE:

     The purpose of the Long-Term Incentive Plan Award ("LTIP") pursuant to
     Section 8 of First Horizon National Corporation's 2003 Equity Compensation
     Plan (the "Plan") is to provide motivation for key executives to achieve
     the Company's strategic objectives and ensure incentive rewards and
     performance are linked to shareholder value.

2.0  LTIP PERFORMANCE PERIOD:

     The LTIP performance period will be the Company's fiscal years beginning
     January 1, 2003 and ending December 31, 2005.

3.0  ELIGIBILITY:

          o    Eligibility for executive officers who are subject to Section 16
               (as defined in the Plan) or who are Covered Officers (as defined
               in the Plan) is approved annually by the Compensation Committee
               ("Committee").

          o    Eligibility for all other executives is approved annually by the
               CEO.

4.0  FUNDING OF THE INCENTIVE POOL:

o    As soon as possible following the end of the Performance Period, the
     Committee shall determine the 2003 LTIP Award earned by each Participant in
     the manner described in Sections 4.0 and 5.0 of this Notice (the "Earned
     Award").

o    The amount by which the Company will fund the incentive pool from which all
     of the Participants' 2003 LTIP Awards will be paid will be determined based
     on the higher of the following two criteria established by the Compensation
     Committee: (1) the Company's price/earnings ratio ("P/E Ratio") relative to
     the Peer Group (as defined below) as of the Measurement Date or (2) the
     compound annual growth rate ("CAGR") in the Company's stock price.

     o    The Company's relative P/E Ratio measurement criterion is as follows:

          o    If the Company's P/E Ratio equals the ____th percentile of the
               P/E Ratio of the Peer Group, an incentive pool will be funded
               equal to 20% of the maximum aggregate potential 2003 LTIP Award
               of all the Participants. The "Peer Group" shall be the "Top 50
               Banks" as identified by American Banker at the beginning of the
               Performance Period.


                                        1




<PAGE>


          o    If the Company's P/E Ratio equals the ____th percentile of the
               P/E Ratio of the Peer Group, an incentive pool will be funded
               equal to 100% of the maximum aggregate potential 2003 LTIP Award
               of all the Participants.

          o    Straight line interpolation will be used to fund the incentive
               pool when performance is between the ____th and ____th percentile
               of the Peer Group.

          o    Regardless of Company's relative performance, no incentives will
               be funded or paid unless the Company's P/E Ratio increases during
               the Performance Period.

          o    The P/E Ratio at the beginning of the Performance Period is 12.3.

          o    The initial Performance Period covers 3 years (2003 - 2005), and
               the Measurement Date for the initial Performance Period will be
               January 31, 2006.

          o    The numerator of the P/E Ratio will be based on the
               60-trading-day average closing price for the period ending
               January 31, as reported by The Wall Street Journal, unless the
               Committee selects another period (e.g., due to market volatility
               or rumors of potential transactions).

          o    The denominator of the P/E Ratio will be the Company's actual
               earnings for the year ended 12/31/05, unless the Committee
               approves a different period.

          o    If, at the end of the Performance Period, the Committee
               determines that the Company's P/E Ratio is distorted (positively
               or negatively) by market volatility (e.g., due to speculation
               about potential business combinations), then the Committee may
               adjust the incentive pool. Alternatively, the Committee may
               direct the Company to calculate its relative P/E Ratio over a
               longer or shorter period of time (i.e., 90 days rather than 60
               days) or otherwise determine a normalized P/E Ratio for
               comparison to the Peer Group.

     o    The stock price CAGR measurement criterion is as follows:

          o    Target based on 2003-2005 strategic plan as presented to the
               board in October, 2002.

          o    100% payout earned only if stock price CAGR represents
               significant return to shareholders as indicated in the following
               grid:

<TABLE>
<CAPTION>
                                 CAGR   =>   Payout %
                                 ----        --------
                                 <S>         <C>
                                 ___%          100%
                                 ___            75
                                 ___            50
                                 ___            25
                                 ___           -0-
</TABLE>

     o    The amount of the incentive pool funded may be reduced by the
          Committee in order to more accurately reflect the Company's total
          performance. In determining the amount, if any, by which the incentive
          pool will be reduced, the Committee may consider measures such as the
          following:


                                       2




<PAGE>


<TABLE>
<CAPTION>
     --------------------------------------
     Factor            Guideline
     --------------------------------------
<S>                    <C>
     Rating Agencies   [guideline redacted]
     --------------------------------------
     Regulatory        [guideline redacted]
     --------------------------------------
     Capitalization    [guideline redacted]
     --------------------------------------
     Governance        [guideline redacted]
     --------------------------------------
</TABLE>

     Failure to meet the guideline for any one of the above factors may in the
     Committee's discretion result in a 20% reduction, up to a total reduction
     of 80%, of the incentive pool.

5.0  DETERMINATION OF INDIVIDUAL PARTICIPANT'S MAXIMUM EARNED AWARD AND PAYMENT
     OF AWARD:

     The objective of the LTIP is to deliver a total annual award up to 75% of
     the maximum bonus potential for each individual Participant under his/her
     respective annual bonus plan for the Performance Period (MIP or
     FirstPower). The incentive pool available will be determined based on the
     applicable performance criteria outlined in Section 4.0 above. Each
     Participant's maximum Earned Award will be calculated as follows:

[Standard version formula:]

     o    Annual  LTIP Value = Eligible  Base  Salary  times  Annual  Bonus Plan
          Target Percentage times 0.75

[Formula applicable to executives whose bonuses are based on a measure of
business unit earnings:]

     o    Annual LTIP Value = Eligible Base Salary times 0.75

     The Annual LTIP Value will be determined  for each calendar year during the
     Performance  Period.  At the end of the  Performance  Period,  the  maximum
     Earned Award will be determined as follows:

     o    Earned Award = (2003 Annual LTIP Value + 2004 Annual LTIP Value + 2005
          Annual LTIP  Value)  times  (percentage  of  incentive  pool funded as
          described in Section 4.0 above).

     o    Notwithstanding  anything to the contrary herein, the Committee may in
          its discretion choose to award a Participant less than his/her maximum
          Earned Award as calculated above,  taking into account such factors as
          it may deem relevant,  including but not limited to the  Participant's
          achievement  of his/her  bonus  objectives  under  his/her  applicable
          annual bonus plan.

     o    Notwithstanding  anything to the contrary  herein,  the  Committee may
          delay the  payment  of any  Earned  Award for a period of up to a year
          after the Measurement Date.


                                      3




<PAGE>


6.0  TERMINATION OF EMPLOYMENT AND FORFEITURE OF AWARD:

     Except as may otherwise be determined by the Committee, in the event that
     the Participant's employment with the Company (including its subsidiaries)
     terminates for any reason prior to the end of the Performance Period, the
     2003 LTIP Award shall be forfeited, and neither the Participant, nor any
     successor, heir, assign or personal representative of the Participant,
     shall have any further right to or interest in the 2003 LTIP Award.
     Notwithstanding anything herein to the contrary, if a Change in Control (as
     defined in Section 7) occurs and if, prior to the date on which the Change
     in Control occurs, the Participant's employment with the Company is
     terminated or the Participant is reassigned to a position which in the
     opinion of the Committee reduces the Participant's ability to make an
     impact upon the profitability of the Company through his/her decisions,
     actions and counsel and if it is reasonably demonstrated by the Participant
     that such termination of employment or reassignment of position (i) was at
     the request of a third party who has taken steps reasonably calculated to
     effect a Change in Control or (ii) otherwise arose in connection with or in
     anticipation of a Change in Control, then for all purposes of this Notice
     the 2003 LTIP Award shall not be forfeited by the Participant to the
     Company upon such termination or reassignment, and the amount of the 2003
     LTIP Award shall be determined by the Committee as described in Section 7.0
     below and shall vest and be payable immediately upon the Change in Control.

7.0  CHANGE IN CONTROL:

     Notwithstanding anything herein to the contrary, upon a Change in Control,
     the Committee shall determine the amount of the 2003 LTIP Award in the
     manner set forth in this Section 7.0 (the "CIC LTIP Award"). The CIC LTIP
     Award shall equal the maximum potential 2003 LTIP Award, prorated to
     reflect the percentage of the Performance Period that has elapsed between
     the beginning of the Performance Period and the date of the Change in
     Control. The CIC LTIP Award shall vest and be immediately payable upon a
     Change in Control. A "Change in Control" means the occurrence of any one of
     the following events.

     (i)  individuals who, on January 21, 1997, constitute the Board (the
          "Incumbent Directors") cease for any reason to constitute at least a
          majority of the Board, provided that any person becoming a director
          subsequent to January 21, 1997, whose election or nomination for
          election was approved by a vote of at least three-fourths (3/4) of the
          Incumbent Directors then on the Board (either by a specific vote or by
          approval of the proxy statement of the Company in which such person is
          named as a nominee for director, without written objection to such
          nomination) shall be an Incumbent Director; provided, however, that no
          individual elected or nominated as a director of the Company initially
          as a result of an actual or threatened election contest with respect
          to directors or as a result of any other actual or threatened
          solicitation of proxies or consents by


                                       4




<PAGE>


          or on behalf of any person other than the Board shall be deemed to be
          an Incumbent Director;

     (ii) any "Person" (for purposes of this definition only, as defined under
          Section 3(a)(9) of the Securities Exchange Act of 1934, as amended
          (the "Exchange Act") and as used in Section 13(d) or Section 14(d) of
          the Exchange Act) is or becomes a "beneficial owner" (as defined in
          Rule 13d-3 under the Exchange Act), directly or indirectly, of
          securities of the Company representing 20% or more of the combined
          voting power of the Company's then outstanding securities eligible to
          vote for the election of the Board (the "Company Voting Securities")
          provided, however, that the event described - in this paragraph (ii)
          shall not be deemed to be a Change in Control by virtue of any of the
          following acquisitions: (A) by the Company or any entity in which the
          Company directly or indirectly beneficially owns more than 50% of the
          voting securities or interest (a "Subsidiary"), (B) by an employee
          stock ownership or employee benefit plan or trust sponsored or
          maintained by the Company or any Subsidiary, (C) by any underwriter
          temporarily holding securities pursuant to an offering of such
          securities, or (D) pursuant to a Non-Qualifying Transaction (as
          defined in paragraph (iii);

     (iii) the shareholders of the Company approve a merger, consolidation,
          share exchange or similar form of corporate transaction involving the
          Company or any of its Subsidiaries that requires the approval of the
          Company's shareholders, whether for such transaction or the issuance
          of securities in the transaction (a "Business Combination"), unless
          immediately following such Business Combination: (A) more than 50% of
          the total voting power of (x) the corporation resulting from such
          Business Combination (the "Surviving Corporation"), or (y) if
          applicable, the ultimate parent corporation that directly or
          indirectly has beneficial ownership of 100% of the voting securities
          eligible to elect directors of the Surviving Corporation (the "Parent
          Corporation"), is represented by Company Voting Securities that were
          outstanding immediately prior to the consummation of such Business
          Combination (or, if applicable, is represented by shares into which
          such Company Voting Securities were converted pursuant to such
          Business Combination), and such voting power among the holders thereof
          is in substantially the same proportion as the voting power of such
          Company Voting Securities among the holders thereof immediately prior
          to the Business Combination, (B) no Person (other than any employee
          benefit plan sponsored or maintained by the Surviving Corporation or
          the Parent Corporation), is or becomes the beneficial owner, directly
          or indirectly, of 20% or more of the total voting power of the
          outstanding voting securities eligible to elect directors of the
          Parent Corporation (or, if there is no Parent Corporation, the
          Surviving Corporation) and (C) at least a majority of the members of
          the board of directors of the Parent Corporation (or, if there is no
          Parent Corporation, the Surviving Corporation) were Incumbent
          Directors at the time of the Board's approval of the execution of the
          initial agreement providing for such Business Combination (any
          Business Combination which


                                       5




<PAGE>


          satisfies all of the criteria specified in (A), (B) and (C) above
          shall be deemed to be a "Non-Qualifying Transaction"); or

     (iv) the shareholders of the Company approve a plan of complete liquidation
          or dissolution of the Company or a sale of all or substantially all of
          the Company's assets.

     Computations required by paragraph (iii) shall be made on and as of the
     date of shareholder approval and shall be based on reasonable assumptions
     that will result in the lowest percentage obtainable. Notwithstanding the
     foregoing, a Change in Control of the Company shall not be deemed to have
     occurred solely because any Person acquires beneficial ownership of more
     than twenty percent (20%) of the Company Voting Securities as a result of
     the acquisition of Company Voting Securities by the Company which reduces
     the number of Company Voting Securities outstanding; provided, that if
     after such acquisition by the Company such Person becomes the beneficial
     owner of additional Company Voting Securities that increases the percentage
     of outstanding Company Voting Securities beneficially owned by such Person,
     a Change in Control of the Company shall then occur.

8.0  EFFECT ON EMPLOYMENT:

     Nothing contained in the LTIP shall confer upon the Participant the right
     to continue in the employment of the Company (including its subsidiaries)
     or affect any right that the Company (including its subsidiaries) may have
     to terminate the employment of the Participant.

9.0  AMENDMENT:

     The 2003 LTIP Awards may not be amended except with the consent of the
     Committee.

10.0 WITHHOLDING:

     Whenever payments hereunder are to be made in cash, the Company shall have
     the right to withhold from sums due to the Participant (or to require the
     Participant to remit to the Company) an amount sufficient to satisfy any
     federal, state or local withholding tax requirements prior to making such
     payments.


                                       6




<PAGE>


Participant:
             --------------
Date of Award: April 17, 2003
Number of Shares:
                  ---------

Restricted Stock Agreement ("Agreement") by and between First Horizon National
Corporation (the "Company"), acting with the prior approval of the Compensation
Committee (the "Committee") of the Board of Directors, and the employee whose
name is specified above, who is an employee of the Company or one or more of its
subsidiaries (the "Participant").

Whereas, the Participant has been granted an award (the "2003 LTIP Award") under
Section 8 of the First Tennessee National Corporation 2003 Equity Compensation
Plan (the "Plan"), contingent on the achievement of specified performance goals
over a three-year performance period beginning January 1, 2003 and ending on
December 31, 2005 (the "Performance Period").

Whereas, a portion of the 2003 LTIP Award will be paid in shares of common stock
of the Company, par value $0.625 per share (the "Common Stock").

Now, therefore, in consideration of the covenants hereinafter set forth, the
Company and the Participant agree as follows:

     1.   Award. Pursuant to the terms of the Plan, the Company hereby grants to
          the Participant the number of shares of Common Stock specified above
          (the "Shares"), subject to the Restrictions and other conditions set
          forth herein. So long as any Shares are subject to the Restrictions
          set forth in Section 4 hereof, such Shares shall be deemed to be, and
          shall be referred to herein as, Restricted Shares.

     2.   Certificates. Each certificate evidencing Restricted Shares shall be
          deposited with the Treasurer of the Company, accompanied by a stock
          power in blank executed by the Participant, and shall bear the
          following legend (or alternatively, in the discretion of the Company,
          shall be held in book entry form at the Company's transfer agent,
          subject to the same legend):

          "This certificate and shares of stock represented hereby are subject
          to the terms and conditions (including the risk of forfeiture and
          restrictions on transfer) contained in a Restricted Stock Agreement
          entered into pursuant to the First Tennessee National Corporation 2003
          Equity Compensation Plan between the registered owner and First
          Horizon National Corporation. Release from such terms and conditions
          shall occur only in accordance with the provisions of such Plan and
          Agreement, a copy of each of which is filed with the Secretary of
          First Horizon National Corporation."

     3.   Adjustments in Restricted Shares. The number of Restricted Shares
          covered by this Agreement shall be proportionately adjusted for any
          increase or decrease in


                                       7




<PAGE>


          the number of issued shares of Common Stock resulting from a stock
          split, reverse stock split, stock dividend, recapitalization,
          combination or reclassification of the Common Stock, and may be
          proportionately adjusted, as determined in the sole discretion of the
          Board of Directors of the Company, for any other increase or decrease
          in the number of issued shares of Common Stock effected without
          receipt of consideration by the Company or to reflect any
          distributions to holders of shares of Common Stock other than regular
          cash dividends. Any new, additional or different shares to which the
          Participant shall be entitled in respect of Restricted Shares by
          reason of such adjustment shall be deemed to be Restricted Shares and
          shall be subject to the same terms, conditions, and restrictions as
          the Restricted Shares so adjusted.

     4.   Restrictions. During applicable periods of restriction determined in
          accordance with Section 6 of this Agreement, Restricted Shares, and
          the right to vote such Shares and to receive dividends thereon may not
          be sold, assigned, transferred, exchanged, pledged, hypothecated or
          otherwise encumbered, and shall be subject to the forfeiture
          provisions contained in Section 5 of this Agreement (such limitations
          on transferability and risk of forfeiture being collectively called
          the "Restrictions"), but the Participant shall have all other rights
          of a shareholder, including but not limited to, the right to vote and
          receive dividends on Restricted Shares; provided, however, that
          effective as of July 20, 2004, the Participant shall have no right to
          receive any dividends on the Restricted Shares for so long as they
          remain subject to the Restrictions.

     5.   Forfeiture of Restricted Shares. Except as may otherwise be determined
          by the Committee, in the event that the Participant's employment with
          the Company (including its subsidiaries) terminates for any reason
          prior to the end of the Performance Period, all Shares which at the
          time are Restricted Shares shall be forfeited by the Participant to
          the Company without payment of any consideration by the Company, and
          the cash portion (if any) of the 2003 LTIP Award shall be forfeited,
          and neither the Participant, nor any successor, heir, assign or
          personal representative of the Participant, shall have any further
          right to or interest in such 2003 LTIP Award, Restricted Shares or the
          certificate or certificates evidencing them. Notwithstanding anything
          herein to the contrary, if a Change in Control (as defined in Section
          9) occurs and if, prior to the date on which the Change in Control
          occurs, the Participant's employment with the Company is terminated or
          the Participant is reassigned to a position which in the opinion of
          the Committee reduces the Participant's ability to make an impact upon
          the profitability of the Company through his/her decisions, actions
          and counsel and if it is reasonably demonstrated by the Participant
          that such termination of employment or reassignment of position (i)
          was at the request of a third party who has taken steps reasonably
          calculated to effect a Change in Control or (ii) otherwise arose in
          connection with or in anticipation of a Change in Control, then for
          all purposes of this Agreement the amount of the 2003 LTIP Award shall
          be determined by the Committee as described in Section 9 below and
          shall vest and be payable immediately upon the Change in Control as
          described in Section 9 below.


                                       8




<PAGE>


     6.   Lapse of Restrictions.

          (a)  As soon as practicable following the end of the Performance
               Period, the Committee shall determine the 2003 LTIP Award earned
               by the Participant in the manner described in Exhibit A (the
               "Earned Award"). If the fair market value of the Shares on the
               Measurement Date (as defined in Exhibit A) is less than the
               Earned Award, the Restrictions on all of the Shares will lapse
               and the difference will be paid in cash. If the fair market value
               of the Shares on the Measurement Date exceeds the Earned Award,
               then Restrictions will lapse only as to the number of Shares, the
               fair market value of which is equal to the amount necessary to
               fund the Earned Award (if any), and any remaining shares will be
               forfeited.

          (b)  Notwithstanding the foregoing, the Committee may delay the
               vesting of the Shares and the payment of the cash portion (if
               any) of any Earned Award earned in accordance with paragraph (a)
               of this Section 6 for a period of up to a year after the
               Measurement Date.

          (c)  Upon lapse of the Restrictions in accordance with this Section 6
               or Section 9, new certificates evidencing the Shares with respect
               to which the Restrictions have lapsed, without a restrictive
               legend, shall be issued to the Participant or his legal
               representative, against cancellation of the legended
               certificates. Each such new certificate shall bear a legend
               reflecting any restrictions upon the transferability of such
               shares imposed by law, such as the Securities Act of 1933.

     7.   Valuation of Shares. For purposes of this Agreement, the fair market
          value with respect to the Shares, shall mean, as of any date, (i) the
          mean between the high and low sales prices at which Shares were sold
          on the New York Stock Exchange, or, if the shares are not listed on
          the New York Stock Exchange, on any other such exchange on which the
          Shares are traded, on such date, or, in the absence of reported sales
          on such date, the mean between the high and low sales prices on the
          immediately preceding date on which sales were reported, or (ii) in
          the absence of such sales prices for the Shares on either of such
          dates, the fair market value as determined in good faith by the
          Committee in its sole discretion.

     8.   Withholding Requirements. Whenever payments hereunder are to be made
          in cash, or Restrictions lapse with respect to Restricted Shares, the
          Company shall have the right to withhold from sums due to the
          Participant (or to require the Participant to remit to the Company) an
          amount sufficient to satisfy any federal, state or local withholding
          tax requirements prior to making such payments or delivering any
          certificate evidencing such shares.

     9.   Change in Control. Notwithstanding anything herein to the contrary,
          upon a Change in Control, the Committee shall determine the amount of
          the 2003 LTIP


                                       9




<PAGE>


          Award in the manner set forth in this Section 9 (the "CIC LTIP
          Award"). The CIC LTIP Award shall equal the maximum potential 2003
          LTIP Award, prorated to reflect the percentage of the Performance
          Period that has elapsed between the beginning of the Performance
          Period and the date of the Change in Control. Upon a Change in
          Control, the CIC LTIP Award shall immediately vest and become payable.
          If the fair market value of the Shares on the date of the Change in
          Control is less than the CIC LTIP Award, the Restrictions on all of
          the Shares will lapse immediately and the difference will be paid in
          cash. If the fair market value of the Shares on the date of the Change
          in Control exceeds the CIC LTIP Award, then Restrictions will lapse
          only as to the number of Shares, the fair market value of which is
          equal to the amount necessary to fund the CIC LTIP Award, and any
          remaining Shares will be forfeited. A "Change in Control" means the
          occurrence of any one of the following events.

          (j)  individuals who, on January 21, 1997, constitute the Board (the
               "Incumbent Directors") cease for any reason to constitute at
               least a majority of the Board, provided that any person becoming
               a director subsequent to January 21, 1997, whose election or
               nomination for election was approved by a vote of at least
               three-fourths (3/4) of the Incumbent Directors then on the Board
               (either by a specific vote or by approval of the proxy statement
               of the Company in which such person is named as a nominee for
               director, without written objection to such nomination) shall be
               an Incumbent Director; provided, however, that no individual
               elected or nominated as a director of the Company initially as a
               result of an actual or threatened election contest with respect
               to directors or as a result of any other actual or threatened
               solicitation of proxies or consents by or on behalf of any person
               other than the Board shall be deemed to be an Incumbent Director;

          (ii) any "Person" (for purposes of this definition only, as defined
               under Section 3(a)(9) of the Securities Exchange Act of 1934, as
               amended (the "Exchange Act") and as used in Section 13(d) or
               Section 14(d) of the Exchange Act) is or becomes a "beneficial
               owner" (as defined in Rule 13d-3 under the Exchange Act),
               directly or indirectly, of securities of the Company representing
               20% or more of the combined voting power of the Company's then
               outstanding securities eligible to vote for the election of the
               Board (the "Company Voting Securities") provided, however, that
               the event described in this paragraph (ii) shall not be deemed to
               be a Change in Control by virtue of any of the following
               acquisitions: (A) by the Company or any entity in which the
               Company directly or indirectly beneficially owns more than 50% of
               the voting securities or interest (a "Subsidiary"), (B) by an
               employee stock ownership or employee benefit plan or trust
               sponsored or maintained by the Company or any Subsidiary, (C) by
               any underwriter temporarily holding securities pursuant to an
               offering of such securities, or (D) pursuant to a Non-Qualifying
               Transaction (as defined in paragraph (iii));


                                       10




<PAGE>


          (iii) the shareholders of the Company approve a merger, consolidation,
               share exchange or similar form of corporate transaction involving
               the Company or any of its Subsidiaries that requires the approval
               of the Company's shareholders, whether for such transaction or
               the issuance of securities in the transaction (a "Business
               Combination"), unless immediately following such Business
               Combination: (A) more than 50% of the total voting power of (x)
               the corporation resulting from such Business Combination (the
               "Surviving Corporation"), or (y) if applicable, the ultimate
               parent corporation that directly or indirectly has beneficial
               ownership of 100% of the voting securities eligible to elect
               directors of the Surviving Corporation (the "Parent
               Corporation"), is represented by Company Voting Securities that
               were outstanding immediately prior to the consummation of such
               Business Combination (or, if applicable, is represented by shares
               into which such Company Voting Securities were converted pursuant
               to such Business Combination), and such voting power among the
               holders thereof is in substantially the same proportion as the
               voting power of such Company Voting Securities among the holders
               thereof immediately prior to the Business Combination, (B) no
               Person (other than any employee benefit plan sponsored or
               maintained by the Surviving Corporation or the Parent
               Corporation), is or becomes the beneficial owner, directly or
               indirectly, of 20% or more of the total voting power of the
               outstanding voting securities eligible to elect directors of the
               Parent Corporation (or, if there is no Parent Corporation, the
               Surviving Corporation) and (C) at least a majority of the members
               of the board of directors of the Parent Corporation (or, if there
               is no Parent Corporation, the Surviving Corporation) were
               Incumbent Directors at the time of the Board's approval of the
               execution of the initial agreement providing for such Business
               Combination (any Business Combination which satisfies all of the
               criteria specified in (A), (B) and (C) above shall be deemed to
               be a "Non-Qualifying Transaction"); or

          (iv) the shareholders of the Company approve a plan of complete
               liquidation or dissolution of the Company or a sale of all or
               substantially all of the Company's assets.

     Computations required by paragraph (iii) shall be made on and as of the
     date of shareholder approval and shall be based on reasonable assumptions
     that will result in the lowest percentage obtainable. Notwithstanding the
     foregoing, a Change in Control of the Company shall not be deemed to have
     occurred solely because any Person acquires beneficial ownership of more
     than twenty percent (20%) of the Company Voting Securities as a result of
     the acquisition of Company Voting Securities by the Company which reduces
     the number of Company Voting Securities outstanding; provided, that if
     after such acquisition by the Company such Person becomes the beneficial
     owner of additional Company Voting Securities that increases the percentage
     of outstanding Company Voting Securities beneficially owned by such Person,
     a Change in Control of the Company shall then occur.


                                       11




<PAGE>


     10.  Tax Elections. The Participant agrees not to make an election in
          accordance with Section 83(b) of the Internal Revenue Code of 1986, as
          amended, to include in his gross income for federal income tax
          purposes the value of the Restricted Shares in the year in which this
          Agreement is made.

     11.  Effect on Employment. Nothing contained in this Agreement shall confer
          upon the Participant the right to continue in the employment of the
          Company (including its subsidiaries) or affect any right that the
          Company (including its subsidiaries) may have to terminate the
          employment of the Participant.

     12.  Amendment. This Agreement may not be amended except with the consent
          of the Committee and by a written instrument duly executed by the
          Participant and the Company.

     13.  Binding Effect. This Agreement shall be binding upon and shall inure
          to the benefit of the parties hereto and their heirs, personal
          representatives, successors and assigns.

     14.  Choice of Law. This Agreement shall be governed by the law of the
          State of Tennessee without reference to the conflicts of laws
          provisions thereof.

          IN WITNESS WHEREOF, the each of the Company and the Participant has
executed and delivered this Agreement as of the ___ of August, 2004, but
effective the day and year first above written.

                                        FIRST HORIZON NATIONAL CORPORATION


                                        By:
                                            ------------------------------------
                                        Its:
                                             -----------------------------------


ATTEST


- -------------------------------------

                                        PARTICIPANT

                                        ----------------------------------------


                                       12




<PAGE>


                                    Exhibit A

o    Funding of the Incentive Pool. The amount by which the Company will fund
     the incentive pool from which all of the Participants' 2003 LTIP Awards
     will be paid will be determined based on the higher of either one of the
     following two criteria established by the Compensation Committee: (1) the
     Company's Price/Earnings Ratio ("P/E Ratio") relative to the Peer Group (as
     defined below) as of the Measurement Date or (2) the Compound Annual Growth
     Rate ("CAGR") in the Company's stock price.

     o    The Company's relative P/E Ratio measurement criteria is as follows:

          o    If the Company's P/E Ratio equals the ____th percentile of the
               P/E Ratio of the Peer Group, an incentive pool will be funded
               equal to 20% of the maximum aggregate potential 2003 LTIP Award
               of all the Participants. The "Peer Group" shall be the "Top 50
               Banks" as identified by American Banker at the beginning of the
               Performance Period.

          o    If the Company's P/E Ratio equals the ____th percentile of the
               P/E Ratio of the Peer Group, an incentive pool will be funded
               equal to 100% of the maximum aggregate potential 2003 LTIP Award
               of all the Participants.

          o    Straight line interpolation will be used to fund the incentive
               pool when performance is between the ____th and ____th percentile
               of the Peer Group.

          o    Regardless of Company's relative performance, no incentives will
               be funded or paid unless the Company's P/E Ratio increases during
               the Performance Period. The P/E ratio at the beginning of the
               performance period is 12.3.

          o    The initial Performance Period covers 3 years (2003 - 2005), and
               the Measurement Date for the initial Performance Period will be
               January 31, 2006.

          o    The numerator of the P/E Ratio will be based on the
               60-trading-day average closing price for the period ending
               January 31, 2006 as reported by The Wall Street Journal, unless
               the Committee selects another period (e.g., due to market
               volatility or rumors of potential transactions).

          o    The denominator of the P/E Ratio will be the Company's actual
               earnings for the year ended 12/31/05, unless the Committee
               approves a different period.

          o    If, at the end of the Performance Period, the Committee
               determines that the Company's P/E Ratio is distorted (positively
               or negatively) by market volatility (e.g., due to speculation
               about potential business combinations), then the Committee may
               adjust the incentive pool. Alternatively, the Committee may
               direct the Company to calculate its relative P/E Ratio over a
               longer or shorter period of time (i.e., 90 days rather than 60
               days) or otherwise determine a normalized P/E Ratio for
               comparison to the Peer Group.


                                       13




<PAGE>


     o    The stock price CAGR measurement criteria is as follows:

          o    Target based on 2003-2005 strategic plan as presented to the
               Board in October, 2002.

          o    100% payout earned only if stock price CAGR represents
               significant return to shareholders as indicated in the following
               grid:

              <TABLE>
              <CAPTION>
                                  CAGR   =>   Payout %
                                  ----        --------
                                  <S>         <C>
                                   ____%         100%
                                   ____           75
                                   ____           50
                                   ____           25
                                   ____          -0-
              </TABLE>

     o    The amount of the incentive pool funded may be reduced by the
          Committee in order to more accurately reflect the Company's total
          performance. In determining the amount, if any, by which the incentive
          pool will be reduced, the Committee may consider measures such as the
          following:

<TABLE>
<CAPTION>
     --------------------------------------
     Factor            Guideline
     --------------------------------------
<S>                    <C>
     Rating Agencies   [guideline redacted]
     --------------------------------------
     Regulatory        [guideline redacted]
     --------------------------------------
     Capitalization    [guideline redacted]
     --------------------------------------
     Governance        [guideline redacted]
     --------------------------------------
</TABLE>

     o    Failure to meet the guideline for any one of the above factors may in
          the Committee's discretion result in a 20% reduction, up to a total
          reduction of 80%, of the incentive pool.

o    Determination of Individual Participant's Earned Award. The objective of
     the LTIP is to deliver a total annual award up to 75% of the maximum bonus
     potential for each individual Participant under his/her respective annual
     bonus plan for the Performance Period (MIP or FirstPower). The incentive
     pool available will be determined based on the applicable performance
     criteria outlined above. Each Participant's maximum Earned Award will be
     calculated as follows:

[Standard version formula]

     o    Annual LTIP Value = Eligible Base Salary times Annual Bonus Plan
          Maximum Potential times 0.75

[Formula applicable to executives whose bonuses are based on a measure of
business unit earnings:]

     o    Annual LTIP Value = Eligible Base Salary times 0.75


                                       14




<PAGE>


     The Annual LTIP Value will be determined for each calendar year during the
     Performance Period. At the end of the Performance Period, the maximum
     Earned Award will be determined as follows:

     o    Maximum Earned Award = (2003 Annual LTIP Value + 2004 Annual LTIP
          Value + 2005 Annual LTIP Value) times (percentage of incentive pool
          funded as described above).

     o    Notwithstanding anything to the contrary herein, the Committee may in
          its discretion choose to award a Participant less than his/her maximum
          Earned Award as calculated above, taking into account such factors as
          it may deem relevant, including but not limited to the Participant's
          achievement of his/her bonus objectives under his/her applicable
          annual bonus plan.


                                       15


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>7
<FILENAME>ex10-4b.txt
<DESCRIPTION>EXHIBIT 10.4(B)
<TEXT>

<PAGE>


                                                                 EXHIBIT 10.4(b)

                                    NOTICE OF
             2004 LONG-TERM INCENTIVE PLAN AWARD ("2004 LTIP AWARD")
                       UNDER 2003 EQUITY COMPENSATION PLAN

1.0  OBJECTIVE:

     The purpose of the Long-Term Incentive Plan Award ("LTIP") pursuant to
     Section 8 of the First Horizon National Corporation's 2003 Equity
     Compensation Plan (the "Plan") is to provide motivation for key executives
     to achieve the Company's strategic objectives and ensure incentive rewards
     and performance are linked to shareholder value.

2.0  LTIP PERFORMANCE PERIOD:

     The LTIP performance period will be the Company's fiscal years beginning
     January 1, 2004 and ending December 31, 2006.

3.0  ELIGIBILITY:

          o    Eligibility for executive officers who are subject to Section 16
               (as defined in the Plan) or who are Covered Officers (as defined
               in the Plan) is approved annually by the Compensation Committee
               ("Committee").

          o    Eligibility for all other executives is approved annually by the
               CEO.

4.0  FUNDING OF THE INCENTIVE POOL:

     o    As soon as possible following the end of the Performance Period, the
          Committee shall determine the 2004 LTIP Award earned by each
          Participant in the manner described in Sections 4.0 and 5.0 of this
          Notice (the "Earned Award").

     o    The amount by which the Company will fund the incentive pool from
          which all of the Participants' 2004 LTIP Awards will be paid will be
          determined by the Committee based on the following measurement
          criteria: (1) the Company's stock price compound annual growth rate
          (the "Stock Price CAGR"), (2) the Company's stock price compound
          annual growth rate relative to the "Top 50 Banks" as identified by
          American Banker at the beginning of the Performance Period (the "Peer
          Group") (the "Relative Stock Price CAGR") and (3) the Company's
          cumulative diluted earnings per share ("EPS") as reported in the
          Company's year-end audited financial statements, except that the
          calculation of EPS for purposes of determining achievement of the
          performance goal will exclude the negative effect of any nonrecurring
          items, extraordinary items, discontinued operations, or cumulative
          effects of accounting changes ("Cumulative Modified EPS").


                                        1




<PAGE>


     o    The threshold criterion to be used to determine funding of the
          incentive pool shall be the Company's Cumulative Modified EPS.

          o    Except as provided below, if the Company's Cumulative Modified
               EPS is equal to or greater than an amount established by the
               Committee at the beginning of the Performance Period, an
               incentive pool will be funded equal to 100% of the maximum
               aggregate potential 2004 LTIP Awards of all the Participants.

     o    Notwithstanding the Company's achievement of the Cumulative Modified
          EPS criterion, the Committee shall have complete discretion to reduce
          the incentive pool funding in accordance with the higher of the Stock
          Price CAGR measurement criterion or the Relative Stock Price CAGR
          measurement criterion as described below.

     o    The Stock Price CAGR measurement criterion is as follows:

               o    Target based on 2003-2005 strategic plan as presented to the
                    Board in October, 2002.

               o    Payouts earned if stock price CAGR represents significant
                    return to shareholders as indicated in the following grid:

                    <TABLE>
                    <CAPTION>
                                     CAGR   =>   Payout%
                                     ----        -------
                                     <S>         <C>
                                     ___%          100%
                                     ___            75
                                     ___            50
                                     ___            25
                                     ___           -0-
                    </TABLE>

               Beginning stock price at 12/31/2003 is $44.15.

     o    The Relative Stock Price CAGR measurement criterion is as follows:

               o    If the Company's Relative Stock Price CAGR is in the Top ___
                    of the Peer Group** and positive, 100% payout is achieved.

                    ** Performance of individual companies in the Peer Group
                    will be adjusted for down years.

               Payout/Accrual Grid:

<TABLE>
<CAPTION>
               Peer Group Rank   =>   Payout %
               ---------------        --------
<S>                                     <C>
               Top ___                  100%
               Top ___                   75
               ___ Percentile            50
               > ___ <___                25
               < ______                 -0-
</TABLE>


                                        2




<PAGE>


     o    The amount of the incentive pool funded may be further reduced by the
          Committee in its discretion in order to more accurately reflect the
          Company's total performance. In determining the amount, if any, by
          which the incentive pool will be reduced, the Committee may consider
          measures such as the following:

<TABLE>
<CAPTION>
     --------------------------------------
     Factor            Guideline
     --------------------------------------
<S>                    <C>
     Rating Agencies   [guideline redacted]
     --------------------------------------
     Regulatory        [guideline redacted]
     --------------------------------------
     Capitalization    [guideline redacted]
     --------------------------------------
     Governance        [guideline redacted]
     --------------------------------------
</TABLE>

          Failure to meet the guideline for any one of the above factors may in
          the Committee's discretion result in a 20% reduction, up to a total
          reduction of 80%, of the LTIP incentive pool.

5.0  DETERMINATION OF INDIVIDUAL PARTICIPANT'S MAXIMUM EARNED AWARD AND PAYMENT
     OF AWARD:

     o    The objective of the LTIP is to deliver a total annual award up to 75%
          of the maximum bonus potential for each individual Participant under
          his/her respective annual bonus plan for the Performance Period (MIP
          or FirstPower). The incentive pool available will be determined based
          on the applicable performance criteria outlined in Section 4.0 above.
          Each Participant's maximum Earned Award will be calculated as follows:

     [Standard version formula:]

               Annual LTIP Value = Eligible Base Salary times Annual Bonus Plan
               Target times 0.75

     [Formula applicable to executives whose bonuses are based on a measure of
     business unit earnings:]

               Annual LTIP Value = Eligible Base Salary times 0.75

          The Annual LTIP Value will be determined for each calendar year during
          the Performance Period. At the end of the Performance Period, the
          maximum Earned Award will be determined as follows:

               LTIP Incentive Award = (2004 Annual LTIP Value + 2005 Annual LTIP
               Value + 2006 Annual LTIP Value) times (percentage of incentive
               pool funded as described in Section 4.0 above)

     o    Notwithstanding anything to the contrary herein, the Committee may in
          its discretion choose to award a Participant less than his/her maximum
          Earned Award as calculated above, taking into account such factors as
          it may deem relevant, including but not limited to the Participant's
          achievement of his/her bonus objectives under his/her applicable
          annual bonus plan.


                                        3




<PAGE>


o    Notwithstanding anything to the contrary herein, the Committee may delay
     the pay-ment of any Earned Award for a period of up to a year after the
     Measurement Date.

6.0  TERMINATION OF EMPLOYMENT AND FORFEITURE OF AWARD:

     Except as may otherwise be determined by the Committee, in the event that
     the Participant's employment with the Company (including its subsidiaries)
     terminates for any reason prior to the end of the Performance Period, the
     2004 LTIP Award shall be forfeited, and neither the Participant, nor any
     successor, heir, assign or personal representative of the Participant,
     shall have any further right to or interest in the 2004 LTIP Award.
     Notwithstanding anything herein to the contrary, if a Change in Control (as
     defined in Section 7) occurs and if, prior to the date on which the Change
     in Control occurs, the Participant's employment with the Company is
     terminated or the Participant is reassigned to a position which in the
     opinion of the Committee reduces the Participant's ability to make an
     impact upon the profitability of the Company through his/her decisions,
     actions and counsel and if it is reasonably demonstrated by the Participant
     that such termination of employment or reassignment of position (i) was at
     the request of a third party who has taken steps reasonably calculated to
     effect a Change in Control or (ii) otherwise arose in connection with or in
     anticipation of a Change in Control, then for all purposes of this Notice
     the 2004 LTIP Award shall not be forfeited by the Participant to the
     Company upon such termination or reassignment, and the amount of the 2004
     LTIP Award shall be determined by the Committee as described in Section 7.0
     below and shall vest and be payable immediately upon the Change in Control.

7.0  CHANGE IN CONTROL:

     Notwithstanding anything herein to the contrary, upon a Change in Control,
     the Committee shall determine the amount of the 2004 LTIP Award in the
     manner set forth in this Section 7.0 (the "CIC LTIP Award"). The CIC LTIP
     Award shall equal the maximum potential 2004 LTIP Award, prorated to
     reflect the percentage of the Performance Period that has elapsed between
     the beginning of the Performance Period and the date of the Change in
     Control. The CIC LTIP Award shall vest and be immediately payable upon a
     Change in Control. A "Change in Control" means the occurrence of any one of
     the following events.

     (i)  individuals who, on January 21, 1997, constitute the Board (the
          "Incumbent Directors") cease for any reason to constitute at least a
          majority of the Board, provided that any person becoming a director
          subsequent to January 21, 1997, whose election or nomination for
          election was approved by a vote of at least three-fourths (3/4) of the
          Incumbent Directors then on the Board (either by a specific vote or by
          approval of the proxy statement of the Company in which such person is
          named as a nominee for director, without written objection to such
          nomination) shall be an Incumbent Director; provided, however, that no


                                        4




<PAGE>


          individual elected or nominated as a director of the Company initially
          as a result of an actual or threatened election contest with respect
          to directors or as a result of any other actual or threatened
          solicitation of proxies or consents by or on behalf of any person
          other than the Board shall be deemed to be an Incumbent Director;

     (ii) any "Person" (for purposes of this definition only, as defined under
          Section 3(a)(9) of the Securities Exchange Act of 1934, as amended
          (the "Exchange Act") and as used in Section 13(d) or Section 14(d) of
          the Exchange Act) is or becomes a "beneficial owner" (as defined in
          Rule 13d-3 under the Exchange Act), directly or indirectly, of
          securities of the Company representing 20% or more of the combined
          voting power of the Company's then outstanding securities eligible to
          vote for the election of the Board (the "Company Voting Securities")
          provided, however, that the event described in this paragraph (ii)
          shall not be deemed to be a Change in Control by virtue of any of the
          following acquisitions: (A) by the Company or any entity in which the
          Company directly or indirectly beneficially owns more than 50% of the
          voting securities or interest (a "Subsidiary"), (B) by an employee
          stock ownership or employee benefit plan or trust sponsored or
          maintained by the Company or any Subsidiary, (C) by any underwriter
          temporarily holding securities pursuant to an offering of such
          securities, or (D) pursuant to a Non-Qualifying Transaction (as
          defined in paragraph (iii);

     (iii) the shareholders of the Company approve a merger, consolidation,
          share exchange or similar form of corporate transaction involving the
          Company or any of its Subsidiaries that requires the approval of the
          Company's shareholders, whether for such transaction or the issuance
          of securities in the transaction (a "Business Combination"), unless
          immediately following such Business Combination: (A) more than 50% of
          the total voting power of (x) the corporation resulting from such
          Business Combination (the "Surviving Corporation"), or (y) if
          applicable, the ultimate parent corporation that directly or
          indirectly has beneficial ownership of 100% of the voting securities
          eligible to elect directors of the Surviving Corporation (the "Parent
          Corporation"), is represented by Company Voting Securities that were
          outstanding immediately prior to the consummation of such Business
          Combination (or, if applicable, is represented by shares into which
          such Company Voting Securities were converted pursuant to such
          Business Combination), and such voting power among the holders thereof
          is in substantially the same proportion as the voting power of such
          Company Voting Securities among the holders thereof immediately prior
          to the Business Combination, (B) no Person (other than any employee
          benefit plan sponsored or maintained by the Surviving Corporation or
          the Parent Corporation), is or becomes the beneficial owner, directly
          or indirectly, of 20% or more of the total voting power of the
          outstanding voting securities eligible to elect directors of the
          Parent Corporation (or, if there is no Parent Corporation, the
          Surviving Corporation) and (C) at least a majority of the members of
          the board of directors of the Parent Corporation (or, if there is


                                        5




<PAGE>


          no Parent Corporation, the Surviving Corporation) were Incumbent
          Directors at the time of the Board's approval of the execution of the
          initial agreement providing for such Business Combination (any
          Business Combination which satisfies all of the criteria specified in
          (A), (B) and (C) above shall be deemed to be a "Non-Qualifying
          Transaction"); or

     (iv) the shareholders of the Company approve a plan of complete liquidation
          or dissolution of the Company or a sale of all or substantially all of
          the Company's assets.

     Computations required by paragraph (iii) shall be made on and as of the
     date of shareholder approval and shall be based on reasonable assumptions
     that will result in the lowest percentage obtainable. Notwithstanding the
     foregoing, a Change in Control of the Company shall not be deemed to have
     occurred solely because any Person acquires beneficial ownership of more
     than twenty percent (20%) of the Company Voting Securities as a result of
     the acquisition of Company Voting Securities by the Company which reduces
     the number of Company Voting Securities outstanding; provided, that if
     after such acquisition by the Company such Person becomes the beneficial
     owner of additional Company Voting Securities that increases the percentage
     of outstanding Company Voting Securities beneficially owned by such Person,
     a Change in Control of the Company shall then occur.

8.0  EFFECT ON EMPLOYMENT:

     Nothing contained in the LTIP shall confer upon the Participant the right
     to continue in the employment of the Company (including its subsidiaries)
     or affect any right that the Company (including its subsidiaries) may have
     to terminate the employment of the Participant.

9.0  AMENDMENT:

     The 2004 LTIP Awards may not be amended except with the consent of the
     Committee.

10.0 WITHHOLDING:

     Whenever payments hereunder are to be made in cash, the Company shall have
     the right to withhold from sums due to the Participant (or to require the
     Participant to remit to the Company) an amount sufficient to satisfy any
     federal, state or local withholding tax requirements prior to making such
     payments.

- --------------------------------------------------------------------------------

The following reflects action taken affecting this award, but is not part of the
award document:

On February 22, 2005, the Compensation Committee of the Board of Directors,
acting under authority delegated to it under the 2003 Equity Compensation Plan,
combined two years of the


                                        6




<PAGE>


2004 LTIP awards with the 2005 LTIP awards. In connection with that action, the
Committee limited the amount payable under the 2004 LTIP award to a single-year
amount and granted 2005 LTIP awards with both a two-year performance period
(2005-2006) and a three-year performance period (2005-2007).


                                        7


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>8
<FILENAME>ex10-4c.txt
<DESCRIPTION>EXHIBIT 10.4(C)
<TEXT>

<PAGE>


                                                                 EXHIBIT 10.4(c)

                                    NOTICE OF
             2005 LONG-TERM INCENTIVE PLAN AWARD ("2005 LTIP AWARD")
                       UNDER 2003 EQUITY COMPENSATION PLAN

1.0  OBJECTIVE:

     The purpose of the Long-Term Incentive Plan Award ("LTIP") pursuant to
     Section 8 of the First Horizon National Corporation's 2003 Equity
     Compensation Plan (the "Plan") is to provide motivation for key executives
     to achieve the Company's strategic objectives and ensure incentive rewards
     and performance are linked to shareholder value.

2.0  LTIP PERFORMANCE PERIOD:

     The LTIP performance period for 40% of the award will be the Company's
     fiscal years beginning January 1, 2005 and ending December 31, 2006 (the
     2005-06 Performance Period) and the LTIP performance period for 60% of the
     award will be the Company's fiscal years beginning January 1, 2005 and
     ending December 31, 2007 (the 2005-07 Performance Period).

3.0  ELIGIBILITY:

          o    Eligibility for executive officers who are subject to Section 16
               (as defined in the Plan) or who are Covered Officers (as defined
               in the Plan) is approved annually by the Compensation Committee
               ("Committee").

          o    Eligibility for all other executives is approved annually by the
               CEO.

4.0  AWARD:

          2005 LTIP Awards will be granted effective March 4, 2005 in
          Performance Share Units using the following formula: The number of
          units awarded to each Participant will be equal to the Participant's
          base salary effective March 4, 2005 times the Participant's annual
          bonus target percentage* times 1.5 (for the 2005-07 Performance
          Period) and times 2.25 (for the 2005-07 Performance Period), with the
          resulting dollar amount for each Performance Period divided by the
          Fair Market Value of one share of the Company's common stock on March
          4, 2005 to determine the number of Units. Awards will be rounded to
          the nearest whole Unit. Units will not earn dividends during the
          Performance Period.

               *100% will be used for the annual bonus target percentage if the
               Participant's annual bonus is determined using a formula based on
               a percentage of the Officer's business unit pre-tax income.


                                       1




<PAGE>


5.0  DETERMINATION OF INDIVIDUAL PARTICIPANT'S EARNED AWARD AND PAYMENT OF
     AWARD:

     The number of Units which are earned (vest) following the end of each
     Performance Period will be determined by the Committee based on the
     following measurement criteria:

     100% of the Units will vest if average annual EPS equals or exceeds $___
     per share.

     o    The Compensation Committee may use negative discretion to reduce the
          award based on EPS growth during the performance period. A basis for
          reducing the award may be competitive EPS growth results for the
          Performance Period relative to the "Top 30 Banks" as identified by
          American Banker at the beginning of the Performance Period (the "Peer
          Group") as follows (results in between the percentiles shown will be
          interpolated):

          <TABLE>
          <CAPTION>
                  EPS Growth Percentile      Percentage of Units Vesting
                  ---------------------      ---------------------------
                  <S>                          <C>
                            ____                   100%
                            ____                    67%
                            ____                    33%
                      Below ____                  Committee Discretion
          </TABLE>

          The following adjustments may be made to evaluate performance subject
          to Compensation Committee negative discretion to determine final
          awards:

          o    One-time acquisition costs will be excluded.

          o    Material nonrecurring non-operating items (positive or negative)
               as required under accounting rules or by our auditors to be
               listed and discussed in company financial statements will be
               excluded.

     o    The number of Units earned (vested) may be reduced by the Committee in
          its discretion in order to more accurately reflect the Company's total
          performance. In determining the amount, if any, by which the number of
          Units will be reduced, the Committee may consider measures such as the
          following:

<TABLE>
<CAPTION>
     --------------------------------------
     Factor            Guideline
<S>                    <C>
     --------------------------------------
     Rating Agencies   [guideline redacted]
     --------------------------------------
     Regulatory        [guideline redacted]
     --------------------------------------
     Capitalization    [guideline redacted]
     --------------------------------------
     Governance        [guideline redacted]
     --------------------------------------
</TABLE>

     o    Notwithstanding the Company's achievement of the above criteria, the
          Committee shall have complete discretion to further reduce the number
          of Units earned (vested), including payment of no award.

     o    Vested Units will be paid in shares (one share for each vested Unit).


                                       2




<PAGE>


6.0  FAIR MARKET VALUE OF SHARES

     The Fair Market Value of each share of common stock shall mean, as of any
     date, (i) the mean between the high and low sales prices at which shares
     were sold on the New York Stock Exchange, or, if the shares are not listed
     on the New York Stock Exchange, on any other such exchange on which the
     shares are traded, on such date, or in the absence of purported sales on
     such date, the mean between the high and low sales prices on the
     immediately preceding date on which sales were reported, or (ii) in the
     absence of such sales prices for the shares on either of such dates, the
     fair market value as determined in good faith by the Committee in its sole
     discretion.

7.0  TERMINATION OF EMPLOYMENT AND FORFEITURE OF AWARD:

     Except as may otherwise be determined by the Committee, in the event that
     the Participant's employment with the Company (including its subsidiaries)
     terminates for any reason prior to the end of the Performance Period, the
     2005 LTIP Award shall be forfeited, and neither the Participant, nor any
     successor, heir, assign or personal representative of the Participant,
     shall have any further right to or interest in the 2005 LTIP Award.
     Notwithstanding anything herein to the contrary, if a Change in Control (as
     defined in Section 7) occurs and if, prior to the date on which the Change
     in Control occurs, the Participant's employment with the Company is
     terminated or the Participant is reassigned to a position which in the
     opinion of the Committee reduces the Participant's ability to make an
     impact upon the profitability of the Company through his/her decisions,
     actions and counsel and if it is reasonably demonstrated by the Participant
     that such termination of employment or reassignment of position (i) was at
     the request of a third party who has taken steps reasonably calculated to
     effect a Change in Control or (ii) otherwise arose in connection with or in
     anticipation of a Change in Control, then for all purposes of this Notice
     the 2005 LTIP Award shall not be forfeited by the Participant to the
     Company upon such termination or reassignment, and the amount of the 2005
     LTIP Award shall be determined by the Committee as described in Section 7.0
     below and shall vest and be payable immediately upon the Change in Control.

8.0  CHANGE IN CONTROL:

     Notwithstanding anything herein to the contrary, upon a Change in Control,
     the Committee shall determine the amount of the 2005 LTIP Award in the
     manner set forth in this Section 7.0 (the "CIC LTIP Award"). The CIC LTIP
     Award shall equal the maximum potential 2005 LTIP Award, prorated to
     reflect the percentage of the Performance Period that has elapsed between
     the beginning of the Performance Period and the date of the Change in
     Control. The CIC LTIP Award shall vest and be immediately payable upon a
     Change in Control. A "Change in Control" means the occurrence of any one of
     the following events.


                                       3




<PAGE>


     (i)  individuals who, on January 21, 1997, constitute the Board (the
          "Incumbent Directors") cease for any reason to constitute at least a
          majority of the Board, provided that any person becoming a director
          subsequent to January 21, 1997, whose election or nomination for
          election was approved by a vote of at least three-fourths (3/4) of the
          Incumbent Directors then on the Board (either by a specific vote or by
          approval of the proxy statement of the Company in which such person is
          named as a nominee for director, without written objection to such
          nomination) shall be an Incumbent Director; provided, however, that no
          individual elected or nominated as a director of the Company initially
          as a result of an actual or threatened election contest with respect
          to directors or as a result of any other actual or threatened
          solicitation of proxies or consents by or on behalf of any person
          other than the Board shall be deemed to be an Incumbent Director;

     (ii) any "Person" (for purposes of this definition only, as defined under
          Section 3(a)(9) of the Securities Exchange Act of 1934, as amended
          (the "Exchange Act") and as used in Section 13(d) or Section 14(d) of
          the Exchange Act) is or becomes a "beneficial owner" (as defined in
          Rule 13d-3 under the Exchange Act), directly or indirectly, of
          securities of the Company representing 20% or more of the combined
          voting power of the Company's then outstanding securities eligible to
          vote for the election of the Board (the "Company Voting Securities")
          provided, however, that the event described in this paragraph (ii)
          shall not be deemed to be a Change in Control by virtue of any of the
          following acquisitions: (A) by the Company or any entity in which the
          Company directly or indirectly beneficially owns more than 50% of the
          voting securities or interest (a "Subsidiary"), (B) by an employee
          stock ownership or employee benefit plan or trust sponsored or
          maintained by the Company or any Subsidiary, (C) by any underwriter
          temporarily holding securities pursuant to an offering of such
          securities, or (D) pursuant to a Non-Qualifying Transaction (as
          defined in paragraph (iii);

     (iii) the shareholders of the Company approve a merger, consolidation,
          share exchange or similar form of corporate transaction involving the
          Company or any of its Subsidiaries that requires the approval of the
          Company's shareholders, whether for such transaction or the issuance
          of securities in the transaction (a "Business Combination"), unless
          immediately following such Business Combination: (A) more than 50% of
          the total voting power of (x) the corporation resulting from such
          Business Combination (the "Surviving Corporation"), or (y) if
          applicable, the ultimate parent corporation that directly or
          indirectly has beneficial ownership of 100% of the voting securities
          eligible to elect directors of the Surviving Corporation (the "Parent
          Corporation"), is represented by Company Voting Securities that were
          outstanding immediately prior to the consummation of such Business
          Combination (or, if applicable, is represented by shares into which
          such Company Voting Securities were converted pursuant to such
          Business Combination), and such voting power


                                       4




<PAGE>


          among the holders thereof is in substantially the same proportion as
          the voting power of such Company Voting Securities among the holders
          thereof immediately prior to the Business Combination, (B) no Person
          (other than any employee benefit plan sponsored or maintained by the
          Surviving Corporation or the Parent Corporation), is or becomes the
          beneficial owner, directly or indirectly, of 20% or more of the total
          voting power of the outstanding voting securities eligible to elect
          directors of the Parent Corporation (or, if there is no Parent
          Corporation, the Surviving Corporation) and (C) at least a majority of
          the members of the board of directors of the Parent Corporation (or,
          if there is no Parent Corporation, the Surviving Corporation) were
          Incumbent Directors at the time of the Board's approval of the
          execution of the initial agreement providing for such Business
          Combination (any Business Combination which satisfies all of the
          criteria specified in (A), (B) and (C) above shall be deemed to be a
          "Non-Qualifying Transaction"); or

     (iv) the shareholders of the Company approve a plan of complete liquidation
          or dissolution of the Company or a sale of all or substantially all of
          the Company's assets.

     Computations required by paragraph (iii) shall be made on and as of the
     date of shareholder approval and shall be based on reasonable assumptions
     that will result in the lowest percentage obtainable. Notwithstanding the
     foregoing, a Change in Control of the Company shall not be deemed to have
     occurred solely because any Person acquires beneficial ownership of more
     than twenty percent (20%) of the Company Voting Securities as a result of
     the acquisition of Company Voting Securities by the Company which reduces
     the number of Company Voting Securities outstanding; provided, that if
     after such acquisition by the Company such Person becomes the beneficial
     owner of additional Company Voting Securities that increases the percentage
     of outstanding Company Voting Securities beneficially owned by such Person,
     a Change in Control of the Company shall then occur.

9.0  EFFECT ON EMPLOYMENT:

     Nothing contained in the LTIP shall confer upon the Participant the right
     to continue in the employment of the Company (including its subsidiaries)
     or affect any right that the Company (including its subsidiaries) may have
     to terminate the employment of the Participant.

10.0 AMENDMENT:

     The 2005 LTIP Awards may not be amended except with the consent of the
     Committee.


                                       5




<PAGE>


11.0 WITHHOLDING:

     The Company shall have the right to withhold shares from vested Units due
     to the Participant (or to require the Participant to remit cash to the
     Company) in an amount sufficient to satisfy any federal, state or local
     withholding tax requirements prior to distribution of shares to the
     Participant.


                                       6


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>9
<FILENAME>ex10-5b.txt
<DESCRIPTION>EXHIBIT 10.5(B)
<TEXT>

<PAGE>


                                                                 EXHIBIT 10.5(b)

                                                      RESTRICTED STOCK AGREEMENT

Date: April 17, 2003

Participant: J. Kenneth Glass

Number of Shares: 50,000

     Restricted Stock Agreement made as of the 15th day of April, 2003, by and
between J. Kenneth Glass (the "Participant") and First Tennessee National
Corporation (the "Company"), acting with the prior approval of the Board of
Directors upon the recommendation of its Human Resources Committee (the
"Committee").

     In consideration of the covenants hereinafter set forth, the Company and
the Participant agree as follows:

     1. Award. Pursuant to the terms of the First Tennessee National Corporation
2003 Equity Compensation Plan (the "Plan"), the Company hereby grants to the
Participant 50,000 shares (the "Shares") of common stock of the company, par
value $0.625 per share (the "Common Stock"), subject to the Restrictions and
other conditions hereinafter set forth. So long as any Shares are subject to the
Restrictions set forth in Section 3 hereof, such Shares shall be deemed to be,
and shall be referred to herein as, Restricted Shares.

     2. Certificates. Each certificate evidencing Restricted Shares shall be
deposited with the Treasurer of the Company, accompanied by a stock power in
blank executed by the Participant, or shall be held in book-entry form at the
Company's transfer agent, and shall bear the following legend:

     "This certificate and the shares of stock represented hereby are subject to
the terms and conditions (including the risk of forfeiture and restrictions on
transfer) contained in the First Tennessee National Corporation 2003 Equity
Compensation Plan and a Restricted Stock Agreement entered into between the
registered owner and First Tennessee National Corporation. Release from such
terms and conditions shall occur only in accordance with the provisions of such
Plan and Agreement, a copy of each of which is filed with the Secretary of First
Tennessee National Corporation."

     3. Restrictions. During the applicable period of restriction determined in
accordance with Section 5 of this Agreement, Restricted Shares, and the right to
vote such Shares and to receive dividends thereon, may not be sold, assigned,
transferred, exchanged, pledged, hypothecated or otherwise encumbered, and shall
be subject to the risk of forfeiture contained in Section 4 of this Agreement
(such limitations on transferability and risk of forfeiture being collectively
called the "Restrictions"), but the Participant shall have all other rights of a
stockholder, including, but not limited to, the right to vote and receive
dividends on Restricted




<PAGE>


Shares.

     4. Forfeiture of Restricted Shares. In the event that the Participant (a)
voluntarily terminates his employment with the Company (including its
subsidiaries), (b) is discharged from employment with the Company (including its
subsidiaries) as a result of his failure (not caused by death or disability) to
perform the duties of his position faithfully and to the best of his ability or
(c) is reassigned to a position which, in the opinion of the Committee, reduces
the Participant's opportunity to make an impact upon the profitability of the
Company through his/her decisions, actions and counsel (the events described in
the foregoing clauses (a), (b), and (c) being called herein "Events of
Forfeiture"), all Shares which at the time are Restricted Shares shall be
forfeited by the Participant to the Company without payment of any consideration
by the Company, and neither the Participant, nor any successor, heir, assign or
personal representative of the Participant, shall have any further right to or
interest in such Restricted Shares or the certificate or certificates evidencing
them. Notwithstanding anything herein to the contrary, if a Change in Control
(as defined in the Plan) occurs and if, prior to the date on which the Change in
Control occurs, the Participant's employment with the Company is terminated or
the Participant is reassigned to a position within the meaning of Section 4(c)
and if it is reasonably demonstrated by the Participant that such termination of
employment or reassignment of position (I) was at the request of a third party
who has taken steps reasonably calculated to effect a Change in Control or (ii)
otherwise arose in connection with or in anticipation of a Change in Control,
then for all purposes of this Agreement such termination or reassignment shall
not be deemed an Event of Forfeiture, no Shares which at the time are Restricted
Shares shall be forfeited by the Participant to the Company upon such
termination or reassignment, and all Restrictions with respect to such Shares
shall lapse upon the Change in Control.

     5. Lapse of Restrictions.

     (a) Subject to clause (b) of this Section 5, the Restrictions shall lapse
with respect to Restricted Shares in accordance with the following schedule:

                         <TABLE>
                         <CAPTION>
                         --------------------------------
                         Date            Number of Shares
                         --------------------------------
                         <S>                  <C>
                         July 17, 2007        25,000
                         --------------------------------
                         July 21, 2009        25,000
                         --------------------------------
                         </TABLE>

     (b) If the Participant's employment with the Company ends as a result of
any event other than an Event of Forfeiture, all Restrictions shall forthwith
lapse as to all Restricted Shares.

     (c) Notwithstanding anything herein to the contrary, all Restrictions with
respect to the Restricted Shares imposed by the Plan or this Agreement shall
lapse immediately upon a Change in Control (as defined in the Plan).

     Upon lapse of the Restrictions in accordance with this Section 5, new
certificates




<PAGE>


evidencing the Shares with respect to which the Restrictions have lapsed without
the foregoing restrictive legend shall be issued to the Participant or his legal
representative against cancellation of the legended certificates, or, if
applicable, the Company's transfer agent shall be directed to remove the legend
from Shares held in book-entry form. Each such new certificate, and any Shares
held in book-entry form, shall, if applicable, bear a legend reflecting any
restrictions upon the transferability of such Shares imposed by law, such as the
Securities Act of 1933.

     6. Withholding Requirements. Whenever payments hereunder are to be made in
cash, or Restrictions lapse with respect to Restricted Shares, the Company shall
have the right to withhold from sums due to the Participant (or to require the
Participant to remit to the Company) an amount sufficient to satisfy any
federal, state or local withholding tax requirements prior to making such
payments or delivering any certificate evidencing such Shares.

     7. Tax Elections. The Participant agrees not to make an election in
accordance with Section 83(b) of the Internal Revenue Code of 1986, as amended,
to include in his gross income for federal income tax purposes the value of the
Restricted Shares in the year in which this Agreement is made.

     8. Effect on Employment. Nothing contained in this Agreement shall confer
upon the Participant the right to continue in the employment of the Company or
affect any right which the Company may have to terminate the employment of the
Participant.

     9. Amendment. This agreement may not be amended except with the consent of
the Committee and by a written instrument duly executed by the Participant and
the Company.

     10. Binding Effect. This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their heirs, personal representatives,
successors and assigns.

     IN WITNESS WHEREOF, each of the Company and the Participant has executed
and delivered this Agreement as of the day and year first above written.

ATTEST                          FIRST TENNESSEE NATIONAL CORPORATION


By:                             By:
    -------------------------       --------------------------------------------
    Clyde A. Billings Jr.           William J. Schwindt
                                    Senior Vice President, Compensation and
                                    Benefits


                                PARTICIPANT:


                                ------------------------------------------------
                                J. Kenneth Glass
                                President and Chief Executive Officer


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>10
<FILENAME>ex10-5c.txt
<DESCRIPTION>EXHIBIT 10.5(C)
<TEXT>

<PAGE>


                                                                 EXHIBIT 10.5(c)

                      AGREEMENT TO DEFER RECEIPT OF SHARES
                            FOLLOWING OPTION EXERCISE

Fill in all of the following blanks with respect to your election to defer
receipt of shares following an option exercise. Please print. Complete a
separate Agreement to Defer for each option grant for which you elect to defer.

Date:
      ---------------

Name:
      -------------------

Date of Option Grant:
                      ----------------------

Option Grant Number (e.g. 001462):
                                   ----------------

Name of Option Plan
(e.g., 1990 Stock Option Plan):
                                --------------------------

Number of Shares Remaining to be Exercised in Option:
                                                      --------------------------

Number of Shares Covered by this Deferral Election:
                                                    ----------------------------

Date of Distribution:
                      -----------------------------------------
                      (See Paragraph 7 below for instructions.)

Beneficiary designation:
                         --------------------------------------
                            (See Paragraph 12 and 13 below.)

     This Agreement is made and entered into as of the date stated above by and
between the individual named above (the "Participant") and First Tennessee
National Corporation (the "Corporation").

                                   WITNESSETH

     WHEREAS, the Corporation has established a stock option enhancement program
(the "Program") for certain employees of the Corporation and its subsidiaries
pursuant to which the grantee of a stock option who complies with the terms and
conditions of the Program is permitted to elect to defer receipt of shares
covered by an option and thereby defer recognition of income for federal income
tax purposes at the time of the option exercise; and

     WHEREAS, Participant has been selected to participate in the Program,
subject to the right of the Human Resources Committee of the Board of Directors
to cancel the Program as to any unexercised options;


                                       1




<PAGE>


     NOW, THEREFORE, in consideration of the promises made herein, Participant
and the Corporation do agree as follows:

     1.   Subject to the terms and conditions of the Program described below,
          Participant hereby irrevocably elects to defer receipt of the shares
          specified following the exercise of the option, or portion thereof,
          specified for the period of time specified, and the Corporation agrees
          to deliver to Participant at the time specified the shares whose
          receipt has been deferred (adjusted to reflect any stock splits and
          stock dividends as described below) and an amount of cash equivalent
          to the dividends that would have been paid had Participant received
          the shares immediately following the exercise of the option plus
          interest on such dividend equivalents at a 10-year Treasury rate of
          interest, all as described below.

     2.   Participant is permitted to exercise the option covered by this
          Agreement at any time beginning at least 6 months after the date of
          this deferral agreement and ending on the last day of the term of the
          option.

     3.   If Participant has elected to defer receipt of a number of shares that
          is less than the number of shares that is exercisable under the
          option, then the receipt of shares will be deferred as follows: on the
          first (and, if necessary, subsequent) exercise of the option occurring
          at least 6 months following the date of this deferral agreement,
          receipt of shares will be deferred until the number of shares elected
          for deferral has been reached.

     4.   The option cannot be exercised by tendering cash in payment of the
          exercise price. Participant must pay the exercise price with
          Corporation common stock. Participant must use the "attestation"
          method of exercising the option. Under the attestation method,
          Participant (and, if applicable, Participant's broker or bank or other
          party) must sign an attestation form, which must be submitted at the
          time of the option exercise, certifying ownership of a sufficient
          number of shares of Corporation common stock to pay the exercise
          price. Actual share certificates are not to be delivered to the
          Corporation.

     5.   The shares attested to must be "mature" shares; that is, the shares
          must either have been purchased on the open market by Participant or
          if the shares were acquired directly from the Corporation pursuant to
          an employee benefit plan, the shares must have been owned without any
          restrictions on transfer for at least six months prior to the option
          exercise.

     6.   Participant must be a current employee of the Corporation or one of
          its subsidiaries both at the time of execution of this Agreement and
          at the time of the exercise of the option. If Participant's employment
          terminates for any reason prior to the exercise of the option, then
          this Agreement is canceled.


                                       2




<PAGE>


     7.   Participant must select a deferral period, at the end of which shares
          whose receipt has been deferred and earnings thereon will be paid to
          Participant, subject to Paragraph 12 herein. The payment date is
          referred to herein as the "Date of Distribution." Participant may
          specify any future date, not to exceed actual retirement plus five
          years, as the Date of Distribution. Alternatively, Participant may
          specify payment to be made "on retirement" or "on retirement plus
          ___________ years and __________ months." Under this alternative, the
          payment date may not exceed actual retirement plus five years. For all
          purposes hereof, the term "retirement" includes any retirement,
          whether it is a normal or an early retirement. If the Date of
          Distribution is not a business day, payment will be made on the next
          day that is a business day.

     8.   When Participant decides to exercise the option, Participant must
          exercise the option for all of the shares covered by this deferral
          election. Upon the exercise of the option, no shares will be
          transferred to Participant and a deferral account will be established
          by the Corporation, consisting of a subaccount reflecting phantom
          stock units and a subaccount representing cash equal to the earnings
          credited to the account with respect to dividend equivalents and
          interest thereon. Participant's phantom stock subaccount will be
          credited with phantom stock units, based on the number of shares
          covered by this deferral election with respect to which the option was
          exercised by Participant, net of the number of shares attested to in
          payment of the exercise price, with each phantom stock unit being
          equivalent to one share of the Corporation's common stock. (NOTE: The
          number of phantom stock units credited to Participant's account is
          equal to the number of shares covered by the deferral election minus
          the number of shares attested to in payment of the option exercise
          price.)

     9.   Any stock split and stock dividend that is declared with respect to
          the Corporation's common stock having a payment date that occurs after
          exercise of the option and before the deferral period has terminated
          will result in a corresponding stock split or stock dividend being
          made with respect to the phantom shares of the Corporation's common
          stock in Participant's deferral account. In other words, Participant
          will be issued that number of shares of the Corporation's common stock
          at the termination of the deferral period that Participant would have
          owned had he or she exercised the option without deferring receipt of
          the shares and then maintained ownership of such common stock through
          the payment date of the stock dividend or stock split.

     10.  Earnings will be credited to Participant's cash subaccount and accrued
          on the phantom stock units as follows: on each date on which the
          Corporation pays a dividend on its shares of common stock, an amount
          equal to such dividend will be credited to Participant's account with
          respect to each phantom stock unit. Then, as of January 1st of each
          year, an additional amount will be credited to Participant's account
          to reflect earnings on the dividend equivalents from the time they
          were credited to the account for the prior plan year. The rate of
          earnings credited for the year will be the rate disclosed under the
          caption "Annualized Ten Year Treasury Rate" in the Federal Reserve
          Statistical Release in January of the year following the


                                       3




<PAGE>


          year with respect to which earnings are to be credited, and the amount
          will be computed by multiplying the dividend equivalent by the rate by
          a factor representing the fraction of the year (100% for a January 1
          dividend equivalent, 75% for an April 1 dividend equivalent, 50% for a
          July 1 dividend equivalent, and 25% for a October 1 dividend
          equivalent) remaining after the dividend equivalent was credited to
          Participant's account. Interest will compound as follows: for any cash
          credited to the account that existed on the first day of the prior
          plan year (excluding any dividend equivalent that is credited to the
          account on such day), earnings will be credited in an amount equal to
          the amount of such cash multiplied by the applicable ten year treasury
          rate factor. For the portion of the Plan year in which the Date of
          Distribution occurs, earnings will be credited on any cash credited to
          the account during such year from the time such cash is credited
          through the Date of Distribution at the rate employed for the previous
          year.

     11.  Payment from Participant's deferral account will be made in a single
          lump sum, computed as follows: with respect to Participant's phantom
          stock subaccount, one share of the Corporation's common stock will be
          paid to Participant for each phantom stock unit credited to such
          subaccount, and with respect to Participant's cash subaccount, cash in
          the amount credited to the subaccount will be paid to Participant.

     12.  Payment from Participant's deferral account will be made to
          Participant (or, in the event of Participant's death, his or her
          beneficiary) on the earliest of the date selected by Participant as
          the Date of Distribution, the date of a change in control as defined
          in the Plan specified above or a date selected by the Corporation
          following Participant's death, disability, or termination of
          employment for any reason other than normal or early retirement that
          is no later than the last day of the month following the month in
          which there occurs the death, disability, or termination of employment
          of Participant for any reason other than normal or early retirement.

     13.  For any and all purposes of this deferral agreement and the Plan
          specified above, Participant designates the person specified above as
          his/her beneficiary under the Plan.

     14.  Participant is limited to one deferral agreement per option grant
          outstanding at any one time.

     15.  The Human Resources Committee of the Board of Directors retains the
          right to cancel the Program and prohibit deferral of receipt of shares
          following an option exercise with respect to any unexercised options
          then held by Participant upon notice to Participant.

     16.  The Human Resources Committee is authorized to interpret and
          administer the Program and the terms and provisions of this Agreement.

     IN WITNESS WHEREOF, Participant has executed and the Corporation has caused
its duly
                                       4




<PAGE>

authorized officer to execute this Agreement, each as of the day and year first
above written.

FIRST TENNESSEE NATIONAL CORPORATION


By:
    -----------------------------       ----------------------------------------
    Executive Vice President,           Participant
    Division Manager Personnel,
    or other authorized signatory

Risk Statement:

If the fair market value of Corporation common stock drops below the fair market
value on the date of exercise of the option (with respect to which receipt of
shares is deferred) and does not recover before the end of the deferral period,
a portion of the value of such shares will be lost. Thereafter, the value of
such shares may increase or decrease further.

If Participant does not exercise the option covered by this Agreement in
accordance with all of the terms of this Agreement, the option will be forfeited
by Participant and canceled by the Corporation.


                                       5


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>11
<FILENAME>ex10-5d.txt
<DESCRIPTION>EXHIBIT 10.5(D)
<TEXT>

<PAGE>


                                                                 EXHIBIT 10.5(d)


                   AGREEMENT TO EXCHANGE SHARES FOR RSU's AND
                             DEFER RECEIPT OF SHARES

Fill in all of the following blanks with respect to your election to exchange
shares of restricted stock for restricted stock units ("RSU's") (as defined
below) and thereby defer receipt of shares under the 1992 Restricted Stock
Incentive Plan, as amended. Please print. Complete a separate Agreement for each
amount of shares covered by a performance period that is subject to accelerated
vesting for which you elect to defer.

Date: ________________

Performance Period Ending: ____________________

                                         To be completed by Personnel Division:
                                         Effective Date: ___________________

Number of Restricted Shares Covered by this
Deferral Election:  ______________ (See Paragraph 8 below.)

Date of Distribution:_______________________________________________________
                             (See Paragraph 6 below for instructions.)

Beneficiary designation:_____________________________________________________
                                 (See Paragraphs 13 and 14 below.)

Dividend equivalents:________________________________________________________
                           (Insert "Pay Now" [See Paragraph 16 below]
                               or "Defer" [See Paragraph 11 below].)

         This Agreement is made and entered into as of the date stated above by
and between the individual named above (the "Participant") and First Tennessee
National Corporation (the "Corporation").

                                   WITNESSETH

         WHEREAS, the Corporation has established a deferral program (the
"Program") for certain employees of the Corporation and its subsidiaries who are
participants in the Corporation's 1992 Restricted Stock Incentive Plan, as
amended (the "Plan"), pursuant to which the grantee of an award under the Plan
who meets the eligibility requirements of the Program and who complies with the
terms and conditions of the Program is permitted to elect to exchange shares of
restricted stock for restricted stock units and thereby defer receipt of shares
and defer recognition of income for federal income tax purposes; and

         WHEREAS, Participant desires to make a deferral election under the
Program;

         NOW, THEREFORE, in consideration of the promises made herein,
Participant and the Corporation do agree as follows:

         1. Subject to the terms and conditions of the Program described below,
            Participant hereby irrevocably elects to exchange the number of
            shares of restricted stock identified above for





                                       1






<PAGE>


            restricted stock units ("RSU's") and hereby defer receipt of
            shares for the period of time specified, and the Corporation
            agrees to deliver to Participant at the time specified the shares
            whose receipt has been deferred (adjusted to reflect any stock
            splits and stock dividends as described below) and an amount of
            cash equivalent to the dividends that would have been paid after
            the Effective Date (defined below) and prior to the Date of
            Distribution (defined below) had Participant not made a deferral
            election and continued to own the shares during the period
            specified plus interest on such dividend equivalents at a 10-year
            Treasury rate of interest, all as described below.

         2. Participant must meet one of the following requirements: (a)
            Participant must have received an award under Section 5 of the Plan,
            at least some of the restrictions on which had not lapsed as of
            December 15, 1998 or (b) Participant must have received an award
            under Section 5 of the Plan after December 15, 1998 and
            Participant's restricted stock agreement ("Restricted Stock
            Agreement") provides that Participant may elect to defer under the
            Plan with respect to such award.

         3. The Effective Date of this Agreement must occur before restrictions
            are scheduled to lapse on the Restricted Shares specified above and
            must be at least any minimum number of days before restrictions are
            scheduled to lapse that is required by the Committee.

         4. Participants must tender certificates for the shares of restricted
            stock with respect to which this Agreement is being entered into at
            the time the Agreement is tendered, if the shares are not held in
            book-entry format by the Corporation's transfer agent. Participant
            agrees to execute any form that may be required by the transfer
            agent with respect to book-entry or certificated shares.

         5. The Effective Date of the deferral election is the close of business
            on the business day on which the Manager of the Personnel Division,
            or her designee, receives the deferral election and, if the shares
            of restricted stock are not held in book-entry format, certificates
            for the shares of restricted stock with any properly completed and
            executed stock powers that may be requested by the Personnel
            Division.

         6. Participant must select a deferral period, at the end of which
            shares whose receipt has been deferred and earnings thereon will be
            paid to Participant, subject to Paragraph 13 herein. The payment
            date is referred to herein as the "Date of Distribution."
            Participant may specify any future date, not to exceed actual
            retirement plus five years, as the Date of Distribution.
            Alternatively, Participant may specify payment to be made "on
            retirement" or "on retirement plus __ years and __ months." Under
            this alternative, the payment date may not exceed actual retirement
            plus five years. For all purposes hereof, the term "retirement"
            includes any retirement, whether it is a normal or an early
            retirement. If the Date of Distribution is not a business day,
            payment will be made on the next day that is a business day.

         7. Until the accelerated lapse date approved by the Committee, or if
            accelerated performance criteria are not met, until the date
            specified in the participant's Restricted Stock Agreement as the
            date on which restrictions on the Restricted Shares will lapse,
            RSU's will remain subject to forfeiture in the same manner as
            Restricted Shares would have remained subject to forfeiture under
            the provisions of the Plan and related Restricted Stock Agreement,
            except as is provided below in the event of death, disability,
            retirement, other termination of employment, or Change in Control.
            In other words, RSU's will be subject to restrictions identical to
            the restrictions on Restricted Shares, and restrictions on RSU's
            will lapse, if at





                                       2






<PAGE>


            all, at the same time that restrictions on Restricted Shares
            would have lapsed had Participant not made a deferral election.
            If accelerated performance criteria have been met, then RSU's
            will be fully vested and not subject to forfeiture.

         8. Participant's deferral election must be for 100% percent of the
            shares of restricted stock with respect to which restrictions are
            scheduled to lapse if performance criteria are met for a performance
            period (generally 1/3 of the shares originally awarded). Participant
            may make a separate election for each of the three different
            accelerated performance criteria performance periods applicable to
            an award under the Plan, but any election must be for 100 percent of
            the shares with respect to which restrictions may lapse if
            performance criteria are met.

         9. Upon the Effective Date, a deferral account will be established by
            the Corporation, consisting of a subaccount reflecting RSU's and,
            unless Participant has elected to receive earnings attributable to
            RSU's currently, and not on a deferred basis, pursuant to Paragraph
            16, a subaccount representing cash equal to the earnings credited to
            the account with respect to dividend equivalents and interest
            thereon. Participant's RSU subaccount will be credited with RSU's,
            based on the number of shares of restricted stock covered by this
            deferral election, with each RSU being equivalent to one share of
            the Corporation's common stock. Additional RSU's will be credited to
            participant's RSU subaccount at the time of payment of any stock
            split or stock dividend on the Corporation's common stock, in
            accordance with Paragraph 10 herein.

        10. Any stock split and stock dividend that is declared with respect to
            the Corporation's common stock having a payment date that occurs on
            or after the Effective Date and before the deferral period has
            terminated will result in a corresponding stock split or stock
            dividend being made with respect to the RSU's in Participant's
            deferral account with the result that Participant will be issued
            that number of shares of the Corporation's common stock at the
            termination of the deferral period that Participant would have owned
            had he or she received shares of restricted stock, without
            restriction, at the time of the lapsing of restrictions on the
            restricted stock had Participant not entered into this Agreement and
            had Participant then maintained ownership of such common stock
            through the payment date of the stock dividend or stock split.

        11. Earnings will be credited to Participant's cash subaccount and
            accrued on the RSU's as follows: on each date on which the
            Corporation pays a dividend on its shares of common stock, an amount
            equal to such dividend will be credited to Participant's account
            with respect to each RSU. Then, as of January 1st of each year, an
            additional amount will be credited to Participant's account to
            reflect earnings on the dividend equivalents from the time they were
            credited to the account for the prior plan year. The rate of
            earnings credited for the year will be the rate disclosed under the
            caption "Annualized Ten Year Treasury Rate" in the Federal Reserve
            Statistical Release in January of the year following the year with
            respect to which earnings are to be credited, and the amount will be
            computed by multiplying the dividend equivalent by the rate by a
            factor representing the fraction of the year (e.g., 100% for a
            January 1st dividend equivalent, 75% for an April 1st dividend
            equivalent, 50% for a July 1st dividend equivalent, and 25% for a
            October 1 dividend equivalent) remaining after the dividend
            equivalent was credited to Participant's account. Interest will
            compound as follows: for any cash credited to the account that
            existed on the first day of the prior plan year (excluding any
            dividend equivalent that is credited to the account on such day),
            earnings will be credited in an amount equal to the amount of such
            cash multiplied by the applicable ten year treasury rate factor. For
            the portion of the year in which a distribution from the deferral



                                       3






<PAGE>


            account is made to Participant, earnings will be credited on any
            cash credited to the account during such year from the time such
            cash is credited through the date of distribution at the rate
            employed for the previous year.

        12. Payment from Participant's deferral account will be made in a
            single lump sum, computed as follows: with respect to Participant's
            RSU subaccount, one share of the Corporation's common stock will be
            paid to Participant for each RSU credited to such subaccount, and
            with respect to Participant's cash subaccount, cash in the amount
            credited to the subaccount will be paid to Participant.

        13. Payment from Participant's deferral account will be made to
            Participant (or, in the event of Participant's death, his or her
            beneficiary) only at the following times: (1) if restrictions on the
            RSU's have already lapsed at the time payment is scheduled to be
            made, then on the earliest to occur of the following dates: the date
            selected by Participant, the date of a Change in Control as defined
            in the Plan, or a date selected by the Corporation following
            Participant's death, disability, or termination of employment for
            any reason other than normal or early retirement that is no later
            than the last day of the month following the month in which there
            occurs the death, disability, or termination of employment of
            Participant for any reason other than normal or early retirement, or
            (2) if restrictions on the RSU's have not lapsed at the time payment
            is otherwise scheduled to be made and subject to the last two
            sentences of this Paragraph 13, then on the earliest to occur of the
            following dates: (i) the later of the date selected by Participant
            or the date restrictions on the RSU's lapse, if the shares have not
            been forfeited before such lapse date, (ii) the date of a Change in
            Control as defined in the Plan, or (iii) a date selected by the
            Corporation following Participant's death, or if the Committee
            approves, the participant's retirement or disability that is no
            later than the last day of the month following the month in which
            there occurs the death or, if the Committee has approved, the
            disability or retirement of Participant. The RSU's and any right to
            receive Restricted Shares without restrictions will be forfeited by
            Participant if there occurs a termination of the participant's
            employment prior to the lapsing of restrictions on RSU's or if
            Participant becomes disabled or retires prior to a lapsing of
            restrictions on RSU's and the Committee has not acted to approve
            payment to Participant in the event of disability or retirement.
            Notwithstanding a forfeiture of RSU's, the balance in Participant's
            cash subaccount within Participant's deferral account will be paid
            to Participant immediately following the occurrence of such a
            forfeiture.

        14. For any and all purposes of this Agreement and the Plan,
            Participant designates the person specified above as his/her
            beneficiary under the Plan.

        15. The Human Resources Committee is authorized to interpret and
            administer the Program and the terms and provisions of this
            Agreement.

        16. Participant is permitted to elect to receive earnings attributable
            to Participant's RSU subaccount currently, and not on a deferred
            basis, by indicating such an election on Participant's irrevocable
            deferred agreement. If such an election is made, Participant will
            receive in cash on each date on which the Corporation pays a
            dividend on its shares of common stock an amount equal to such
            dividend with respect to each RSU in Participant's RSU account. Such
            payment will be made in lieu of crediting any amount to
            Participant's cash subaccount pursuant to Paragraph 11 and
            Participant's cash subaccount will be deemed to be "zero" for all
            purposes of the Plan and this Agreement.





                                       4






<PAGE>


         IN WITNESS WHEREOF, Participant has executed and the Corporation has
caused its duly authorized officer to execute this Agreement, each as of the day
and year first above written.

FIRST TENNESSEE NATIONAL CORPORATION


By:__________________________________                 _________________________
    Executive Vice President,                         Participant
    Division Manager Personnel,
    or other authorized signatory

Risk Statement:

If the fair market value of Corporation common stock drops below the fair market
value on the Effective Date and does not recover before the end of the deferral
period, a portion of the value of such shares will be lost. Thereafter, the
value of such shares may increase or decrease further.

If Participant's employment terminates for a reason other than death, or if the
Committee approves, disability or retirement, before the restrictions on the
RSU's lapse, the right to receive shares at the end of the deferral period will
be forfeited by Participant and canceled by the Corporation.





                                       5





</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>12
<FILENAME>ex10-5e.txt
<DESCRIPTION>EXHIBIT 10.5(E)
<TEXT>

<PAGE>


                                                                 EXHIBIT 10.5(e)

                        FORM OF STOCK OPTION GRANT NOTICE

Note: There is some variation from time to time in the forms used for grant
      notices. This exhibit reflects the substance of the notices used, without
      providing or describing the many immaterial variations.

                        * * * * * * * * * * * * * * * * *

                                NOTICE OF GRANT
                            -----------------------
                            MANAGEMENT STOCK OPTIONS

[Name and ID of recipient]

You have been granted a management stock option to purchase First Horizon
National Corporation stock as follows:

================================================================================

Date of Grant:

Stock Option Plan:

Option Price per Share: [fair market value on grant date]

Total Number of Shares:

Total Fair Market Value of Shares Granted:

[A vesting schedule is provided in the notice. Vesting varies with the grade
level of the option recipient and vesting practices are subject to change over
time. Specific vesting schedules are omitted.]

Date Option Expires: [seven or ten years after grant date]
[At the time this exhibit is filed, options granted to senior executive officers
have 7-year terms. Earlier options have had 7- and 10-year terms.]

This grant includes a performance accelerated feature that allows the grant to
vest 100 percent in the first three years after grant if the company's closing
stock price meets or exceeds the performance goal ($_____ for the [date] grant)
for five consecutive business days.

Management stock options recognize your leadership and performance within the
organization. This option is granted under and governed by the terms and
conditions of FHN's [name of applicable plan].



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>13
<FILENAME>ex10-5f.txt
<DESCRIPTION>EXHIBIT 10.5(F)
<TEXT>

<PAGE>


                                                                 EXHIBIT 10.5(f)

                 FORM OF STOCK OPTION RELOAD GRANT NOTIFICATION

Note: There is some variation from time to time in the forms used for grant
      notices. This exhibit reflects the substance of the reload notices used,
      without providing or describing the many immaterial variations. Also, the
      Company has discontinued the reload feature. This exhibit is provided
      because prior reload grants remain outstanding.

                        * * * * * * * * * * * * * * * * *

[Date]

[Name and address of recipient]

Pursuant to the terms and conditions of the company's [name of applicable plan],
you have been granted a Non-Qualified Stock Option/Reload to purchase ________
shares (the "Option") of stock as outlined below:

Granted to: [Name and ID of recipient]

Grant Date:

Options Granted: [number]

Option Price per Share: [fair market value on reload grant date]

Total Cost to Exercise:

Expiration Date: [the expiration date of the original options on
                 which the reload grant is based]

Vesting Schedule: [typically, reload options are fully
                  vested at grant]



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>14
<FILENAME>ex10-13.txt
<DESCRIPTION>EXHIBIT 10.13
<TEXT>

<PAGE>


                                                                   EXHIBIT 10.13

                               INDEMNITY AGREEMENT

     This Agreement, effective as of January 20, 2004, is made and entered into
between First Horizon National Corporation, a Tennessee corporation
("Corporation"), and _____________, a director or officer of Corporation or one
of its subsidiaries ("Indemnitee").

     WHEREAS, Corporation desires to attract and retain outstanding persons as
directors and officers of it and its subsidiaries; and

     WHEREAS, Corporation and Indemnitee recognize the increased risk of
litigation and claims being asserted against directors and certain officers of
public companies and their subsidiaries and the need for Corporation to provide
protection against personal liability to enhance Indemnitee's effective service
to Corporation; and

     WHEREAS, Corporation desires to provide in this Agreement for the
indemnification of and advancing of expenses to Indemnitee to the maximum extent
permitted (or not prohibited) by law and as set forth in this Agreement and, to
the extent such insurance is maintained by Corporation, for the continued
coverage of Indemnitee under Corporation's directors and officers liability
insurance policies;

     NOW, THEREFORE, in consideration of the factors stated above, the promises
contained herein, and Indemnitee's continuing to serve Corporation directly or,
at its request, indirectly through a subsidiary, and intending to be legally
bound hereby, the parties agree as follows:

1.   Definitions.

     (a) "Change in Control" means the occurrence of any one of the following
events:

          (i) individuals who, on January 21, 1997, constitute the Board (the
     "Incumbent Directors") cease for any reason to constitute at least a
     majority of the Board, provided that any person becoming a director
     subsequent to January 21, 1997, whose election or nomination for election
     was approved by a vote of at least three-fourths (3/4) of the Incumbent
     Directors then on the Board (either by a specific vote or by approval of
     the proxy statement of the Company in which such person is named as a
     nominee for director, without written objection to such nomination) shall
     be an Incumbent Director; provided, however, that no individual elected or
     nominated as a director of the Company initially as a result of an actual
     or threatened election contest with respect to directors or as a result of
     any other actual or threatened solicitation of proxies or consents by or on
     behalf of any person other than the Board shall be deemed to be an
     Incumbent Director;

          (ii) any "Person" (as defined under Section 3(a)(9) of the Securities
     Exchange Act of 1934, as amended (the "Exchange Act") and as used in
     Section 13(d) or Section 14(d) of the Exchange Act) is or becomes a
     "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
     directly or indirectly, of securities of the Company representing 20% or
     more of the combined voting power of the Company's then outstanding
     securities eligible to vote for the election of the Board (the "Company
     Voting Securities"); provided, however, that the event described in this
     paragraph (ii) shall not be deemed to be a change in control by virtue of
     any of the following


                                       1




<PAGE>


     acquisitions: (A) by the Company or any entity in which the Company
     directly or indirectly beneficially owns more than 50% of the voting
     securities or interests (a "Subsidiary"), (B) by an employee stock
     ownership or employee benefit plan or trust sponsored or maintained by the
     Company or any Subsidiary, (C) by any underwriter temporarily holding
     securities pursuant to an offering of such securities, or (D) pursuant to a
     Non-Qualifying Transaction (as defined in paragraph (iii));

          (iii) the consummation of a merger, consolidation, share exchange or
     similar form of corporate transaction involving the Company or any of its
     Subsidiaries that requires the approval of the Company's shareholders,
     whether for such transaction or the issuance of securities in the
     transaction (a "Business Combination"), unless immediately following such
     Business Combination: (A) more than 60% of the total voting power of (x)
     the corporation resulting from such Business Combination (the "Surviving
     Corporation"), or (y) if applicable, the ultimate parent corporation that
     directly or indirectly has beneficial ownership of 100% of the voting
     securities eligible to elect directors of the Surviving Corporation (the
     "Parent Corporation"), is represented by Company Voting Securities that
     were outstanding immediately prior to the consummation of such Business
     Combination (or, if applicable, is represented by shares into which such
     Company Voting Securities were converted pursuant to such Business
     Combination), and such voting power among the holders thereof is in
     substantially the same proportion as the voting power of such Company
     Voting Securities among the holders thereof immediately prior to the
     Business Combination, (B) no person (other than any employee benefit plan
     sponsored or maintained by the Surviving Corporation or the Parent
     Corporation), is or becomes the beneficial owner, directly or indirectly,
     of 20% or more of the total voting power of the outstanding voting
     securities eligible to elect directors of the Parent Corporation (or, if
     there is no Parent Corporation, the Surviving Corporation) and (C) at least
     two-thirds (2/3) of the members of the board of directors of the Parent
     Corporation (or, if there is no Parent Corporation, the Surviving
     Corporation) were Incumbent Directors at the time of the Board's approval
     of the execution of the initial agreement providing for such Business
     Combination (any Business Combination which satisfies all of the criteria
     specified in (A), (B) and (C) above shall be deemed to be a "Non-Qualifying
     Transaction"); or

          (iv) the shareholders of the Company approve a plan of complete
     liquidation or dissolution of the Company or a sale of all or substantially
     all of the Company's assets.

     Notwithstanding the foregoing, a Change in Control of the Company shall not
be deemed to occur solely because any person acquires beneficial ownership of
more than 20% of the Company Voting Securities as a result of the acquisition of
Company Voting Securities by the Company which reduces the number of Company
Voting Securities outstanding; provided, that if after such acquisition by the
Company such person becomes the beneficial owner of additional Company Voting
Securities that increases the percentage of outstanding Company Voting
Securities beneficially owned by such person, a Change in Control of the Company
shall then occur.

     (b) "Claim" is defined as any threatened, pending or contemplated action,
suit or proceeding, or any inquiry or investigation, whether conducted by
Corporation or any other party, that Indemnitee believes might lead to the
institution of any action, suit or proceeding, whether civil, criminal,
administrative, investigative, or other, in any way arising out of or in
connection with or related to any event or occurrence related to the fact that
Indemnitee is or was a director or officer of Corporation or any of its
subsidiaries, or


                                       2




<PAGE>


is or was serving at the request of Corporation or any of its subsidiaries as a
director, officer, employee, trustee, agent or fiduciary of another corporation,
partnership, joint venture, employee benefit plan, political action committee,
trust or other enterprise, or by reason of anything done or not done by
Indemnitee in any such capacity. As used herein, Claim shall include, but is not
limited to, any threatened, pending or contemplated action, suit or proceeding,
or any inquiry or investigation, in any way arising out of or alleging any act,
error or omission by the Indemnitee in the rendering or failure to render
professional services, including legal and accounting services, for or at the
request of the Corporation or any of its subsidiaries; provided such
professional services are within the reasonably anticipated scope of the
Indemnitee's duties. Additionally, as used herein, "Claim" shall include, but is
not limited to, any threatened, pending or contemplated action, suit or
proceeding arising out of or alleging negligence on the part of the Indemnitee.

     (c) "Expenses" is defined as attorney's fees and all other costs, expenses
and obligations paid or incurred in connection with investigating, defending,
being a witness in or participating in (including any appeals) or preparing to
defend, be a witness in or participate in any Claim.

     (d) "Losses" is defined as any judgments, fines, penalties and amounts paid
in settlement or discharge, including all interest assessments and other charges
paid or payable in connection therewith, of a Claim and for which Indemnitee has
not been otherwise reimbursed.

     (e) "Reviewing Party" is defined as (i) the directors of Corporation that
are not parties to or interested in the Claim (provided that there shall be at
least two such independent directors) or (ii) in the event that there are not at
least two independent directors or there has been a Change in Control, special,
independent counsel, selected in the manner provided in Section 6.

     2.   Basic Indemnification.

     Subject to the limitations provided in the following sentence and Section 3
herein, Corporation shall indemnify and hold harmless Indemnitee in connection
with any Claim against any and all Expenses and Losses to the maximum extent
permitted (or not prohibited) by law and, if requested by Indemnitee, shall
advance Expenses as soon as practicable but in any event no later than 30 days
after written demand is presented to Corporation. Except as set forth in Section
4 herein, Indemnitee will not be entitled to indemnification pursuant to this
Agreement in connection with any Claim initiated by Indemnitee against
Corporation or any of its subsidiaries or any director or officer of it or of
any of its subsidiaries except for a Claim in which Corporation has joined or
the initiation of which the Corporation has consented to. In connection with any
determination by Reviewing Party or otherwise as to whether Indemnitee is
entitled to be indemnified under any provision of this Agreement, the burden of
proof shall be on Corporation to establish that Indemnitee is not so entitled.

     3.   Limitations on Indemnification.

     Notwithstanding anything herein to the contrary (except for any additional
rights contemplated by Section l0(b) herein), the obligations of Corporation to
indemnify Indemnitee under Section 2 shall be subject to the condition that
Reviewing Party shall not have determined that Indemnitee would not be permitted
to be indemnified under applicable law. Corporation is obligated to advance
Expenses within the time period specified in Section 2 herein unless, during
such time period and prior to Expense


                                       3




<PAGE>


advancement, Reviewing Party determines that Indemnitee would not be permitted
to be so indemnified under applicable law. If Expenses are advanced and
Reviewing Party subsequently determines that Indemnitee would not be permitted
to be so indemnified under applicable law, Corporation shall be entitled to be
reimbursed by Indemnitee (who hereby agrees to reimburse Corporation) for all
such amounts theretofore paid; provided, if Indemnitee has commenced legal
proceedings in a court of competent jurisdiction to secure a determination that
Indemnitee should be indemnified under applicable law, any determination made by
Reviewing Party that Indemnitee would not be permitted to be indemnified under
applicable law shall not be binding, and Indemnitee shall not be required to
reimburse Corporation for any Expenses advanced until a final judicial
determination is made with respect thereto as to which all rights of appeal
therefrom have been exhausted or lapsed. If there has been no determination by
Reviewing Party or Expenses are not advanced within the time frame provided in
Section 2 or if Reviewing Party determines that Indemnitee would not be
permitted to be indemnified in whole under applicable law, Indemnitee shall have
the right to commence litigation in any court in the state of Tennessee having
subject matter jurisdiction thereof and in which venue is proper seeking an
initial determination by the court or challenging any such determination by
Reviewing Party or any aspect thereof, and Corporation hereby consents to
service of process and to appear in any such proceeding. Any determination by
Reviewing Party otherwise shall be conclusive and binding on Corporation and
Indemnitee. Corporation shall have the burden of proving that Indemnitee is not
entitled to indemnification in any such legal proceeding.

     4.   Indemnification for Additional Expenses.

     Corporation shall indemnify Indemnitee against any and all expenses
(including attorneys' fees and all other costs, expenses, and obligations of the
same sort as contemplated by Section l(c)) and, if requested by Indemnitee,
shall advance such expenses to Indemnitee within 30 days after written demand is
presented to Corporation, which expenses are incurred by Indemnitee in
connection with any claim asserted against or claim or action brought by
Indemnitee for indemnification or advance payment of Expenses by Corporation
under this Agreement or for recovery under any directors and officers liability
insurance policies maintained by Corporation, regardless of whether Indemnitee
ultimately is determined to be entitled to such indemnification, expense advance
or insurance recovery. [Note: The expenses provided in Section 4, which are not
repayable to Corporation, are different from the Expenses permitted in Section
2, which must be repaid to Corporation in the situation described in Section 3.]

     5.   Insurance.

     To the extent Corporation maintains insurance policies providing directors
and officers liability insurance, Indemnitee shall be covered by such policies,
in accordance with their terms, to the maximum extent of the coverage available
for any Corporation director or officer.

     6.   Change in Control.

     Corporation agrees that if there is a Change in Control, then with respect
to all matters thereafter arising concerning the rights of Indemnitee to
indemnity payments and Expense advances under this Agreement or any other
agreement or Corporation Charter or Bylaw provision now in effect or hereafter
adopted relating to Claims, Corporation shall seek legal advice only from
special, independent counsel selected by Indemnitee and approved by Corporation
(which approval shall not be unreasonably withheld). Such counsel, among other
things, shall render its written opinion to Corporation and Indemnitee as to


                                       4




<PAGE>


whether and to what extent Indemnitee would be permitted to be indemnified under
applicable law. Corporation agrees to pay the fees of the special, independent
counsel referred to above and fully to indemnify such counsel against any and
all expenses and losses of the same sort as contemplated by Sections l(c) and
l(d) arising out of or relating to this Agreement or its engagement pursuant
hereto.

     7.   Creation of Trust.

     In the event of a Change in Control or if the Board determines that a
Change in Control is imminent, Corporation shall (and the appropriate officers
of Corporation are hereby authorized and directed to take all action deemed
necessary or desirable in connection herewith) upon the written request of
Indemnitee, create a trust or appropriately amend an existing trust for the
benefit of Indemnitee and from time to time upon written request of Indemnitee
shall fund such trust in an amount sufficient to satisfy any and all Expenses
reasonably anticipated at the time of each such request and any and all Losses
from time to time actually paid or claimed, reasonably anticipated or proposed
to be paid. The amount or amounts to be deposited in the trust pursuant to the
foregoing shall be determined by Reviewing Party. The trustee shall be chosen by
Corporation, but the trustee may not be a party to or interested in a Claim nor
may the trustee be any person or entity (or an affiliate thereof) whose direct
or indirect ownership of Corporation stock has triggered a Change in Control.
Any trust established or amended pursuant hereto shall provide, with respect to
the rights and obligations created under this Agreement, that upon a Change in
Control (i) the trust shall not be revoked or the principal thereof invaded
without the written consent of Indemnitee, (ii) the trustee shall advance any
and all Expenses to Indemnitee within thirty days after written demand is
presented to the trustee (and Indemnitee hereby agrees to reimburse the trust
under the circumstances under which Indemnitee would be required to do so under
Section 3 herein), (iii) the trust shall continue to be funded by Corporation in
accordance with the funding obligations set forth above, (iv) the trustee shall
promptly pay to Indemnitee all amounts for which Indemnitee shall be entitled to
indemnification pursuant to this Agreement or otherwise, and (v) all unexpended
funds in such trust attributable to a Claim, Expense or Loss of Indemnitee shall
revert to Corporation upon a final determination by Reviewing Party or a court
of competent jurisdiction that Indemnitee has been fully indemnified under this
Agreement. If Section 7(v) would otherwise be applicable, then notwithstanding
anything in Section 7(v) to the contrary, at any time a Claim is still pending
against a director or officer of Corporation or any of its subsidiaries who has
entered into an agreement with Corporation substantially similar to this
Agreement, any funds held by the trustee under this Section 7 shall be retained
by the trustee until a final determination is made with respect to such Claim
and such funds may be used to pay such Claim. Nothing in this Section shall
relieve Corporation of any of its obligations under this Agreement.

     8.   Partial Indemnity.

     If Indemnitee is entitled under any provision of this Agreement to
indemnification by Corporation for some or a portion of the Expenses or Losses
but not for the total amount thereof, Corporation shall nevertheless indemnify
Indemnitee for the portion thereof to which Indemnitee is entitled.

     9.   Notification.

     Promptly after receipt by Indemnitee of notice of the commencement of any
Claim with respect to which Indemnitee may seek indemnification under this
Agreement, Indemnitee will notify Corporation of the commencement thereof. The
failure of Indemnitee promptly to notify Corporation hereunder shall not,


                                       5




<PAGE>


however, relieve Corporation of its obligations hereunder unless and to the
extent that Corporation was materially prejudiced by such failure to notify
promptly. Corporation will be entitled to participate in a Claim at its own
expense and to assume the defense thereof, with counsel satisfactory to
Indemnitee, unless Indemnitee shall have reasonably concluded that there may be
a conflict of interest between Corporation and Indemnitee in the conduct of the
defense of such action. Even if Indemnitee concludes that no conflict of
interest exists, Indemnitee shall retain the right to employ his or her own
counsel and participate in such action, suit or proceeding, but the fees and
expenses of such counsel incurred after notice from Corporation of its
assumption of the defense thereof shall be at the expense of Indemnitee unless
(i) the employment of counsel by Indemnitee has been authorized or the defense
of the Claim is not permitted to be undertaken by Corporation, or (ii)
Corporation shall not in fact have employed counsel to assume such defense.
Corporation shall not be liable to indemnify Indemnitee under this Agreement for
any amounts paid in settlement of any Claim effected without its written
consent. Corporation shall not settle any Claim in any manner which would impose
any penalty or limitation on Indemnitee without Indemnitee's written consent.
Neither Corporation nor Indemnitee will unreasonably withhold consent to any
proposed settlement.

     10.  Miscellaneous.

     (a) Presumptions. For purposes of this Agreement, the termination of any
claim, action, suit or proceeding, by judgment, order or settlement (whether
with or without court approval) or conviction, or upon a plea of nolo
contendere, or its equivalent, shall not create a presumption that Indemnitee
did not meet any particular standard of conduct or have any particular belief or
that a court has determined that indemnification is not permitted by applicable
law.

     (b) Nonexclusive Rights. The rights of Indemnitee hereunder shall be in
addition to any other rights Indemnitee may have under Corporation's Charter and
Bylaws and the Tennessee Business Corporation Act or otherwise. To the extent
that a change in the Tennessee Business Corporation Act (whether by statute or
judicial decision) permits greater indemnification by agreement than would be
afforded currently under Corporation's Charter and Bylaws and this Agreement, it
is the intent of the parties hereto that Indemnitee shall enjoy by virtue of
this Agreement the greater benefits so afforded by such change.

     (c) Amendment. No supplement, modification or amendment of this Agreement
shall be binding unless executed in writing by both of the parties hereto. No
waiver of any of the provisions of this Agreement shall be deemed or shall
constitute a waiver of any other provision hereof (whether or not similar) nor
shall such waiver constitute a continuing waiver.

     (d) Subrogation. In the event of payment under this Agreement, Corporation
shall be subrogated to the extent of such payment to all rights of recovery of
Indemnitee, who shall execute all papers required and shall do everything that
may be necessary to secure such rights, including execution of such documents as
may be necessary to enable Corporation effectively to bring suit to enforce such
rights.

     (e) Duplicate Payment. Corporation shall not be liable under this Agreement
to make any payment in connection with any Claim made against Indemnitee to the
extent Indemnitee has otherwise actually received payment (under any insurance
policy, Charter provision, Bylaw, or otherwise) of the amounts otherwise
indemnifiable hereunder.


                                       6




<PAGE>


     (f) Binding Effect. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors, assigns (including any direct or indirect successor or assign by
purchase, merger, consolidation or otherwise to all or substantially all of the
business and/or assets of Corporation), spouses, heirs, and personal and legal
representatives. This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as a director or officer of Corporation or any of
its subsidiaries or of any other entity at Corporation's request.

     (g) Severability. The provisions of this Agreement shall be severable in
the event that any of the provisions hereof (including any provision within a
single section, paragraph or sentence) are held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the maximum extent permitted by law.

     (h) Headings of Sections. Section and subsection headings are for
convenience only and shall not affect the construction of this Agreement.

     (i) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Tennessee.

     IN WITNESS WHEREOF, Corporation has caused this Agreement to be executed by
its duly authorized officers and Indemnitee has duly executed this Agreement,
each as of the day first above written.

ATTEST:                                 FIRST HORIZON NATIONAL CORPORATION


                                        By:
- -------------------------------------       ------------------------------------
                                        Name: [authorized officer]
Corporate Secretary                     Title:

                                        ----------------------------------------
                                        (Indemnitee)


                                       7


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-13
<SEQUENCE>15
<FILENAME>ex13.txt
<DESCRIPTION>EXHIBIT 13
<TEXT>

<Page>

                      FINANCIAL INFORMATION AND DISCUSSION
                               TABLE OF CONTENTS

<Table>
<S>                                                           <C>
Selected Financial and Operating Data                           2

Management's Discussion and Analysis of Results of
  Operations and Financial Condition                            3

    General Information                                         3

    Forward Looking Statements                                  4

    Financial Summary                                           4

    Business Line Review                                        5

    Income Statements Analysis -- 2004 compared to 2003         7

    Income Statements Analysis -- 2003 compared to 2002        16

    Statements of Condition Review                             17

    Risk Management                                            23

    Critical Accounting Policies                               38

    Quarterly Financial Information                            47

    Accounting Changes                                         48

    Subsequent Events                                          48

Glossary                                                       49

Report of Management on Internal Control over Financial
  Reporting                                                    53

Reports of Independent Registered Public Accounting Firm       54

Consolidated Statements of Condition                           56

Consolidated Statements of Income                              57

Consolidated Statements of Shareholders' Equity                58

Consolidated Statements of Cash Flows                          59

Notes to Consolidated Financial Statements                     60

Consolidated Average Balance Sheets and Related Yields and
  Rates                                                       112

Consolidated Historical Statements of Income                  114
</Table>

First Horizon National Corporation     1





<Page>


                     SELECTED FINANCIAL AND OPERATING DATA

<Table>
<Caption>
- -----------------------------------------------------------------------------------------------------------------
(Dollars in millions except per share
 data)                                      2004        2003        2002        2001        2000        1999
- -----------------------------------------------------------------------------------------------------------------
<S>                                       <C>         <C>         <C>         <C>         <C>         <C>
NET INCOME BEFORE CUMULATIVE ADJUSTMENT*  $   454.4   $   473.3   $   376.5   $   326.4   $   232.6   $   247.5
NET INCOME                                    454.4       473.3       376.5       318.2       232.6       247.5
- ---------------------------------------------------------------------------------------------------------------
COMMON STOCK DATA
Earnings per share before cumulative
 adjustment*                              $    3.64   $    3.73   $    2.97   $    2.55   $    1.79   $    1.90
Earnings per share                             3.64        3.73        2.97        2.49        1.79        1.90
Diluted earnings per share before
 cumulative adjustment*                        3.54        3.62        2.89        2.48        1.77        1.85
Diluted earnings per share                     3.54        3.62        2.89        2.42        1.77        1.85
Cash dividends declared per share              1.63        1.30        1.05         .91         .88         .79
Year-end book value per share                 16.39       15.01       13.35       11.66       10.70        9.52
Closing price of common stock per share:
   High                                       48.01       47.98       40.45       37.25       29.06       45.19
   Low                                        41.59       36.14       30.05       27.38       16.06       27.56
   Year-end                                   43.11       44.10       35.94       36.26       28.94       28.50
Dividends per share/year-end closing
 price                                          3.8%        2.9%        2.9%        2.5%        3.0%        2.8%
Dividends per share/diluted earnings per
 share                                         46.0        35.9        36.3        36.7        49.7        42.7
Price/earnings ratio                           12.2X       12.2x       12.4x       15.0x       16.3x       15.4x
Market capitalization                     $ 5,368.0   $ 5,552.0   $ 4,553.9   $ 4,597.0   $ 3,744.7   $ 3,715.1
Average shares (thousands)                  124,731     126,765     126,714     127,777     129,865     130,573
Period-end shares outstanding
 (thousands)                                123,532     124,834     125,600     125,865     128,745     129,878
Volume of shares traded (thousands)         173,177     176,528     139,946     110,154      99,469      96,207
- -----------------------------------------------------------------------------------------------------------------
SELECTED AVERAGE BALANCES
Total assets                              $27,305.8   $25,133.6   $20,704.0   $19,227.2   $19,325.3   $18,625.3
Total loans**                              15,384.6    12,656.3    10,634.5    10,104.3     9,932.0     8,818.8
Investment securities                       2,449.1     2,544.9     2,466.4     2,595.3     2,862.7     2,702.7
Earning assets                             23,718.3    21,328.9    17,397.4    16,125.4    16,095.5    15,583.7
Deposits                                   17,635.5    16,111.6    13,674.8    12,540.6    12,932.0    12,409.6
Term borrowings                             2,248.0     1,342.9       685.5       521.5       384.3       371.1
Shareholders' equity                        1,905.5     1,800.4     1,568.3     1,401.3     1,276.6     1,186.8
- -----------------------------------------------------------------------------------------------------------------
SELECTED PERIOD-END BALANCES
Total assets                              $29,771.7   $24,506.7   $23,823.1   $20,621.6   $18,559.6   $18,378.0
Total loans**                              16,427.7    13,990.5    11,345.4    10,283.1    10,239.5     9,363.2
Investment securities                       2,681.0     2,470.4     2,700.3     2,525.9     2,839.0     3,101.3
Earning assets                             25,952.3    20,621.1    19,999.8    17,085.7    15,193.3    14,944.2
Deposits                                   19,782.2    15,871.3    16,126.5    13,854.6    12,308.0    11,488.2
Term borrowings                             2,616.4     1,726.8       929.7       550.4       409.7       358.7
Shareholders' equity                        2,041.0     1,890.3     1,691.2     1,477.8     1,384.2     1,241.5
- -----------------------------------------------------------------------------------------------------------------
SELECTED RATIOS
Return on average shareholders' equity
 before cumulative adjustment*                23.85%      26.29%      24.00%      23.29%      18.22%      20.86%
Return on average shareholders' equity        23.85       26.29       24.00       22.71       18.22       20.86
Return on average assets before
 cumulative adjustment*                        1.66        1.88        1.82        1.70        1.20        1.33
Return on average assets                       1.66        1.88        1.82        1.66        1.20        1.33
Net interest margin                            3.62        3.78        4.35        4.29        3.75        3.82
Allowance for loan losses to loans**            .96        1.15        1.27        1.46        1.36        1.44
Net charge-offs to average loans**              .27         .54         .93         .80         .62         .59
Average shareholders' equity to average
 assets                                        6.98        7.16        7.58        7.29        6.61        6.37
Average tangible equity to average
 tangible assets                               6.24        6.37        6.70        6.66        5.98        5.70
Average shareholders' equity to average
 net loans                                    12.52       14.41       14.96       14.07       13.04       13.67
- -----------------------------------------------------------------------------------------------------------------
RETURN TO SHAREHOLDERS
Stock appreciation                             (2.2)%      22.7%        (.9)%      25.3%        1.5%      (25.1)%
Dividend yield                                  3.7         3.6         2.9         3.1         3.1         2.1
Total return                                    1.5        26.3         2.0        28.4         4.6       (23.0)
- -----------------------------------------------------------------------------------------------------------------
</Table>

 * Cumulative adjustment reflects the effect of changes in accounting principles
related to derivatives.
** Net of unearned income.
See accompanying notes to consolidated financial statements.
Certain previously reported amounts have been reclassified to agree with current
presentation.

                                      2      First Horizon National Corporation





<Page>


                       FIRST HORIZON NATIONAL CORPORATION
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

GENERAL INFORMATION

First Horizon National Corporation (FHN) is a nationwide, financial services
institution founded in 1864. From a small community bank, FHN has grown to be
one of the top 30 largest bank holding companies in the United States in terms
of asset size and market capitalization.

Approximately 12,400 employees provide a broad array of financial services to
individual and business customers through hundreds of offices located in 47
states.

FHN has been recognized as one of the nation's best employers by AARP, Working
Mother, Business Week and Fortune magazines. FHN also was named one of the
nation's 100 best corporate citizens by Business Ethics magazine.

FHN provides a broad array of financial services to its customers through three
national business segments. The combined strengths of these businesses create an
extensive range of financial products and services. In addition, the corporate
segment provides essential support within the corporation.

In 2004 FHN adapted its segments to reflect the common activities and operations
of aggregated business segments across the various delivery channels. Prior
periods have been restated for comparability. The new segments are:

      Retail/Commercial Banking offers financial products and services,
      including traditional lending and deposit taking, to retail and commercial
      customers. Additionally, the retail/commercial bank provides investments,
      insurance, financial planning, trust services and asset management, credit
      card, cash management, merchant services, check clearing, and
      correspondent services. Retail/Commercial Banking now includes Equity
      Lending, and second-lien mortgage and construction loans originated by
      First Horizon Home Loans, which were previously in the mortgage segment,
      and correspondent services, which was previously in Capital Markets.

      Mortgage Banking helps provide home ownership through First Horizon Home
      Loans, which operates offices in more than 40 states and is one of the top
      15 mortgage servicers and top 20 originators of mortgage loans to
      consumers. This segment consists of core mortgage banking elements
      including originations and servicing and the associated ancillary revenues
      related to these businesses.

      Capital Markets provides a broad spectrum of financial services for the
      investment and banking communities through the integration of capital
      markets securities activities, research and investment banking.

      Corporate consists of unallocated corporate expenses, expense on certain
      subordinated debt issuances and certain preferred stock, bank-owned life
      insurance, unallocated interest income associated with excess capital,
      funds management and venture capital.

For the purpose of this management discussion and analysis (MD&A), earning
assets have been expressed as averages, and loans have been disclosed net of
unearned income. The following financial discussion should be read with the
accompanying consolidated financial statements and notes. A glossary is included
at the end of the MD&A to assist with terminology.

First Horizon National Corporation     3





<Page>


FORWARD-LOOKING STATEMENTS

Management's discussion and analysis may contain forward-looking statements with
respect to FHN's beliefs, plans, goals, expectations, and estimates.
Forward-looking statements are statements that are not a representation of
historical information but rather are related to future operations, strategies,
financial results or other developments. The words 'believe', 'expect',
'anticipate', 'intend', 'estimate', 'should', 'is likely', 'will', 'going
forward', and other expressions that indicate future events and trends identify
forward-looking statements. Forward-looking statements are necessarily based
upon estimates and assumptions that are inherently subject to significant
business, operational, economic and competitive uncertainties and contingencies,
many of which are beyond a company's control, and many of which, with respect to
future business decisions and actions (including acquisitions and divestitures),
are subject to change. Examples of uncertainties and contingencies include,
among other important factors, general and local economic and business
conditions; expectations of and actual timing and amount of interest rate
movements (which can have a significant impact on a financial services
institution); market and monetary fluctuations; inflation or deflation; the
financial condition of borrowers and other counterparties; competition within
and outside the financial services industry; geo-political developments
including possible terrorist activity; effectiveness of FHN's hedging practices;
technology; and new products and services in the industries in which FHN
operates. Other factors are those inherent in originating and servicing loans
including prepayment risks, pricing concessions, fluctuation in U.S. housing
prices, fluctuation of collateral values, and changes in customer profiles.
Additionally, the actions of the Securities and Exchange Commission (SEC), the
Financial Accounting Standards Board (FASB), the Office of the Comptroller of
the Currency (OCC), the Board of Governors of the Federal Reserve System, and
other regulators; regulatory and judicial proceedings and changes in laws and
regulations applicable to FHN; and FHN's success in executing its business plans
and strategies and managing the risks involved in the foregoing, could cause
actual results to differ. FHN assumes no obligation to update any
forward-looking statements that are made from time to time.

FINANCIAL SUMMARY

       Retail/Commercial Banking pre-tax earnings grew 68 percent to $412.6
       million

       Loans grew 22 percent and asset quality continued to improve

       Mortgage Banking origination revenue reflected a substantially lower
       level of industry-wide refinance activity

       Capital Markets' fixed revenues declined as the demand for fixed income
       securities lessened

       Corporate segment earnings improved due to securities gains and reduced
       discretionary spending

       Return on equity was 23.9 percent and return on assets was 1.66 percent

FHN's diverse business mix, while subject to short-term favorable and
unfavorable volatility in earnings, provides a balance that has produced at a
level consistent with high performing growth and maintained a return on equity
at industry-leading levels. The benefit of this diverse and balanced business
mix was evidenced through the execution of FHN's strategies in 2004's difficult
economic environment.

Generally, FHN's performance in 2004 was negatively impacted by the unfavorable
interest rate environment experienced during the second half of the year.
Mortgage banking and capital markets were unfavorably affected while
retail/commercial banking achieved substantial growth, rebalancing FHN's
business mix. In addition, the adoption of SAB No. 105, which prohibited the
inclusion of estimated servicing cash flows within the valuation of interest
rate lock commitments, lowered pre-tax earnings by $8.4 million and diluted
earnings per share by $0.04. FHN previously included a portion of
                                       4      First Horizon National Corporation





<Page>


the value of the associated servicing cash flows when recognizing loan
commitments at inception and throughout their lives. This impact was a one-time
accounting change and does not affect the ongoing economic value of this
business.

The performance of retail/commercial banking, which represented 62 percent of
pre-tax earnings for 2004 compared to 34 percent in 2003, was positively
impacted by national expansion strategies. These strategies focus on
cross-selling banking products to existing customers within FHN's national
markets. During 2004, FHN further expanded First Horizon Bank in northern
Virginia and plans to replicate this strategy in 2005 in two additional markets
- -Texas and Georgia. Retail/commercial banking continues to benefit from
cross-selling within the national customer base as an increasing number of
customers have purchased multiple financial services.

Retail/commercial banking benefited from strong growth in retail lending, which
was particularly successful across FHN's national footprint, and from an
improved market for commercial loan growth. Also favorably impacting
retail/commercial banking were improved asset quality, which resulted in a lower
provision, and reduced discretionary spending in 2004. Deposit growth, achieved
through strategies focused on convenient hours, free checking and targeted
financial center expansions positively impacted retail/commercial banking's
performance.

Following a record year in 2003, capital markets experienced lower fixed income
securities sales in 2004 due to uncertainties within the investment community
regarding interest rates and other economic factors. However, the 2005
acquisition of the fixed income division of Spear, Leeds & Kellogg (SLK) will
provide an enhanced sales force, product offerings and execution capabilities
for FTN Financial and is expected to be accretive to FHN's earnings per share
during 2005.

Mortgage banking also felt negative effects from the interest rate environment
during 2004 as origination revenue declined due to a sharp drop in refinancings
from 2003's record levels and from lower margins on loans sold due to
competitive pricing pressures. However, net servicing revenues improved as the
servicing portfolio grew 26 percent and refinance activity declined.

Earnings for 2004 were $454.4 million, or $3.54 diluted earnings per share. This
compares to 2003 earnings of $473.3 million, or $3.62 diluted earnings per
share. Return on average shareholders' equity and return on average assets for
2004 were 23.9 percent and 1.66 percent, respectively, and were 26.3 percent and
1.88 percent in 2003. Total assets were $29.8 billion and shareholders' equity
was $2.0 billion on December 31, 2004, compared to $24.5 billion and $1.9
billion, respectively, on December 31, 2003.

BUSINESS LINE REVIEW

RETAIL/COMMERCIAL BANKING

Pre-tax earnings grew from $245.6 million to $412.6 million, or 68 percent over
2003. This growth resulted from national expansion initiatives, improved asset
quality, fee income growth and efficiency improvements. Total loan growth of
21 percent consisted of 30 percent growth in retail loans and 12 percent growth
in commercial loans. Retail loan growth primarily came from leveraging FHN's
national platform and commercial loan growth resulted from the national
expansion of single-family residential construction lending and improvements in
general economic conditions. Deposit account balances grew 3 percent compared to
2003; however, that growth was negatively impacted by the divestiture of First
National Bank of Springdale (Springdale), which had total deposits of
approximately $300 million in 2003. As a result of this product growth, net
interest income related to retail/commercial banking activities grew 17 percent
over 2003.

First Horizon National Corporation     5





<Page>


Noninterest income grew 9 percent to $483.1 million and represented 41 percent
of revenues. Contributing to this growth were net gains of $23.1 million in 2004
from the securitization of home equity lines of credit (HELOC) and second-lien
mortgages as FHN continues to utilize securitizations to manage liquidity and
fund new loan growth. Merchant processing fees grew 30 percent due to
transaction growth from new and existing clients. Included in 2004's performance
are $7.0 million of divestiture gains compared to $22.5 million of divestiture
gains in 2003 as FHN continues to divest non-strategic activities.

Net charge-offs fell to 27 basis points in 2004 from 54 basis points in 2003,
reflecting the reduced risk in the loan portfolio due to a change in the loan
mix and further economic recovery, which resulted in a $36.7 million reduction
in provision for loan losses. Noninterest expense increased $12.0 million
primarily due to development in the national markets including equity lending,
single-family residential construction lending and expansion in Middle Tennessee
and Northern Virginia. The efficiency ratio for retail/commercial banking has
consistently shown improvement over the last five quarters as discretionary
spending has been reduced and 2003's investments and operational improvements
continue to produce returns.

MORTGAGE BANKING

Pre-tax earnings decreased from $387.0 million in 2003 to $180.1 million in
2004, primarily driven by declining originations as refinancing activity fell
and competitive pricing pressures increased. Partially offsetting the decline in
originations was improvement in servicing profitability due to reduced
impairment expense and growth in the servicing portfolio coupled with a more
efficient servicing operation.

Mortgage origination volume fell $16.6 billion, or 35 percent to $30.5 billion,
as refinancing volume declined from 72 percent of total originations in 2003 to
45 percent in 2004. In addition, loans delivered during the period decreased by
$20.2 billion. This decrease, combined with other market factors, reduced
origination revenue by approximately $180 million. Additionally, margins on
loans sold decreased as competitive pressures in the market unfavorably impacted
origination revenue by approximately $82 million. Overall, origination revenues
decreased $262.4 million. Although total origination volumes were down, the
large reduction in refinancings was partially offset by improved home purchase
originations. Home purchase originations increased 26 percent as the focus of
the sales force shifted from refinance to purchase business and growth in the
sales force continued.

Net servicing revenues improved $75.6 million from $8.2 million in 2003 to $83.8
million in 2004. Total fees associated with mortgage servicing increased
23 percent to $230.4 million due to growth in the servicing portfolio and the
favorable impact of lower prepayment activity. The mortgage-servicing portfolio
(which includes servicing for ourselves and others) was $86.6 billion on
December 31, 2004, an increase of 26 percent from $68.9 billion on December 31,
2003. This increase includes approximately $11 billion of loans for which the
servicing rights were acquired in 2004. MSR net hedge gains decreased
58 percent to $47.9 million from $115.1 million; however, MSR impairment
decreased $121.3 million, triggered by the impact that rising interest rates had
on mortgage prepayments in the servicing portfolio.

Noninterest expense improved $27.8 million reflecting the overall decline in
activity levels. Additionally, as a result of reduced refinancing activity and
improvements in processes and technology, productivity improved resulting in a
16 percent reduction of servicing costs per loan compared to year-end 2003.

CAPITAL MARKETS

Pre-tax earnings declined from $154.6 million in 2003 to $83.2 million in 2004
primarily due to a reduction in fixed income securities sales, net of a related
decline in commissions and incentives.
                                       6      First Horizon National Corporation





<Page>


Significant uncertainties within the investment community regarding interest
rates and other economic factors have caused fixed income investors to delay
their purchases. In addition, 2003 was favorably impacted by higher cash flows
from the prepayments of mortgage-backed products and agency calls. As a result,
revenues from fixed income sales to depository and non-depository investors fell
$133.6 million. Revenues from other fee sources include fee income from
activities such as investment banking, equity research, portfolio advisory and
the sale of various financial products. These revenues decreased 16 percent from
2003's revenues primarily as a result of lower revenue in structured finance
transactions.

Noninterest expense decreased 24 percent or $95.9 million, primarily due to
lower personnel expense, reflecting the decline in commissions and incentives.

CORPORATE

The Corporate segment improved from a $68.2 million pre-tax loss in 2003 to a
$9.1 million pre-tax loss in 2004. Reduced discretionary spending helped lower
expenses by $47.6 million to $43.8 million. Net security gains for 2004 include
$18.4 million of gains from sales of investment securities compared to net
security losses of $6.9 million in 2003. Net gains from equity investments of
$5.3 million were realized in 2004 primarily due to the liquidation of a holding
company investment. This compares to net gains of $8.5 million in 2003 primarily
resulting from the sale of a venture capital investment. In addition, a loss of
$3.9 million was recognized in 2004 related to other-than-temporary impairment
of an investment in Freddie Mac equity securities. Net interest income decreased
$9.3 million since 2003 as a result of the temporary reduction in the investment
portfolio, the paydown of REMIC securities in 2003, and a decline in the
earnings credit on allocated capital.

INCOME STATEMENTS ANALYSIS - 2004 COMPARED TO 2003

Total revenue decreased 10 percent to $2,219.4 million from $2,473.4 million in
2003, with a 6 percent increase in net interest income and an 18 percent
decrease in noninterest income. Paralleling the decrease in total revenue,
noninterest expense decreased 10 percent to $1,504.3 million from $1,667.7
million in 2003.

NET INTEREST INCOME

During 2004 net interest income increased 6 percent to $856.3 million from
$805.8 million in 2003. Net interest income was positively impacted by growth in
the retail and commercial lending portfolios, as loans now comprise 65 percent
of the earning asset base compared to 59 percent in 2003. Some of this positive
impact was offset by the divestiture of Springdale on December 31, 2003, which
contributed $10.5 million to net interest income in 2003. In addition, the
adoption of SFAS No. 150 on July 1, 2003, resulted in FHN classifying its
mandatorily redeemable preferred stock of subsidiary to term borrowings. As
required by SFAS No. 150, the distributions on these instruments have been
classified as interest expense on a prospective basis resulting in increased
interest expense in 2004. The December 31, 2003, adoption of FIN 46 which
required the deconsolidation of First Tennessee Capital I (see
Note 11 -- Guaranteed Preferred Beneficial Interests in First Horizon's Junior
Subordinated Debentures) and consequently the guaranteed preferred securities
also had a negative impact on net interest income in 2004, as FHN's junior
subordinated debentures are no longer eliminated and the related expense is also
no longer eliminated in consolidation and is classified as interest expense in
2004. The combined impact of adopting these two standards on a prospective basis
was to increase interest expense by $10.4 million in 2004. An increase in
funding costs as noninterest-bearing deposits decreased 9 percent, primarily due
to lower escrow balances in mortgage banking also had a negative impact on net
interest income in 2004.

First Horizon National Corporation     7





<Page>


The net interest margin was 3.62 percent for 2004 compared to 3.78 percent for
2003. The net interest margin compressed 16 basis points as total funding costs
increased 11 basis points including the impact of the previously mentioned
accounting changes and the yield on average earning assets decreased two basis
points. The lower yield on earning assets reflects the repricing of assets to
lower yields that occurred throughout 2003 as accelerated prepayments were
reinvested at lower rates. Much of this negative impact began to diminish in the
latter part of 2004 as rates began to rise and the yield on loans improved due
to the change in the mix of the loan portfolio to an increased percentage of
floating rate products that also occurred during 2003.

The activity levels and related funding for FHN's mortgage production and
servicing and capital markets activities affect the margin. These activities
typically produce different margins than traditional banking activities.
Mortgage production and servicing activities can affect the overall margin based
on a number of factors, including the size of the mortgage warehouse, the time
it takes to deliver loans into the secondary market, the amount of escrow
balances, and the level of mortgage servicing rights (MSR). Capital markets
activities tend to compress the margin because of its strategy to reduce market
risk by hedging its inventory in the cash markets, which reduces the term and
accordingly the interest income earned on these positions. As a result, FHN's
consolidated margin cannot be readily compared to that of other bank holding
companies. Table 1 details the computation of the net interest margin for FHN
for the last three years.

TABLE 1 - NET INTEREST MARGIN

<Table>
<Caption>
                                                              2004   2003   2002
- ---------------------------------------------------------------------------------
<S>                                                           <C>    <C>    <C>
CONSOLIDATED YIELDS AND RATES:
    Investment securities                                     4.28%  4.40%  5.83%
    Loans, net of unearned income                             5.04   5.20   6.27
    Other earning assets                                      4.90   4.65   5.43
- ---------------------------------------------------------------------------------
Yields on earning assets                                      4.92   4.94   6.00
- ---------------------------------------------------------------------------------
    Interest-bearing core deposits                            1.39   1.38   1.91
    Certificates of deposit $100,000 and more                 1.57   1.34   2.08
    Federal funds purchased and securities sold under
      agreements to repurchase                                1.22   .99    1.45
    Commercial paper and other short-term borrowings          3.69   3.82   4.13
    Term borrowings                                           2.24   2.64   4.17
- ---------------------------------------------------------------------------------
Rates paid on interest-bearing liabilities                    1.59   1.48   2.05
- ---------------------------------------------------------------------------------
NET INTEREST SPREAD                                           3.33   3.46   3.95
    Effect of interest-free sources                           .29    .32     .40
- ---------------------------------------------------------------------------------
FHN - NIM                                                   3.62%  3.78%  4.35%
=================================================================================
</Table>

Certain previously reported amounts have been reclassified to agree with current
presentation.

In the near-term, a modest compression of the net interest margin is expected as
an increase in short-term rates will negatively impact the spread on the
mortgage warehouse. In addition, the compression of the margin attributable to
capital markets activities will increase due to the acquisition of SLK. Over the
long term, FHN's strategies to manage the interest rate sensitivity of the
balance sheet position are designed to allow the net interest margin to improve
in a higher interest rate environment.

                                       8      First Horizon National Corporation





<Page>


Table 2 shows how the changes in yields or rates and average balances compared
to the prior year affected net interest income.

TABLE 2 - ANALYSIS OF CHANGES IN NET INTEREST INCOME

<Table>
<Caption>
                                         2004 Compared to 2003             2003 Compared to 2002
                                      Increase/(Decrease) Due to*       Increase/(Decrease) Due to*
(Fully taxable equivalent)           ------------------------------   --------------------------------
(Dollars in thousands)                Rate**    Volume**    Total      Rate**     Volume**     Total
- ------------------------------------------------------------------------------------------------------
<S>                                  <C>        <C>        <C>        <C>         <C>        <C>
INTEREST INCOME - FTE:
Loans                                $(22,647)  $139,657   $117,010   $(123,854)  $115,334   $ (8,520)
Investment securities:
 U.S. Treasury                             22         54         76        (687)      (272)      (959)
 U.S. government agencies               3,006      3,886      6,892     (33,354)    15,190    (18,164)
 States and municipalities                (63)      (739)      (802)       (163)      (876)    (1,039)
 Other                                 (5,230)    (8,084)   (13,314)     (1,095)   (10,635)   (11,730)
- -----------------------------------                        --------                          ---------
   Total investment securities         (3,165)    (3,984)    (7,148)    (36,339)     4,447    (31,892)
- -----------------------------------                        --------                          ---------
Other earning assets:
 Loans held for sale                   10,240    (12,500)    (2,260)    (30,385)    75,438      45,053
 Investment in bank time deposits           5         71         76         (21)        (2)       (23)
 Federal funds sold and securities
   purchased under agreements to
   resell                               2,162        541      2,703      (3,020)     2,515       (505)
 Mortgage banking trading
   securities                           1,818      7,922      9,740       1,965      2,413       4,378
 Capital markets securities
   inventory                           (1,800)    (5,038)    (6,838)     (3,849)     6,288       2,439
- -----------------------------------                        --------                          ---------
   Total other earning assets          14,656    (11,235)     3,421     (37,362)    88,704      51,342
- -----------------------------------                        --------                          ---------
Total earning assets/total interest
 income - FTE                          (7,145)   120,428   $113,283    (201,607)   212,537   $  10,930
- -------------------------------------------------------------------   --------------------------------
INTEREST EXPENSE:
Interest-bearing deposits:
 Savings                             $   (402)  $    (32)  $   (434)  $  (1,379)  $     24   $ (1,355)
 Checking interest and money market        54      1,224      1,278     (15,353)     1,036    (14,317)
 Certificates of deposit under
   $100,000 and other time                291      2,630      2,921     (11,589)    (2,526)   (14,115)
 Certificates of deposit
   $100,000 and more                   12,972     25,696     38,668     (33,191)    22,683    (10,508)
- -----------------------------------                        --------                          ---------
   Total interest-bearing deposits     13,723     28,710     42,433     (64,502)    24,207    (40,295)
- -----------------------------------                        --------                          ---------
 Federal funds purchased and
   securities sold under agreements
   to repurchase                        8,445       (274)     8,171     (15,966)     7,412     (8,554)
 Commercial paper and other
   short-term borrowings                 (878)    (1,666)    (2,544)     (1,748)     4,776       3,028
 Term borrowings                       (6,146)    20,991     14,845     (13,304)    20,130       6,826
- -----------------------------------                        --------                          ---------
Total interest-bearing
 liabilities/total interest expense    18,827     44,078   $ 62,905     (88,251)    49,256   $(38,995)
- -------------------------------------------------------------------   --------------------------------
Net interest income - FTE                                  $ 50,378                          $  49,925
======================================================================================================
</Table>

 * The changes in interest due to both rate and volume have been allocated to
   change due to rate and change due to volume in proportion to the absolute
   amounts of the changes in each.
** Variances are computed on a line-by-line basis and are non-additive.
Certain previously reported amounts have been reclassified to agree with current
presentation.

First Horizon National Corporation     9





<Page>


NONINTEREST INCOME

Noninterest income provides the majority of FHN's revenue and contributed 61
percent to total revenue in 2004 compared with 67 percent in 2003. Noninterest
income decreased $304.5 million due to declines of $204.7 million in mortgage
banking and $162.4 million in capital markets, while all other categories of
noninterest income increased $62.6 million primarily due to growth in merchant
processing revenues and gains from asset securitizations, which is comprised of
the securitization of HELOC and second lien mortgages, included in all other
income. Table 3 provides six years of detailed information concerning FHN's
noninterest income. The following discussion provides additional information on
various line items reported in the table.

TABLE 3 - ANALYSIS OF NONINTEREST INCOME

<Table>
<Caption>
                                                                                                                Compound
                                                                                                                 Annual
                                                                                                                 Growth
                                                                                                                Rates (%)
                                                                                                              -------------
(Dollars in thousands)                 2004         2003         2002         2001        2000       1999     04/03   04/99
- ---------------------------------------------------------------------------------------------------------------------------
<S>                                 <C>          <C>          <C>          <C>          <C>        <C>        <C>     <C>
NONINTEREST INCOME:
 Mortgage banking                   $  444,758   $  649,496   $  436,706   $  285,032   $122,454   $298,211   31.5 -   8.3 +
 Capital markets                       376,558      538,919      448,016      344,278    118,709    126,900   30.1 -  24.3 +
 Deposit transactions and cash
 management                            148,514      146,701      143,315      133,631    116,080    106,240    1.2 +   6.9 +
 Merchant processing                    75,086       57,609       48,403       45,426     48,232     49,711   30.3 +   8.6 +
 Insurance commissions                  56,109       57,811       50,446       16,844     12,203     10,912    2.9 -  38.7 +
 Trust services and investment
 management                             47,274       45,873       48,369       56,705     65,817     59,807    3.1 +   4.6 -
 Gains on divestitures                   7,000       22,498        4,550       80,357    157,635      4,246     NM      NM
 Equity securities gains/(losses),
 net                                     2,040        8,491       (9,435)      (3,290)       754      2,313     NM      NM
 Debt securities gains/(losses),
 net                                    18,708       (6,113)         255       (1,041)    (4,961)       (56)    NM      NM
 All other income:
  Cardholder fees                       25,075       22,698       20,145       20,137     29,666     25,579   10.5 +    .4 -
  Asset securitizations                 23,115            -            -            -          -          -     NM      NM
  Other service charges                 19,709       19,810       21,204       24,932     23,199     17,430     .5 -   2.5 +
  Remittance processing                 19,515       23,666       26,016       22,820     24,314     16,683   17.5 -   3.2 +
  Check clearing fees                   10,052       11,839       13,180       11,615     11,129     11,143   15.1 -   2.0 -
  Other                                 89,673       68,286       60,765       57,575     71,866     59,425   31.4 +   8.6 +
- -----------------------------------------------------------------------------------------------------------
Total other income                     187,139      146,299      141,310      137,079    160,174    130,260   27.9 +   7.5 +
- -----------------------------------------------------------------------------------------------------------
Total noninterest income            $1,363,186   $1,667,584   $1,311,935   $1,095,021   $797,097   $788,544   18.3 -  11.6 +
===========================================================================================================
</Table>

Certain previously reported amounts have been reclassified to agree with current
presentation.
NM - Due to the variable nature of these items the growth rate is considered to
be not meaningful.

MORTGAGE BANKING

First Horizon Home Loans, an indirect subsidiary of FHN, offers residential
mortgage banking products and services to customers, which consist primarily of
the origination or purchase of single-family residential mortgage loans for sale
to secondary market investors and the subsequent servicing of those loans. First
Horizon Home Loans originates mortgage loans through its retail and wholesale
operations and also purchases mortgage loans from third-party mortgage bankers
(correspondent brokers). Table 4 provides a summary of First Horizon Home Loans'
production/origination of mortgage loans during 2004, 2003 and 2002.

                                       10     First Horizon National Corporation





<Page>


TABLE 4 - PRODUCTION/ORIGINATION OF MORTGAGE LOANS

<Table>
<Caption>
                                                              2004           2003           2002
- ------------------------------------------------------------------------------------------------
<S>                                                            <C>            <C>            <C>
Retail channel                                                 57%            56%            57%
Wholesale channel                                              36             35             33
Correspondent brokers                                           7              9             10
- ------------------------------------------------------------------------------------------------
</Table>

Origination income includes origination fees, net of costs, gains or losses
recognized on loans sold including the capitalized net present value of the MSR,
and the value recognized on loans in process. Origination fees, net of costs
(including incentives and other direct costs), are deferred and included in the
basis of the loans in calculating gains and losses upon sale. Gains or losses
from the sale of loans are recognized at the time a mortgage loan is sold into
the secondary market. A portion of the gain or loss is recognized at the time an
interest rate lock commitment is made to the customer. In second quarter 2004,
FHN adopted SAB No. 105, which prohibited the inclusion of estimated servicing
cash flows within the valuation of interest rate lock commitments under SFAS No.
133. Previously, FHN included a portion of the value of the associated servicing
cash flows when recognizing loan commitments at inception and throughout their
lives. The adoption of SAB No. 105, which lowered earnings by $8.4 million, was
a one-time change and does not affect the ongoing economic value of this
business.

Servicing income includes servicing fees, MSR net hedge gains/(losses), which
reflect the effects of hedging MSR including servicing rights net value changes,
amortization and impairment of MSR, and gains/(losses) related to market value
adjustments on retained interests classified as mortgage trading securities,
primarily interest-only strips, and associated hedges. First Horizon Home Loans
employs hedging strategies intended to counter changes in the value of MSR and
other retained interests due to changing interest rate environments (see
Critical Accounting Policies). Other income includes income from the GNMA
repurchase program, gains from a strategic risk management portfolio sale, and
other miscellaneous items. As shown in Table 5, total mortgage banking
noninterest income decreased 32 percent in 2004.

TABLE 5 - MORTGAGE BANKING

<Table>
<Caption>
                                                                                           Compound Annual
                                                                                          Growth Rates (%)
                                                                                        ---------------------
(Dollars and volume in millions)                  2004         2003         2002         04/03         04/02
- -------------------------------------------------------------------------------------------------------------
<S>                                              <C>          <C>          <C>          <C>           <C>
NONINTEREST INCOME:
 Origination income - mortgage banking           $ 339.8      $ 602.2      $ 412.9        43.6 -        9.3 -
 Origination income - residential construction
   lending                                           1.7           .6           .8       187.0 +       45.8 +
- ----------------------------------------------------------------------------------
     Total origination income                      341.5        602.8        413.7        43.3 -        9.1 -
- ----------------------------------------------------------------------------------
 Servicing income                                   83.8          8.2        (10.2)      923.7 +         NM
 Other                                              19.5         38.5         33.2        49.5 -       23.4 -
- ----------------------------------------------------------------------------------
     Total mortgage banking noninterest income   $ 444.8      $ 649.5      $ 436.7        31.5 -         .9 +
==================================================================================
 Refinance originations - first lien             $13,791      $33,811      $23,457        59.2 -       23.3 -
 New loan originations - first lien               16,674       13,280        8,503        25.6 +       40.0 +
- ----------------------------------------------------------------------------------
     Mortgage loan originations                  $30,465      $47,091      $31,960        35.3 -        2.4 -
- ----------------------------------------------------------------------------------
 Servicing portfolio                             $86,587      $68,914      $55,993        25.6 +       24.4 +
- -------------------------------------------------------------------------------------------------------------
</Table>

Certain previously reported amounts have been reclassified to agree with current
presentation.

In 2004, origination income was $341.5 million compared to $602.8 million in
2003, primarily reflecting the decrease in refinance origination volume and
lower margins related to competitive pricing pressures and a change in the
relative mix of originations from a higher percentage of fixed rate to a

First Horizon National Corporation     11





<Page>


higher percentage of adjustable-rate mortgages. Total mortgage first-lien
originations decreased 35 percent to $30.5 billion compared to $47.1 billion in
2003. Refinance activity decreased to 45 percent of total originations in 2004
compared to 72 percent in 2003. Given the industry-wide decline in refinance
volume, the decrease in production volume was expected. However, home-purchase
related originations grew 26 percent in 2004 as the focus of the sales force
shifted from refinance to purchase business and growth in the sales force
continued. Loans securitized and sold into the secondary market decreased 41
percent to $29.3 billion as origination volume decreased.

The mortgage-servicing portfolio was $86.6 billion on December 31, 2004,
compared to $68.9 billion on December 31, 2003. The portfolio on December 31,
2004, includes approximately $11 billion of loans for which the servicing rights
were acquired in 2004. Servicing fees increased $43.6 million or 23 percent
primarily due to growth in the servicing portfolio. Amortization expense
increased $20.4 million or 15 percent also as a result of the growth in the
servicing portfolio. Total servicing income increased $75.6 million due to the
positive impact of the servicing fee growth combined with a decline in
impairment costs of $121.3 million, which resulted from the impact that rising
interest rates had on mortgage prepayments in the servicing portfolio. These
positive impacts were partially offset by the higher amortization costs and
lower net hedge gains, which fell $67.2 million reflecting the impacts of
interest rate volatility, the flattening of the yield curve and higher costs
associated with increased use of option-based hedge instruments.

Other mortgage income decreased 50 percent to $19.5 million for 2004 compared
with $38.5 million in 2003 primarily due to a decline in noninterest income from
the GNMA repurchase program under which First Horizon Home Loans repurchases
delinquent loans to reduce future foreclosure costs. Much of this decline
resulted from a reclassification at the end of 2003 of loans repurchased prior
to foreclosure to loans held for sale from other assets and the associated yield
on those assets being included in net interest income in 2004.

Going forward, revenue from refinance loan originations will depend on mortgage
interest rates. Over time, an increase in rates should reduce origination fees
and profit from the sale of loans, but should also reduce MSR impairment losses,
while a decrease in rates should increase this net revenue. Home-purchase
related originations should reflect the relative strength or weakness of the
economy and the growth of the sales force. Actual results could differ because
of several factors, including those presented in the Forward-Looking Statements
section of the MD&A discussion.

CAPITAL MARKETS

Capital markets noninterest income, the major component of revenue in the
Capital Markets segment, is primarily generated from the purchase and sale of
securities as both principal and agent, and from investment banking, portfolio
advisory and research services. Inventory positions are limited to the
procurement of securities solely for distribution to customers by the sales
staff. Inventory is hedged to protect against movements in fair value due to
changes in interest rates.

Capital markets noninterest income decreased 30 percent to $376.5 million from
$538.9 million in 2003, primarily due to a reduction in fixed income securities
sales. Uncertainties within the investment community regarding interest rates
and other economic factors have caused fixed income investors to delay their
purchases. In addition to this impact, 2003 was favorably impacted by higher
cash flows from prepayments of mortgage-backed products and agency calls. As a
result of these impacts, revenues from fixed income sales to depository and
non-depository investors fell $133.6 million. Revenues from other fee sources
include fee income from activities such as investment banking, equity research,
portfolio advisory, and the sale of various financial products. These revenues
decreased 17 percent from 2003, primarily as a result of lower revenue in
structured finance transactions.

Going forward, capital markets noninterest income is expected to be positively
impacted by the acquisition of SLK and further development of the investment
banking business, while demand from the traditional customer base will fluctuate
based upon interest rate expectations.

                                       12     First Horizon National Corporation





<Page>


TABLE 6 - CAPITAL MARKETS

<Table>
<Caption>
                                                                                            Compound Annual
                                                                                            Growth Rates (%)
                                                                                        ------------------------
(Dollars in millions)                       2004           2003           2002           04/03            04/02
- ----------------------------------------------------------------------------------------------------------------
<S>                                        <C>            <C>            <C>            <C>              <C>
NONINTEREST INCOME:
 Fixed income  -  depository               $134.3         $228.4         $182.2           41.2 -          14.1 -
 Fixed income  -  non-depository             98.6          138.1          119.9           28.6 -           9.3 -
 Other products and services                143.6          172.4          145.9           16.7 -            .8 -
- -------------------------------------------------------------------------------
     Total capital markets noninterest
       income                              $376.5         $538.9         $448.0           30.1 -           8.3 -
===============================================================================
</Table>

DEPOSIT TRANSACTIONS AND CASH MANAGEMENT

Deposit transactions include services related to retail deposit products (such
as service charges on checking accounts), cash management products and services
such as electronic transaction processing (automated clearing house and
Electronic Data Interchange), account reconciliation services, cash vault
services, lockbox processing, and information reporting to large corporate
clients. Noninterest income from deposit transactions and cash management was
$148.5 million in 2004 compared to $146.7 million in 2003.

MERCHANT PROCESSING

Merchant processing involves converting transactions from plastic media such as
debit cards, credit cards, purchase cards, and private label credit cards into
cash for merchants that sell goods and services to consumers and businesses. Fee
income from merchant processing increased 30 percent in 2004 to $75.1 million
from $57.6 million in 2003, as new and existing clients experienced increases in
transaction activity.

INSURANCE COMMISSIONS

Insurance commissions are derived from the sale of insurance products and
annuities, including acting as an independent agent to provide commercial and
personal property and casualty, life, long-term care, and disability insurance.
Noninterest income from insurance commissions was $56.1 million in 2004 compared
to $57.8 million in 2003.

TRUST SERVICES AND INVESTMENT MANAGEMENT

Trust services and investment management fees include investment management,
personal trust, employee benefits, and custodial trust services and are
influenced by equity and fixed income market activity. Noninterest income from
trust services and investment management was $47.3 million in 2004 compared to
$45.9 million in 2003.

GAINS ON DIVESTITURES

Gains from divestitures totaled $7.0 million in 2004 and $22.5 million in 2003.
Divestiture gains in 2004 resulted primarily from the sale of certain merchant
relationships. The gain in 2003 reflects FHN's divestiture of substantially all
of the assets and liabilities of its wholly owned subsidiary, Springdale, as
well as the sale of certain merchant relationships referred by selected agent
banks within the merchant portfolio. See Note 2  - Acquisitions/Divestitures for
additional information.

SECURITIES GAINS/(LOSSES)

In 2004 there were $20.7 million of net securities gains compared to $2.4
million in 2003. Net securities gains for 2004 include $18.7 million of gains
from sales of investment securities compared

First Horizon National Corporation     13





<Page>


to net losses of $6.1 million in 2003. In 2004, net securities gains from equity
investments of $2.0 million include the impact of a $3.9 million loss recognized
related to other-than-temporary impairment of an investment in Freddie Mac
equity securities and a gain of $5.5 million resulting from the liquidation of a
holding company investment. In 2003, net securities gains from equity
investments of $8.5 million primarily resulted from the sale of a venture
capital investment from FHN's wholly-owned venture capital subsidiary, Hickory
Venture Capital Corporation.

ALL OTHER INCOME

All other income increased 28 percent to $187.1 million in 2004 from $146.3
million in 2003. This growth was led by $23.1 million net gains from the
securitization of HELOC and second-lien mortgages as FHN continues to utilize
securitizations to manage liquidity and fund new loan growth. In 2003, net
losses of $5.4 million resulted from the sale of equity lending loans.

NONINTEREST EXPENSE

Total noninterest expense for 2004 decreased 10 percent to $1,504.3 million from
$1,667.7 million in 2003. Based on the strong earnings experienced in 2003,
noninterest expense included $85.4 million of discretionary spending on
performance enhancing initiatives. Table 8 provides detail by category for the
past six years with growth rates.

Personnel expense decreased 8 percent to $915.0 million from $995.6 million in
2003 primarily due to lower activity levels in capital markets in 2004,
reflecting lower commissions and incentives. Included in personnel expense is
the net periodic benefit cost for FHN's pension plan of $7.1 million in 2004, as
compared to $5.5 million in 2003. FHN anticipates, based on current conditions
that net periodic benefit cost for the Pension Plan will increase by $2.3
million in 2005 as a result of additional participants in the supplemental
executive retirement plan, normal growth in the qualified pension plan and a
decrease in assumed earnings on assets in the qualified plan.

The declines in advertising, legal and professional fees, charitable
contributions, and other expenses are all primarily related to discretionary
spending reductions in 2004. The decline in travel and entertainment, contract
employment and foreclosed real estate are primarily related to the lower
activity levels in mortgage banking in 2004. The adoption of SFAS No. 150 on
July 1, 2003, resulted in the expense associated with distributions on preferred
stock of a subsidiary being included in interest expense subsequent to adoption,
and the adoption of FIN 46 on December 31, 2003, resulted in the expense
associated with distributions on guaranteed preferred securities being included
in interest expense subsequent to adoption. Additional information related to
expenses by business line is provided in Table 7.

TABLE 7 - NONINTEREST EXPENSE COMPOSITION

<Table>
<Caption>
(Dollars in millions)                                           2004               2003               2002
- ------------------------------------------------------------------------------------------------------------
<S>                                                           <C>                <C>                <C>
Retail/Commercial Banking                                     $  721.2           $  709.2           $  651.3
Mortgage Banking                                                 438.4              466.2              344.8
Capital Markets                                                  300.9              396.8              326.8
Corporate                                                         43.8               95.5               94.3
- ------------------------------------------------------------------------------------------------------------
Total noninterest expense                                     $1,504.3           $1,667.7           $1,417.2
============================================================================================================
</Table>

Certain previously reported amounts have been reclassified to agree with current
presentation.

                                       14     First Horizon National Corporation





<Page>


TABLE 8 - ANALYSIS OF NONINTEREST EXPENSE

<Table>
<Caption>
                                                                                                             Compound Annual
                                                                                                             Growth Rates (%)
                                                                                                             ----------------
(Dollars in thousands)                2004         2003         2002         2001        2000       1999      04/03    04/99
- -----------------------------------------------------------------------------------------------------------------------------
<S>                                <C>          <C>          <C>          <C>          <C>        <C>        <C>      <C>
NONINTEREST EXPENSE:
 Employee compensation,
 incentives and benefits           $  914,947   $  995,609   $  830,672   $  670,934   $508,335   $488,759     8.1 -   13.4 +
 Occupancy                             89,402       83,583       76,669       69,069     80,453     73,052     7.0 +    4.1 +
 Equipment rentals, depreciation
 and maintenance                       72,695       68,973       68,736       74,106     68,230     57,807     5.4 +    4.7 +
 Operations services                   67,523       67,948       60,238       59,635     70,875     64,545      .6 -     .9 +
 Communications and courier            49,590       50,535       45,085       42,191     41,892     45,311     1.9 -    1.8 +
 Amortization of intangible
 assets                                 9,541        7,980        6,200       10,805     11,738     10,492    19.6 +    1.9 -
 All other expense:
  Advertising and public
   relations                           39,961       43,955       35,982       35,508     26,693     30,187     9.1 -    5.8 +
  Legal and professional fees          37,730       60,001       37,340       32,087     26,794     22,492    37.1 -   10.9 +
  Travel and entertainment             30,794       37,432       22,501       17,489     13,891     18,698    17.7 -   10.5 +
  Computer software                    28,906       28,828       26,140       25,107     19,205     15,410      .3 +   13.4 +
  Contract employment                  23,714       33,790       28,987       30,082     28,157     40,804    29.8 -   10.3 -
  Supplies                             17,591       18,783       15,145       13,765     16,411     19,087     6.3 -    1.6 -
  Fed service fees                      8,838        9,195        9,597        7,761      7,112      6,471     3.9 -    6.4 +
  Foreclosed real estate                5,834       13,137       21,479       25,452     16,080      6,585    55.6 -    2.4 -
  Deposit insurance premium             3,024        2,703        2,393        2,463      2,589      1,790    11.9 +   11.1 +
  Charitable contributions              1,497       13,370       48,337        1,745      1,188      1,335    88.8 -    2.3 +
  Distributions on guaranteed
   preferred securities                     -        8,070        8,070        8,070      8,070      8,070   100.0 -  100.0 -
  Distributions on preferred
   stock of subsidiary                      -        2,282        4,564        4,535      1,178          -   100.0 -    NM
  Other                               102,753      121,498       69,171       71,348     44,636     32,511    15.4 -   25.9 +
- ----------------------------------------------------------------------------------------------------------
Total other expense                   300,642      393,044      329,706      275,412    212,004    203,440    23.5 -    8.1 +
- ----------------------------------------------------------------------------------------------------------
Total noninterest expense          $1,504,340   $1,667,672   $1,417,306   $1,202,152   $993,527   $943,406     9.8 -    9.8 +
==========================================================================================================
</Table>

NM  -  not meaningful
Certain previously reported amounts have been reclassified to agree with current
presentation.

PROVISION FOR LOAN LOSSES

The provision for loan losses is the charge to earnings that management
determines to be necessary to maintain the allowance for loan losses at an
adequate level reflecting management's estimate of probable incurred losses in
the loan portfolio. An analytical model based on historical loss experience
adjusted for current events, trends and economic conditions is used by
management to assess the adequacy of the loan loss allowance and to determine
the amount of provision to be recognized. The provision for loan losses
decreased 44 percent in 2004 to $48.3 million from $86.7 million in 2003. The
improvement in 2004's provision is related to the positive shift in the mix of
the loan portfolio and the reduction in specific allocations related to large
commercial credits. The risk profile of the retail loan portfolio has continued
to improve as successful cross-sell efforts to mortgage banking customers have
shifted the mix of the portfolio to a greater concentration of loans to high
credit score borrowers, which require lower reserves. As the economic
environment strengthened, the risk profile of the commercial loan portfolio
improved as indicated by current lower levels of watch list and classified
loans.

First Horizon National Corporation     15





<Page>


INCOME TAXES

The effective tax rate for 2004 was 31.9 percent compared to 34.2 percent for
2003. Lower state taxes in 2004 contributed to the reduction in the effective
tax rate. In addition, the decline in the tax rate was affected by the sale of
Springdale in 2003 which increased taxes during 2003 as $4.9 million of tax
expense was recognized from the gain on the sale and an additional $4.9 million
of tax expense was recognized primarily due to the difference in the book value
and the tax basis of goodwill (a total of $9.8 million tax expense).
Springdale's assets were recorded at fair value for book purposes but not for
tax purposes when acquired by FHN in 1995.

INCOME STATEMENTS ANALYSIS - 2003 COMPARED TO 2002

Earnings in 2003 were $473.3 million, an increase of 26 percent from $376.5
million earned in 2002. Diluted earnings per common share increased 25 percent
to $3.62 in 2003 from $2.89 in 2002. Return on average assets was 1.88 percent
in 2003 compared with 1.82 percent in 2002, and return on average shareholders'
equity was 26.3 percent in 2003 compared with 24.0 percent in 2002.

During 2003 net interest income increased 7 percent to $805.8 million from
$755.6 million, reflecting a larger portfolio of mortgage warehouse loans, which
grew 46 percent on average to $4.4 billion from $3.0 billion in 2002. This
positive impact on net interest income was largely offset by compression in the
net interest margin resulting from the repricing of assets to lower yields as
liability rates became less sensitive to rate movements in a historically low
interest rate environment, and as the mix of the loan portfolio shifted to a
higher percentage of floating rate products. Investment yields declined as
accelerated prepayments of investments in mortgage-backed securities resulted in
increased amortization of premiums and the proceeds from the prepaid investments
were reinvested at lower rates. The consolidated net interest margin decreased
to 3.78 percent for 2003 compared with 4.35 percent for 2002. See Table 1 for a
detailed computation of the net interest margin for FHN.

Noninterest income increased 27 percent during 2003, to $1,667.6 million from
$1,311.9 million and contributed 67 percent to total revenue in 2003 compared to
63 percent in 2002. During 2003 mortgage banking noninterest income increased 49
percent to $649.5 million from $436.7 million, due to increased origination
volumes. This increased activity resulted in higher net fees from the mortgage
origination process which increased 46 percent to $602.8 million in 2003. While
growth in refinance activity produced increased origination fee income, it also
substantially increased actual and projected MSR prepayment speeds, which was
the primary reason for the $132.3 million, or 12 percent, increase in MSR
amortization expense, and a $158.3 million impairment loss in 2003 compared to a
$150.2 million loss in 2002. The decrease in fair value of MSR attributed to
declining interest rates was significantly offset by an expected increase in the
value of the derivative financial instruments used to hedge the change in fair
value of the hedged MSR. MSR net hedge gains were $115.2 million in 2003
compared to $100.8 million in 2002 (both years represent an increase in the
value of hedges offset by a decrease in the value of hedged MSR). See Table 5
for detail of mortgage banking noninterest income. In 2003 capital markets
noninterest income increased 20 percent to $538.9 million from $448.0 million.
This increase reflected continued growth and penetration into the targeted
institutional customer base through enhanced product and service lines.
Additionally, revenue was favorably impacted in 2003 by increased liquidity of
depository institution customers as well as a continued marketing focus on
developing capital markets' non-depository account base. During 2003 deposit
transactions and cash management fees increased 2 percent to $146.7 million from
$143.3 million primarily due to an increase in returned check charges. During
2003 insurance commissions increased 15 percent to $57.8 million from $50.4
million primarily due to Synaxis, a wholly owned insurance broker, which
experienced increased revenues from internal expansion and an acquisition.
Merchant processing fees increased 19 percent to $57.6 million from $48.4
million in 2002 primarily due to portfolio acquisitions. During 2003 total
noninterest income from trust services and investment management decreased 5
percent to $45.9 million from $48.4 million as difficult equity market
conditions negatively impacted results. Gains from divestitures totaled $22.5
million and $4.6 million in 2003 and 2002, respectively. The gains in 2003
reflect FHN's divestiture of substantially all of the

                                       16     First Horizon National Corporation





<Page>


assets and liabilities of Springdale and the sale of certain merchant
relationships. The gain in 2002 reflects First Horizon Money Centers' loan
portfolio sale and an adjustment to the gain recognized on the sale of Check
Solutions Company in 2001. In 2003 there were $2.4 million of net securities
gains compared with $9.2 million of net securities losses for 2002. In 2003 net
securities gains from equity investments of $8.5 million primarily resulted from
the sale of a venture capital investment from FHN's wholly-owned venture capital
subsidiary, Hickory Venture Capital Corporation, and net losses of $6.1 million
were related to sales of investment securities. In 2002 the losses were
primarily related to impairment of equity investments held by FHN's venture
capital subsidiaries. All other noninterest income increased 4 percent in 2003,
to $146.3 million from $141.3 million, with the growth being spread over several
categories.

Total noninterest expense for 2003 increased 18 percent to $1,667.7 million from
$1,417.2 million in 2002. Employee compensation, incentives and benefits
increased 20 percent to $995.6 million from $830.6 million in 2002 primarily due
to higher activity levels in capital markets and mortgage banking. Occupancy
expense increased 9 percent to $83.6 million compared to $76.7 million in 2002
primarily due to costs associated with the opening of new offices related to
increased origination volumes. Operations services increased 13 percent to $67.9
million from $60.2 million in 2002, primarily due to business expansion and
costs related to transitioning to a new information technology provider.
Communications and courier expense increased 12 percent to $50.5 million in 2003
from $45.1 million primarily due to the increased activity levels of mortgage
banking and capital markets. All other expense increased 19 percent to $393.1
million from $329.7 million in 2002. Contributing to this increase were
investments in initiatives focused on benefiting future performance, including
professional fees, debt restructuring and marketing programs. Also contributing
to the increase was a loss of $16.3 million related to the termination of a
lease arrangement with a single-purpose entity for First Horizon Home Loans'
main office headquarters, the growth in expense associated with higher activity
levels in First Horizon, an increase of $5.3 million related to insuring certain
real estate residential loans, and a $9.8 million contribution to First Horizon
Foundation, a non-profit entity dedicated to supporting charitable causes in the
diverse communities where FHN does business. Partially offsetting these
increases was a decline in foreclosure losses. In 2002 charitable contributions
included $45.0 million in contributions to First Horizon Foundation.

The provision for loan losses decreased 6 percent, to $86.7 million in 2003
compared with $92.2 million in 2002. The decline in provision would have been
greater except for the transfer of certain retail loans to held for sale which
increased 2003's provision. The improvement in 2003's provision is related to
the positive shift in the mix of the loan portfolio and improvement in specific
allocations related to large commercial credits.

STATEMENTS OF CONDITION REVIEW

On December 31, 2004, FHN reported total assets of $29.8 billion compared with
$24.5 billion at the end of 2003 and $23.8 billion at the end of 2002. Average
assets were $27.3 billion in 2004 compared with $25.1 billion in 2003 and $20.7
billion in 2002. In 2004 an increase in earning assets accounted for 110 percent
of the growth in average assets.

EARNING ASSETS

Earning assets primarily consist of loans, loans held for sale and investment
securities. During 2004, earning assets averaged $23.7 billion compared with
$21.3 billion and $17.4 billion for 2003 and 2002, respectively. Average earning
assets were 87 percent of total average assets in 2004, compared with 85 percent
and 84 percent in 2003 and 2002, respectively.

LOANS

Average loans increased 22 percent to $15.4 billion during 2004 as retail loans
grew 30 percent and commercial loans grew 12 percent. Average loans grew 19
percent to $12.7 billion during 2003. Average loans represented 65 percent of
average earning assets in 2004; 59 percent in 2003; and

First Horizon National Corporation     17





<Page>


61 percent in 2002. In 2004, FHN transferred approximately $1.6 billion of real
estate residential loans to available for sale as a result of management's
ongoing evaluation of alternative sources of funding, including securitizations,
as loan growth exceeded core deposit growth. On December 31, 2003, FHN sold
substantially all of the assets and liabilities of Springdale which had average
loans of approximately $175 million in 2003. In prior years, FHN securitized
real estate loans through a real estate mortgage investment conduit (REMIC) and
retained all of the securitized assets. The retained assets were classified on
the Consolidated Statements of Condition in 'Securities held to maturity'.
During 2003, FHN elected to repurchase all of the mortgage loans remaining in
the REMIC ($136.3 million at repurchase). Subsequent to the repurchase of the
mortgage loans, these assets are classified as retail real estate residential
loans. Additional loan information is provided in Table 9 and Note 4  -  Loans.

TABLE 9 - AVERAGE LOANS

<Table>
<Caption>
                                                         2004                            2003
                                             PERCENT    GROWTH               Percent    Growth                Percent
(Dollars in millions)              2004      OF TOTAL    RATE      2003      of Total    Rate       2002      of Total
- ----------------------------------------------------------------------------------------------------------------------
<S>                             <C>          <C>        <C>      <C>         <C>        <C>      <C>          <C>
Commercial:
 Commercial, financial and
   industrial                   $  4,845.6      31%      12.6%   $ 4,304.6      34%       8.0%   $  3,986.6      37%
 Real estate commercial              959.3       6       (9.2)     1,056.4       8        2.7       1,028.7      10
 Real estate construction            895.6       6       41.5        632.9       5       22.4         516.7       5
- -----------------------------------------------------            --------------------            ---------------------
Total commercial                   6,700.5      43       11.8      5,993.9      47        8.3       5,532.0      52
- -----------------------------------------------------            --------------------            ---------------------
Retail:
 Real estate residential           7,533.0      49       31.8      5,716.9      45       36.6       4,185.1      39
 Real estate construction            714.6       5       68.5        424.0       4       61.9         261.9       2
 Other retail                        186.3       1      (28.2)       259.5       2      (33.6)        390.7       4
 Credit card receivables             250.2       2       (4.5)       262.0       2       (1.1)        264.8       3
- -----------------------------------------------------            --------------------            ---------------------
Total retail                       8,684.1      57       30.3      6,662.4      53       30.6       5,102.5      48
- -----------------------------------------------------            --------------------            ---------------------
Total loans, net of unearned    $ 15,384.6     100%      21.6%   $12,656.3     100%      19.0%   $ 10,634.5     100%
=====================================================            ====================            =====================
</Table>

Commercial loans consist of commercial, financial and industrial; commercial
real estate; and commercial construction loans. Commercial, financial and
industrial loans continued as the single largest loan category within commercial
loans and represented 72 percent of the commercial loan portfolio in 2004, 2003
and 2002. Commercial, financial and industrial loans increased 13 percent, or
$541.0 million, in 2004 as general economic conditions improved. Commercial
construction loans grew 42 percent in 2004 or $262.7 million, after increasing
22 percent or $116.2 million in 2003. The increase in commercial construction
lending is primarily from growth in loans to single-family residential builders
made through First Horizon Home Loans, reflecting the strong demand for single-
family housing and expansion of the sales force and geographic reach. Commercial
real estate loans decreased 9 percent or $97.1 million primarily due to the
divestiture of Springdale. Additional commercial loan information is provided in
Table 10.

                                       18     First Horizon National Corporation





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TABLE 10 - CONTRACTUAL MATURITIES OF COMMERCIAL LOANS ON DECEMBER 31, 2004

<Table>
<Caption>
                                                                   After 1 Year
(Dollars in thousands)                            Within 1 Year   Within 5 Years   After 5 Years     Total
- -------------------------------------------------------------------------------------------------------------
<S>                                               <C>             <C>              <C>             <C>
Commercial, financial and industrial               $3,274,160       $2,072,353       $214,223      $5,560,736
Real estate commercial                                361,937          488,718        109,523         960,178
Real estate construction                              809,100          367,291         32,312       1,208,703
- -------------------------------------------------------------------------------------------------------------
Total commercial loans, net of unearned income     $4,445,197       $2,928,362       $356,058      $7,729,617
=============================================================================================================
For maturities over one year:
 Interest rates  -  floating                                        $1,729,898       $140,683      $1,870,581
 Interest rates  -  fixed                                            1,198,464        215,375       1,413,839
- -------------------------------------------------------------------------------------------------------------
Total                                                               $2,928,362       $356,058      $3,284,420
=============================================================================================================
</Table>

The retail loan portfolio consists of residential real estate (principally
secured by first and/or second liens on residential property), other retail
(automobile and other retail installment loans requiring periodic payments of
principal and interest), credit card, and retail construction loans. Residential
real estate loans accounted for 87 percent of the retail loan portfolio in 2004,
86 percent in 2003 and 82 percent in 2002. The residential real estate loan
portfolio grew 32 percent or $1.8 billion in 2004, and grew 37 percent or $1.5
billion in 2003, primarily due to growth in HELOC. The retail real estate
construction portfolio increased 69 percent or $290.6 million in 2004, after
growing 62 percent or $162.1 million in 2003. Retail real estate residential
construction loans are made to individuals for the purpose of constructing a
home where First Horizon Home Loans is committed to make the permanent mortgage.
The increase in these loans reflects the favorable housing environment and
expansion of the sales force and geographic reach. Other retail loans decreased
28 percent or $73.2 million in 2004, and decreased 34 percent or $131.2 million
in 2003 largely due to a decline in automobile lending.

Going forward, FHN expects loan growth to reflect the relative strength of the
economy and the continued success of the sales force and national expansion
efforts. FHN will continue to evaluate alternative sources of funding which may
include loan sales, securitizations, syndications, equity offerings and debt
offerings.

INVESTMENT SECURITIES

The investment portfolio of FHN consists principally of debt securities used as
a source of income, liquidity and collateral for repurchase agreements or public
fund deposits. Additionally, the investment portfolio is used as a tool to
manage risk from movements in interest rates. On December 31, 2004, the
investment portfolio totaled $2.7 billion. The investment portfolio is
classified into two categories: securities available for sale (AFS) and
securities held to maturity (HTM). Table 11 shows information pertaining to the
composition, yields and contractual maturities of the investment securities
portfolio.

First Horizon National Corporation     19





<Page>


TABLE 11 - CONTRACTUAL MATURITIES OF INVESTMENT SECURITIES ON DECEMBER 31, 2004
(AMORTIZED COST)

<Table>
<Caption>
                                                             After 1 Year      After 5 Years
                                          Within 1 Year     Within 5 Years    Within 10 Years      After 10 Years
                                         ---------------   ----------------   ---------------   ---------------------
(Dollars in thousands)                   Amount    Yield    Amount    Yield   Amount    Yield     Amount        Yield
- ---------------------------------------------------------------------------------------------------------------------
<S>                                      <C>       <C>     <C>        <C>     <C>       <C>     <C>             <C>
SECURITIES HELD TO MATURITY (HTM):
States and municipalities*               $    35   9.63%   $    406   7.66%   $     -      -%   $        -         -%
- ---------------------------------------------------------------------------------------------------------------------
Total                                    $    35   9.63%   $    406   7.66%   $     -      -%   $        -         -%
=====================================================================================================================
SECURITIES AVAILABLE FOR SALE (AFS):
Government agency issued MBS and CMO**   $    32   9.40%   $ 99,382   4.33%   $50,567   4.52%   $2,252,995      4.34%
U.S. Treasuries                           40,857   2.05         202   3.10        364   4.27             -         -
Other U.S. government agencies             1,000   6.08           -      -     39,794   4.19             -         -
States and municipalities*                   994   7.87           -      -          -      -         6,710      7.93
Other                                      2,824   8.00       3,197   5.52      1,251   5.10       191,994***   3.73
- ---------------------------------------------------------------------------------------------------------------------
Total                                    $45,707   2.64%   $102,781   4.36%   $91,976   4.38%   $2,451,699      4.30%
=====================================================================================================================
</Table>

  * Weighted average yields on tax-exempt obligations have been computed by
    adjusting allowable tax-exempt income to a fully taxable equivalent basis
    using a tax rate of 29 percent.
 ** Represents government agency issued mortgage-backed securities and
    collateralized mortgage obligations which, when adjusted for early paydowns,
    have an estimated average life of 3.6 years.
*** Represents equity securities with no stated maturity.

Investment securities averaged $2.4 billion in 2004 and $2.5 billion in 2003.
Investment securities represented 10 percent of earning assets in 2004, 12
percent in 2003 and 14 percent in 2002.

On December 31, 2004, AFS securities totaled $2.7 billion and consisted
primarily of mortgage-backed securities (MBS), collateralized mortgage
obligations (CMO), U.S. Treasuries, U.S. government agencies, and equities. On
December 31, 2004, these securities had $11.6 million of net unrealized losses
that resulted in a decrease in book equity of $7.1 million, net of $4.5 million
of deferred income taxes. See Note 3  -  Investment Securities for additional
detail. On December 31, 2003, AFS securities totaled $2.5 billion and had $5.2
million of net unrealized gains that resulted in an increase in book equity of
$3.2 million, net of $2.0 million of deferred income taxes.

LOANS HELD FOR SALE

Loans held for sale consist of the mortgage warehouse, HELOC, second-lien
mortgages, student loans, small issuer trust preferred securities and credit
card receivables. The mortgage warehouse accounts for the majority of loans held
for sale. Loans held for sale represented 18 percent of total earning assets in
2004 compared with 21 percent in 2003 and 17 percent in 2002. During 2004 loans
held for sale averaged $4.2 billion a decrease of 5 percent or $241.3 million
from 2003. During 2003 loans held for sale averaged $4.4 billion and increased
46 percent or $1.4 billion from 2002 as a result of a higher level of
originations. Since mortgage warehouse loans and other loans held for sale are
generally held in inventory for a short period of time, there may be significant
differences between average and period-end balances. At year-end 2004, loans
held for sale totaled $5.2 billion compared to $3.0 billion at the end of 2003
due to an increase in HELOC held for sale.

DEPOSITS AND OTHER SOURCES OF FUNDS

DEPOSITS

During 2004 core deposits decreased 2 percent, or $185.8 million, and averaged
$10.8 billion. This decrease reflects the divestiture of Springdale which had
core deposits of approximately $245 million

                                       20     First Horizon National Corporation





<Page>


in 2003 and a decline in escrow balances due to lower mortgage refinance
originations in 2004. In 2003 core deposits increased 11 percent, or $1.1
billion, to an average balance of $10.9 billion from $9.8 billion in 2002 as
escrow balances increased due to the high refinance origination volume.
Interest-bearing core deposits increased 4 percent or $254.9 million to an
average balance of $6.1 billion in 2004 from $5.8 billion in 2003 and 2002. This
growth rate was negatively impacted by the divestiture of Springdale, which had
interest-bearing core deposits of approximately $200 million in 2003. Growth in
interest-bearing core deposits is attributable to expansion strategies which
emphasize a focus on convenient hours, free checking and targeted financial
center expansions. Noninterest-bearing core deposits, which averaged $4.7
billion in 2004, decreased 9 percent or $440.6 million primarily due to lower
escrow balances in mortgage banking. Noninterest-bearing core deposits averaged
$5.1 billion in 2003 and grew 27 percent or $1.1 billion. This growth was
largely due to an increase in mortgage escrow and clearing accounts resulting
from the strong mortgage origination volume experienced in 2003 and an increase
in corporate deposits. In 2002, noninterest-bearing core deposits averaged $4.0
billion. Going forward, FHN expects to implement strategic growth initiatives
including offering financial services, such as deposit-taking, in key markets
where FHN already has an established mortgage-banking customer base.

OTHER SOURCES OF FUNDS

Short-term purchased funds (certificates of deposit greater than $100,000,
federal funds purchased, securities sold under agreements to repurchase,
commercial paper, and other short-term borrowings) averaged $11.2 billion for
2004, up 17 percent or $1.6 billion from the previous year. The increase in
short-term purchased funds was used to fund earning asset growth of 11 percent
or $2.4 billion in 2004. Short-term purchased funds increased 27 percent or $2.0
billion in 2003 and averaged $9.5 billion and $7.5 billion during 2003 and 2002,
respectively. Short-term purchased funds accounted for 46 percent of FHN's
funding (core deposits plus purchased funds and term borrowings) in 2004, 44
percent in 2003, and 42 percent in 2002. See Note 9  -  Short-Term Borrowings
for additional information.

Term borrowings included senior and subordinated borrowings and advances with
original maturities greater than one year. Term borrowings increased 67 percent
or $905.1 million and averaged $2.2 billion in 2004 compared to $1.3 billion in
2003, which increased 96 percent from $.7 billion in 2002. The increase in term
borrowings was also utilized in funding earning asset growth. Term borrowings on
December 31, 2004, were $2.6 billion, an increase of 52 percent, or $.9 billion
from 2003 year-end. See Note 10  -  Term Borrowings for additional information.

CAPITAL

Capital adequacy is an important indicator of financial stability and
performance. Management's objectives are to maintain a level of capitalization
that is sufficient to sustain asset growth, take advantage of profitable growth
opportunities and promote depositor and investor confidence. Overall, FHN's
capital position remained strong as shown in Table 12. Unrealized market
valuations had no material effect on the ratios.

TABLE 12 - CAPITAL RATIOS

<Table>
<Caption>
                                                              2004          2003          2002
- ------------------------------------------------------------------------------------------------
<S>                                                           <C>           <C>           <C>
Average shareholders' equity to average assets                 6.98%         7.16%         7.58%
Period-end shareholders' equity to assets                      6.86          7.71          7.10
FHN's tier 1 risk-based capital                                8.62          9.22          8.93
FHN's total risk-based capital                                13.18         13.19         11.54
FHN's leverage                                                 7.16          7.19          6.91
- ------------------------------------------------------------------------------------------------
</Table>

First Horizon National Corporation     21





<Page>


Banking regulators define minimum capital ratios for bank holding companies and
their bank subsidiaries. Based on the capital rules and definitions prescribed
by the banking regulators, should any depository institution's capital ratios
decline below predetermined levels, it would become subject to a series of
increasingly restrictive regulatory actions. The system categorizes a depository
institution's capital position into one of five categories ranging from
well-capitalized to critically under-capitalized. For an institution to qualify
as well-capitalized, Tier 1 Capital, Total Capital and Leverage capital ratios
must be at least 6 percent, 10 percent and 5 percent, respectively. As of
December 31, 2004, FHN and FTBNA had sufficient capital to qualify as
well-capitalized institutions as shown in Note 13 - Regulatory Capital.
Shareholders' equity was $2.0 billion at year-end 2004, up 8 percent from 2003,
which increased 12 percent from year-end 2002. The increase in shareholders'
equity during 2004 and 2003 came from retention of net income after dividends
and the effects of stock option exercises reduced by shares repurchased. The
Consolidated Statements of Shareholders' Equity highlight the changes in equity
since December 31, 2001.

On December 31, 2004, the closing sales price of FHN's common stock was $43.11
per share. The annual dividend yield for 2004 was 3.7 percent based on dividends
declared in 2004 and the closing market price of $44.10 on December 31, 2003. On
October 19, 2004, the board of directors extended the authorization, originally
announced in 2000, for the non-stock option plan-related repurchase of shares
from December 31, 2004, until December 31, 2007. Approximately 5.7 million
shares remain available under this authority. Repurchases, if any, are made in
the open market or through privately negotiated transactions and are subject to
market conditions, accumulation of excess equity and prudent capital management.
Pursuant to previously granted board authority, FHN may repurchase shares from
time to time for its stock option and other compensation plans and will evaluate
the level of capital and take action designed to generate or use capital as
appropriate for the interests of the shareholders.

TABLE 13 - ISSUER PURCHASES OF EQUITY SECURITIES

<Table>
<Caption>
                                                                   Total Number of         Maximum Number of
                                   Total                         Shares Purchased as        Shares that May
                                 Number of     Average Price           Part of              Yet Be Purchased
                                   Shares         Paid per        Publicly Announced       Under the Plans or
(Volume in thousands)            Purchased         Share          Plans or Programs             Programs
- ---------------------------------------------------------------------------------------------------------------
<S>                             <C>            <C>              <C>                      <C>
2004
October 1 to October 31                 -               -                    -                   30,021
November 1 to November 30               -               -                    -                   30,021
December 1 to December 31               -               -                    -                   30,021
- --------------------------------------------------------------------------------------
 TOTAL                                  -               -                    -
======================================================================================
</Table>

Compensation Plan Programs:

 -  A consolidated compensation plan share purchase program was approved on
    July 20, 2004 and was announced on August 6, 2004. This plan consolidates
    into a single share purchase program all of the previously authorized
    compensation plan share programs as well as the renewal of the authorization
    to purchase shares for use in connection with two compensation plans for
    which the share purchase authority had expired. The total amount authorized
    under this consolidated compensation plan share purchase program is 25.1
    million shares which may be purchased over the option exercise period of the
    various compensation plans on or before December 31, 2023. Stock options
    granted after January 2, 2004, must be exercised no later than the tenth
    anniversary of the grant date.

Other Programs:

 -  A non-stock option plan-related authority was announced on October 18, 2000,
    authorizing the purchase of up to 9.5 million shares. On October 16, 2001,
    it was announced that FHN's board of directors extended the expiration date
    of this program from June 30, 2002, until December 31, 2004. On October 19,
    2004, the board of directors extended the authorization until December 31,
    2007. On December 31, 2004, 5.7 million shares remained available for
    purchase under this program.

On December 31, 2004, book value per common share was $16.39 compared to $15.01
for 2003 and $13.35 for 2002. Average shares for the three-year period were
124.7 million in 2004, 126.8 million in 2003 and 126.7 million in 2002.
Period-end shares outstanding for this same three-year period were 123.5
million, 124.8 million and 125.6 million, respectively. The decline in shares

                                       22     First Horizon National Corporation





<Page>


outstanding in 2004 was primarily related to share repurchases made to offset
the impact of the issuance of trust preferred securities and the divestiture of
Springdale. The decline in shares outstanding in 2003 was primarily related to
the repurchase of shares in connection with the divestiture of Springdale. FHN's
shares are traded on The New York Stock Exchange under the symbol FHN. The sales
price ranges, net income per share and dividends declared by quarter, for each
of the last two years, are presented in Table 25.

While FHN may repurchase shares from time to time based upon factors described
above, in order to maintain FHN's well-capitalized status while sustaining the
strong balance sheet growth anticipated for 2005 through loan growth and the
impact of the SLK acquisition, management currently is not repurchasing shares
and is considering capital generation alternatives.

RISK MANAGEMENT

FHN has an enterprise-wide approach to risk governance, measurement, management,
and reporting including an economic capital allocation process that is tied to
risk profiles used to measure risk-adjusted returns. The Enterprise-wide
Risk/Return Management Committee oversees risk management governance. Committee
membership includes the CEO and other executive officers of FHN. The Executive
Vice President (EVP) of Risk Management oversees reporting for the committee.
Risk management objectives include evaluating risks inherent in business
strategies, monitoring proper balance of risks and returns, and managing risks
to minimize the probability of future negative outcomes. The Enterprise-wide
Risk/Return Management Committee oversees and receives regular reports from the
Senior Credit Policy Committee, Asset/Liability Committee (ALCO), and
Operational Risk Committee. The EVP and Chief Credit Officer, EVP of Interest
Rate Risk Management, and EVP of Risk Management chair these committees,
respectively. Reports regarding Credit, Asset/Liability, Market, and Operational
Risks are provided to the Executive and Audit Committees of the Board and to the
full Board.

Risk management practices include key elements such as independent checks and
balances, formal authority limits, policies and procedures, and portfolio
management all executed through experienced personnel. The internal audit
department also evaluates risk management activities. These activities include
performing internal audits, the results of which are reviewed with management
and the Audit Committee, as appropriate.

INTEREST RATE RISK MANAGEMENT

The primary purpose of managing interest rate risk is to minimize the volatility
to earnings from changes in interest rates and preserve the value of FHN's
capital. ALCO, a committee consisting of senior management that meets regularly,
is responsible for coordinating the financial management of interest rate risk.
Interest rate risk is managed by structuring the balance sheet to attempt to
maintain the desired level of net interest income and other revenue while
managing interest sensitivity risk and liquidity. Derivative financial
instruments are used to aid in managing the exposure of the balance sheet and
related net interest income and noninterest income to changes in interest rates.
Interest rate sensitivity risk is defined as the risk that future changes in
interest rates will adversely impact income.

FHN's net interest income and its financial condition are affected by changes in
the level of market interest rates as the repricing characteristics of its loans
and other assets do not necessarily match those of its deposits and other
borrowings. To the extent that the interest rates on earning assets reprice less
quickly than liabilities, this position will benefit net interest income in a
declining interest rate environment and will negatively impact net interest
income in a rising interest rate environment. In the case of floating rate
assets and liabilities, FHN may also be exposed to basis risk, which results
from changing spreads between loan and deposit rates.

FHN uses simulation analysis as its primary tool to evaluate interest rate risk
exposure. This type of analysis computes net interest income at risk under a
variety of market interest rate scenarios to

First Horizon National Corporation     23





<Page>


dynamically identify interest rate risk exposures. This simulation, which
considers forecasted balance sheet changes, prepayment speeds, deposit mix,
pricing impacts, and other changes in the net interest spread, provides an
estimate of the annual net interest income at risk for given changes in interest
rates. The results help FHN develop strategies for managing exposure to interest
rate risk. Like any forecasting technique, interest rate simulation modeling is
based on a number of assumptions and judgments. In this case, the assumptions
relate primarily to loan and deposit growth, asset and liability prepayments,
interest rates, and on- and off-balance sheet management strategies. Management
believes the assumptions used in its simulations are reasonable. Nevertheless,
simulation modeling provides only a sophisticated estimate, not a precise
calculation of exposure to changes in interest rates.

The simulation models used to analyze the retail/commercial bank's net interest
income create various at-risk scenarios looking at increases and/or decreases in
interest rates from an instantaneous movement or a staggered movement over a
certain time period. In addition, the risk of changes in the yield curve is
estimated by flattening and steepening the yield curve to historical levels.
Management reviews these different scenarios to determine alternative strategies
and executes based on that evaluation. The models are continuously updated to
incorporate management action. Any scenarios that indicate a net interest income
at risk of 3 percent or more are presented to the Board quarterly. A 300 basis
point staggered increase or decrease in interest rates over a one-year period is
a key scenario analyzed. These moves are used to estimate net interest income
exposure to historically extreme movements in interest rates. Due to the current
abnormally low level of rates, the federal funds overnight rate was modeled into
the simulation analysis using a floor of 25 basis points. The bank's rate
sensitivity position shows a risk to scenarios that project declining rates.
This position is driven by floating rate assets that have increased in yield and
now have further to decline; while non-maturity deposit costs have increased
slightly and are still very close to their floors. Based on the rate sensitivity
position on December 31, 2004, net interest income exposure over the next 12
months to a staggered decrease in interest rates of 200 basis points is
estimated to be approximately five percent of base net interest income. A
staggered increase of 300 basis points results in a favorable variance in net
interest income of approximately three percent. A 300 basis point staggered
increase and a 200 basis point staggered decrease in interest rates are
hypothetical rate scenarios. These scenarios are used as one estimate of risk,
and do not necessarily represent management's current view of future interest
rates or market developments. Actual results will differ from simulated results
due to timing, magnitude and frequency of interest rate changes and changes in
market conditions, and management's strategies, among other factors, including
those presented in the Forward-Looking Statements section of this MD&A.

Other than the impact related to the immediate change in value of balance sheet
accounts, such as MSR, these simulation models and related hedging strategies
exclude the dynamics related to how fee income and noninterest expense may be
affected by actual changes in interest rates or expectations of changes.
Mortgage banking revenue, which is generated from originating, selling and
servicing residential mortgage loans, is highly sensitive to changes in interest
rates due to the direct effect changes in interest rates have on loan demand. In
general, low or declining interest rates typically lead to increased origination
and sales income but potentially lower servicing-related income due to the
impact of higher loan prepayments on the value of mortgage servicing assets.
Conversely, high or rising interest rates typically reduce mortgage loan demand
and hence origination and sales income while servicing-related income may rise
due to lower prepayments. The effect on origination and sales income to total
earnings is more significant than servicing related income. In addition, net
interest income earned on loans held for sale and on swaps and similar
derivative instruments used to protect the value of MSR increases when the yield
curve steepens and decreases when the yield curve flattens. Capital markets
revenue from fixed income securities sales is negatively affected when, as in
2004, significant uncertainties regarding changes, including the timing of
changes, in interest rates cause fixed income investors to delay their
purchases.

To determine the amount of interest rate risk and market value exposure of loan
commitments in the pipeline, loans in the mortgage warehouse and MSR, mortgage
banking uses multiple scenario rate shock analysis, including the magnitude and
direction of interest rate changes, prepayment speeds, and other factors that
could affect mortgage banking. As discussed in Critical Accounting Policies,
derivative financial instruments are used by mortgage banking for two purposes.
First, forward

                                       24     First Horizon National Corporation





<Page>


contracts and option contracts are used to protect the value of the pipeline and
mortgage warehouse against rises in interest rates between the time an interest
rate is committed to the customer and the mortgage is sold into the secondary
market. Second, interest rate contracts are utilized to protect against MSR
prepayment risk that generally accompanies declining interest rates. As interest
rates fall, the value of MSR should decrease and the value of the servicing
hedge should increase. The converse is also true. Ineffectiveness in these
hedging strategies (when changes in the value of the derivative instruments do
not match changes in the value of the hedged portion of our MSR for any given
change in long-term interest rates) is reflected in noninterest income.

Derivative instruments are also used to protect against the risk of loss arising
from adverse changes in the fair value of capital markets' securities inventory
due to changes in interest rates.

FHN does not use derivative instruments to protect against the prepayment risk
(due to interest rate changes or other factors) of loans or loans held for sale
(other than mortgage warehouse).

Management uses the results of interest rate exposure models to formulate
strategies to improve balance sheet positioning, earnings, or both, within FHN's
interest rate risk, liquidity and capital guidelines.

The derivative financial instruments listed in Table 14 are shown at both
notional and fair values. Table 14 also details FHN's interest rate sensitivity
profile on December 31, 2004, based on projected cash flows using anticipated
sale date on loans held for sale, contractual maturity for loans and expected
repayment dates for securities. The information provided in this section
including the discussion regarding simulation analysis and rate shock analysis
is forward-looking. Actual results could differ because of interest rate
movements, the ability of management to execute its business plans and other
factors, including those presented in the Forward-Looking Statements section of
this MD&A.

TABLE 14 - RISK SENSITIVITY ANALYSIS

<Table>
<Caption>
HELD FOR TRADING                                                                                           Fair
(Dollars in millions)                            2005    2006    2007    2008    2009    2010+    Total    Value
- ----------------------------------------------------------------------------------------------------------------
<S>                                             <C>      <C>     <C>     <C>     <C>     <C>      <C>      <C>
ASSETS:
Trading securities:
 Floating                                       $  698       -       -       -       -   $  290   $  988   $988
   Average interest rate                          3.57%      -       -       -       -    13.11%    6.37%
- ----------------------------------------------------------------------------------------------------------------
INTEREST RATE DERIVATIVES (NOTIONAL VALUE):
CAPITAL MARKETS:
Forward contracts:
 Commitments to buy                             $2,001       -       -       -       -        -   $2,001   $ (1)
   Weighted average settlement price             93.16%      -       -       -       -        -    93.16%
 Commitments to sell                            $2,106       -       -       -       -        -   $2,106   $  1
   Weighted average settlement price             93.68%      -       -       -       -        -    93.68%
 Caps purchased                                 $   60       -       -       -       -        -   $   60   $ (1)
   Weighted average strike price                  5.67%      -       -       -       -        -     5.67%
 Caps written                                   $  (60)      -       -       -       -        -   $  (60)  $  1
   Weighted average strike price                  5.67%      -       -       -       -        -     5.67%
 Swap contracts                                      -   $   8   $  29   $  29       -   $   38   $  104   $ (4)
   Average pay rate (floating)                       -    5.19%   5.35%   4.63%      -     2.78%    4.21%
   Average receive rate (fixed)                      -    6.48%   6.42%   4.95%      -     5.77%    5.78%
 Swap contracts                                      -   $  (8)  $ (29)  $ (29)      -   $  (38)  $ (104)  $  4
   Average pay rate (fixed)                          -    6.48%   6.42%   4.95%      -     5.77%    5.78%
   Average receive rate (floating)                   -    5.19%   5.35%   4.63%      -     2.78%    4.21%
- ----------------------------------------------------------------------------------------------------------------
</Table>

First Horizon National Corporation
                                       25





<Page>


TABLE 14 - RISK SENSITIVITY ANALYSIS (CONTINUED)

<Table>
<Caption>
HELD FOR PURPOSES OTHER THAN TRADING                                                                        Fair
(Dollars in millions)                       2005     2006     2007     2008     2009    2010+     Total     Value
<S>                                        <C>      <C>      <C>      <C>      <C>      <C>      <C>       <C>
- ------------------------------------------------------------------------------------------------------------------
ASSETS:
Loans, net of unearned income*:
 Floating                                  $4,910   $  877   $  389   $  260   $  227   $5,159   $11,822   $11,822
   Average interest rate                     5.38%    4.78%    4.66%    4.41%    5.01%    4.99%     5.11%
 Fixed                                     $  691   $  532   $  527   $  602   $  474   $1,739   $ 4,565   $ 4,556
   Average interest rate                     5.67%    5.90%    5.83%    5.54%    5.92%    6.38%     5.99%
Loans held for sale - floating             $3,165        -        -        -        -        -   $ 3,165   $ 3,178
   Average interest rate                     6.02%       -        -        -        -        -      6.02%
Loans held for sale - fixed                $2,003        -        -        -        -        -   $ 2,003   $ 2,017
   Average interest rate                     6.15%       -        -        -        -        -      6.15%
Investment securities - fixed              $  390   $  412   $  460   $  289   $  216   $  827   $ 2,594   $ 2,594
   Average interest rate                     3.92%    4.24%    4.25%    4.31%    4.30%    4.29%     4.22%
Investment securities - floating                -        -   $    4        -        -   $   83   $    87   $    87
   Average interest rate                        -        -     5.00%       -        -     4.25%     4.28%
Liquid assets - floating**                 $  688        -        -        -        -        -   $   688   $   688
   Average interest rate                     1.74%       -        -        -        -        -      1.74%
- ------------------------------------------------------------------------------------------------------------------
LIABILITIES:
Interest-bearing deposits:
Defined maturity
 Floating                                  $  712   $  414   $    8   $    5   $  200        -   $ 1,339   $ 1,339
   Average interest rate                     2.35%    2.33%    1.22%    1.22%    2.64%       -      2.38%
 Fixed                                     $7,733   $  391   $  251   $   81   $  158   $  324   $ 8,938   $ 8,972
   Average interest rate                     2.32%    3.23%    4.19%    3.86%    4.19%    5.02%     2.56%
Undefined maturity
 Floating                                       -        -        -        -        -   $2,541   $ 2,541   $ 2,541
   Average interest rate                        -        -        -        -        -     1.11%     1.11%
 Fixed                                          -        -        -        -        -   $1,969   $ 1,969   $ 1,969
   Average interest rate                        -        -        -        -        -      .40%      .40%
Short-term borrowings:
 Floating                                  $3,719        -        -        -        -        -   $ 3,719   $ 3,719
   Average interest rate                     2.16%       -        -        -        -        -      2.16%
 Fixed                                     $   24        -        -        -        -   $   10   $    34   $    34
   Average interest rate                     1.18%       -        -        -        -     5.78%     2.55%
Term borrowings - floating                 $1,050   $  150   $   50        -        -        -   $ 1,250   $ 1,250
   Average interest rate                     2.33%    2.38%    2.67%       -        -        -      2.35%
Term borrowings - fixed                    $   25        -        -   $  231        -   $1,110   $ 1,366   $ 1,397
   Average interest rate                     6.65%       -        -     6.00%       -     5.57%     5.66%
- ------------------------------------------------------------------------------------------------------------------
</Table>

 * Excludes nonaccrual loans.
** Consists of federal funds sold, securities purchased under agreements to
   resell and investments in time deposits.

                                       26     First Horizon National Corporation





<Page>


TABLE 14 - RISK SENSITIVITY ANALYSIS (CONTINUED)

<Table>
<Caption>
HELD FOR PURPOSES OTHER THAN TRADING                                                                            Fair
(Dollars in millions)                            2005     2006     2007     2008     2009    2010+     Total    Value
<S>                                             <C>      <C>      <C>      <C>      <C>      <C>      <C>       <C>
- ---------------------------------------------------------------------------------------------------------------------
DERIVATIVES (NOTIONAL VALUE):
MORTGAGE BANKING:
Pipeline and warehouse hedging
 Forward contracts to sell                      $3,399        -        -        -        -        -   $ 3,399   $ (6)
   Weighted average settlement price            100.79%       -        -        -        -        -    100.79%
 Future contracts sold                          $3,616   $2,176   $1,632   $1,039   $1,465        -   $ 9,928   $ (1)
   Weighted average strike price                 96.90%   96.10%   95.57%   95.11%   94.90%       -     96.02%
 Interest rate lock commitments                 $3,309        -        -        -        -        -   $ 3,309   $ 16
   Average interest rate                          5.82%       -        -        -        -        -      5.82%
 Put options purchased                          $ (500)       -        -        -        -        -   $  (500)  $ (1)
   Weighted average strike price                 99.37%       -        -        -        -        -     99.37%
 Call options written                           $  250        -        -        -        -        -   $   250      *
   Weighted average strike price                 99.73%       -        -        -        -        -     99.73%
Servicing portfolio hedging
 Swaptions                                      $3,400        -        -        -        -        -   $ 3,400   $ 13
   Weighted average strike price                  4.36%       -        -        -        -        -      4.36%
 Swaps                                               -        -        -        -        -   $2,805   $ 2,805   $ 79
   Average pay rate (floating)                       -        -        -        -        -     2.32%     2.32%
   Average receive rate (fixed)                      -        -        -        -        -     4.83%     4.83%
INTEREST RATE RISK MANAGEMENT:
Swaps                                           $  176   $   47   $    9   $  196   $   26   $1,051   $ 1,505   $  5
 Average pay rate (floating)                      2.46%    2.03%    2.32%    2.39%    2.40%    2.66%     2.58%
 Average receive rate (fixed)                     3.23%    3.96%    3.73%    4.09%    3.99%    5.41%     4.90%
Swaps                                           $   26   $   47   $    9   $   54   $   26   $    1   $   163   $ (3)
 Average pay rate (fixed)                         5.20%    3.84%    3.54%    4.93%    3.87%    5.10%     4.42%
 Average receive rate (floating)                  2.41%    2.03%    2.32%    2.37%    2.40%    2.41%     2.28%
Caps purchased                                  $    7   $    4   $   10        -        -   $    2   $    23      *
 Weighted average strike price                    4.00%    3.00%    4.00%       -        -     8.00%     4.17%
Caps written                                    $   (7)  $   (4)  $  (10)       -        -        -   $   (21)     *
 Weighted average strike price                    4.00%    3.00%    4.00%       -        -        -      3.81%
- ---------------------------------------------------------------------------------------------------------------------
</Table>

* Amount is less than $500,000

First Horizon National Corporation     27





<Page>


LIQUIDITY RISK MANAGEMENT

Liquidity risk is the risk of being unable to fund assets with liabilities of
the appropriate duration and interest rate, as well as the risk of not being
able to meet unexpected cash needs. The objective of liquidity management is to
ensure the continuous availability of funds to meet the demands of depositors,
other creditors and borrowers, and the requirements of ongoing operations. This
objective is met by maintaining liquid assets in the form of trading securities
and securities available for sale, maintaining sufficient unused borrowing
capacity in the national money markets, growing core deposits, and the repayment
of loans and the capability to sell or securitize loans. ALCO is responsible for
managing these needs by taking into account the marketability of assets; the
sources, stability and availability of funding; and the level of unfunded
commitments. See Note 18  -  Restrictions, Contingencies, Commitments, and Other
Disclosures for additional information. Funds are available from a number of
sources, including core deposits, the securities available for sale portfolio,
the Federal Home Loan Bank, the Federal Reserve Board, access to capital markets
through issuance of senior or subordinated bank notes and institutional
certificates of deposit, availability to the overnight and term Federal Funds
markets, access to retail brokered certificates of deposit, dealer and
commercial customer repurchase agreements, and through the sale or
securitization of loans.

Core deposits are a significant source of funding and have been a stable source
of liquidity for banks. These deposits are insured by the Federal Deposit
Insurance Corporation to the maximum extent authorized by law. For 2004, the
average total loans, excluding loans held for sale, to core deposit ratio was
143 percent compared with 116 percent and 108 percent in 2003 and 2002,
respectively. As loan growth currently exceeds core deposit growth, alternative
sources of funding loan growth may be necessary in order to maintain an adequate
liquidity position. One means of maintaining a stable liquidity position is to
sell loans either through whole loan sales or loan securitizations. FHN
periodically evaluates its liquidity position in conjunction with determining
its ability and intent to hold loans to maturity.

FTBNA has a bank note program available for additional liquidity under which the
bank may borrow funds from time to time at maturities of 30 days to 30 years. On
December 31, 2004, $.1 billion was available under current conditions through
the bank note program as a long-term (greater than one year) funding source
compared to $1.0 billion in 2003. In February 2005, FTBNA established a new bank
note program providing additional liquidity of $5.0 billion (see also Subsequent
Events). Borrowings under the old bank note program increased $290.1 million
during 2004 in order to meet increased liquidity needs related to strong loan
growth. FTBNA also has the ability to enhance its liquidity position by issuing
preferred equity or incurring other debt. FHN also evaluates alternative sources
of funding, including loan sales, securitizations, syndications, Federal Home
Loan Bank borrowings, debt offerings and equity offerings in its management of
liquidity. Due to considerable growth of the HELOC portfolio, securitization of
this loan type was an important funding source in 2004 and should grow in
significance in future years.

In addition, liquidity has been obtained through the issuance of $300.0 million
of guaranteed preferred beneficial interest in FHN's junior subordinated
debentures through two Delaware business trusts wholly owned by FHN and through
preferred stock issued by an indirect wholly-owned subsidiary of FHN ($45.7
million and $45.6 million on December 31, 2004 and 2003, respectively). See Note
10  -  Term Borrowings, Note 11  -  Guaranteed Preferred Beneficial Interests in
First Horizon's Junior Subordinated Debentures and Note 12  -  Preferred Stock
of Subsidiary for additional information.

The Consolidated Statements of Cash Flows provide information on cash flows from
operating, investing and financing activities for each of the three years ending
December 31, 2004. In 2004, cash flows from operating activities were negative
primarily due to funding increased levels of HELOC held for sale and growth in
MSR and other retained interests resulting from securitization activities. In
2003, cash flows from operating activities were positive as the mortgage
warehouse decreased from 2002 levels due to a rising mortgage interest rate
environment. In 2002, growth in the mortgage warehouse resulted in negative cash
flows from operating activities. Earnings represent a significant source of
liquidity, consistently providing positive cash flows in each of the three
years. In 2004, strong deposit growth provided a significant portion of FHN's
positive cash flows from financing activities and was utilized to meet increased
liquidity needs related to strong loan growth as reflected in negative cash

                                       28     First Horizon National Corporation





<Page>


flows from investing activities. The issuance of term borrowings is an essential
source of cash flows, and term borrowings were also utilized to better match the
increased liquidity needs related to strong loan growth during the three-year
period. Deposit growth also provided considerable positive cash flows in 2002.
Sales and maturities of investment securities largely offset purchases in each
of the three years.

Parent company liquidity is maintained by cash flows stemming from dividends and
interest payments collected from subsidiaries, which represent the primary
source of funds to pay dividends to shareholders and interest to debt holders.
The amount of dividends from FTBNA is subject to certain regulatory restrictions
that are described in Note 18  -  Restrictions, Contingencies, Commitments, and
Other Disclosures. The parent company statements are presented in Note
26  -  Parent Company Financial Information. The parent company also has the
ability to enhance its liquidity position by raising equity or incurring debt.
Under an effective shelf registration statement on file with the SEC, FHN, as of
December 31, 2004, may offer from time to time at its discretion, debt
securities and common and preferred stock aggregating up to $125 million.

OFF-BALANCE SHEET ARRANGEMENTS AND OTHER CONTRACTUAL OBLIGATIONS

First Horizon Home Loans originates conventional conforming and federally
insured single-family residential mortgage loans. Likewise, FTN Financial
Capital Assets Corporation frequently purchases the same types of loans from
customers. Substantially all of these mortgage loans are exchanged for
securities, which are issued through investors, including Government Sponsored
Entities (GSE), such as GNMA for federally insured loans and FNMA and FHLMC for
conventional loans, and then sold in the secondary markets. After sale, these
loans are not reflected on the Consolidated Statements of Condition. Each of the
GSE has specific guidelines and criteria for sellers and servicers of loans
backing their respective securities. FHN's use of GSE as an efficient outlet for
mortgage loan production is an essential source of liquidity for FHN and other
participants in the housing industry. During 2004 and 2003, approximately $19.3
billion and $40.9 billion, respectively, of conventional and federally insured
mortgage loans were securitized and sold by First Horizon Home Loans through
these GSE. See also Note 18  -  Restrictions, Contingencies, Commitments and
Other Disclosures.

Certain of FHN's originated loans do not conform to the requirements for sale or
securitization by FNMA and FHLMC. FHN pools and securitizes these non-conforming
loans in proprietary transactions. After securitization and sale, these loans
are not reflected on the Consolidated Statements of Condition except as
described hereafter (see Credit Risk Management  -  Mortgage Banking). These
transactions, which are conducted through single-purpose business trusts, are
the most efficient way for FHN and other participants in the housing industry to
monetize these assets. On December 31, 2004 and 2003, the outstanding principal
amount of loans in these off-balance sheet business trusts was $11.3 billion and
$6.0 billion, respectively. Given the significance of FHN's origination of
non-conforming loans, the use of single-purpose business trusts to securitize
these loans is an important source of liquidity to FHN. See Note
24  -  Securitizations for additional information.

Pension obligations are funded by FHN to provide current and future benefit to
participants in FHN's noncontributory, defined benefit pension plan. On
September 30, 2004, the annual measurement date, pension obligations were $333.4
million with $348.1 million of assets in the trust to fund those obligations.
All qualified plans are generally funded to the amounts of accumulated benefit
obligations. FHN expects to contribute the maximum tax deductible contribution
to the pension plan in 2005, which is estimated to be approximately $15 million
to $17 million. In 2004, FHN contributed $57.0 million to the pension plan. The
discount rate for 2004 of 6.47 percent was determined by using a hypothetical AA
yield curve represented by a series of annualized individual discount rates from
one-half to thirty years. The discount rate for the pension plan is selected
based on data specific to FHN's plans and employee population. See Note
20  -  Savings, Pension and Other Employee Benefits for additional information.

FHN has various other financial obligations, which may require future cash
payments. Table 15 sets forth contractual obligations representing required and
potential cash outflows as of December 31, 2004. Purchase obligations represent
obligations under agreements to purchase goods or services that are enforceable
and legally binding on FHN and that specify all significant terms, including
fixed or minimum quantities to be purchased, fixed, minimum or variable price
provisions, and the approximate

First Horizon National Corporation     29





<Page>


timing of the transaction. In addition, FHN enters into commitments to extend
credit to borrowers, including loan commitments, standby letters of credit, and
commercial letters of credit. These commitments do not necessarily represent
future cash requirements, in that these commitments often expire without being
drawn upon. See Note 18  -  Restrictions, Contingencies, Commitments and Other
Disclosures for additional information.

TABLE 15 - CONTRACTUAL OBLIGATIONS

<Table>
<Caption>
                                                           Payments due by period
                                        -------------------------------------------------------------
                                        Less than       1-3         4-5       After 5
(Dollars in thousands)                    1 year       years       years       years         Total
- -----------------------------------------------------------------------------------------------------
<S>                                     <C>          <C>          <C>        <C>          <C>
CONTRACTUAL OBLIGATIONS:
   Time deposit maturities*             $8,445,181   $1,064,189   $443,389   $  324,679   $10,277,438
   Term borrowings**                     1,074,490      200,668    232,276    1,109,343     2,616,777
   Annual rental commitments under
     noncancelable leases***                59,084       95,622     49,943       40,471       245,120
   Purchase obligations                     25,311       20,693      7,013       17,326        70,343
- -----------------------------------------------------------------------------------------------------
Total contractual obligations           $9,604,066   $1,381,172   $732,621   $1,491,819   $13,209,678
=====================================================================================================
</Table>

  * See Note 8  -  Time Deposit Maturities for further details.
 ** See Note 10  -  Term Borrowings for further details.
*** See Note 5  -  Premises, Equipment and Leases for further details.

CREDIT RATINGS

Maintaining adequate credit ratings on debt issues is critical to liquidity
because it affects the ability of FHN to attract funds from various sources,
such as brokered deposits or wholesale borrowings of which FHN had $6.2 billion
and $3.6 billion on December 31, 2004 and 2003, respectively, on a
cost-competitive basis (see also Liquidity Risk Management). The various credit
ratings are detailed in Table 16. The availability of funds other than core
deposits is also dependent upon marketplace perceptions of the financial
soundness of FHN, which include such issues as capital levels, asset quality and
reputation. The availability of core deposit funding is dependent upon federal
deposit insurance, which can be removed only in extraordinary circumstances, but
may also be influenced to some extent by the same factors that affect other
funding sources.

TABLE 16 - CREDIT RATINGS

<Table>
<Caption>
                                                              Standard & Poor's    Moody's       Fitch
- ---------------------------------------------------------------------------------------------------------
<S>                                                           <C>                 <C>         <C>
FIRST HORIZON NATIONAL CORPORATION
Overall credit rating                                           A-/Stable         A2/Stable   A/Stable/F1
Subordinated debt                                                  BBB+              A3           A-
Capital securities*                                                BBB               A3           A-
- ---------------------------------------------------------------------------------------------------------
FIRST TENNESSEE BANK NATIONAL ASSOCIATION
Overall credit rating                                          A/Stable/A-1       A1/Stable   A/Stable/F1
Long-term/short-term deposits                                     A/A-1            A1/P-1        A+/F1
Other long-term/short-term funding**                                A              A1/P-1          A
Subordinated debt                                                   A-               A2            A-
- ---------------------------------------------------------------------------------------------------------
FT REAL ESTATE SECURITIES COMPANY, INC.
Preferred stock                                                    BBB+              A3
- ---------------------------------------------------------------------------------------------------------
</Table>

 * Guaranteed preferred beneficial interests in First Horizon's junior
   subordinated debentures issued through a wholly-owned unconsolidated business
   trust.
** Other funding includes senior bank notes.
A rating is not a recommendation to buy, sell or hold securities and is subject
to revision or withdrawal at any time and should be evaluated independently of
any other rating.
                                       30     First Horizon National Corporation





<Page>


MARKET RISK MANAGEMENT

Capital markets buys and sells various types of securities for its customers.
When these securities settle on a delayed basis, they are considered forward
contracts. Inventory positions are limited to the procurement of securities
solely for distribution to customers by the sales staff, and ALCO policies and
guidelines have been established with the objective of limiting the risk in
managing this inventory.

CREDIT RISK MANAGEMENT

Credit risk is the risk of loss due to adverse changes in a borrower's ability
to meet its financial obligations under agreed upon terms. FHN is subject to
credit risk in lending, trading, investing, liquidity/funding and asset
management activities. The nature and amount of credit risk depend on the types
of transactions, the structure of those transactions and the parties involved.
In general, credit risk is incidental to trading, liquidity/funding and asset
management activities, while it is central to the profit strategy in lending. As
a result, the majority of credit risk is associated with lending activities.

FHN has processes and management committees in place that are designed to assess
and monitor credit risks. Management's Asset Quality Committee has the
responsibility to evaluate its assessment of current asset quality for each
lending product. In addition, the Asset Quality Committee evaluates the
projected changes in classified loans, non-performing assets and charge-offs. A
primary objective of this committee is to provide information about changing
trends in asset quality by region or loan product, and to provide to senior
management a current assessment of credit quality as part of the estimation
process for determining the allowance for loan losses. The Senior Credit Watch
Committee has primary responsibility to enforce proper loan risk grading, to
identify credit problems, and to monitor actions to rehabilitate certain
credits. Management also has a Senior Credit Policy Committee that is
responsible for enterprise-wide credit risk oversight and provides a forum for
addressing management issues. The committee also develops credit policies, which
are approved by the Executive Committee of the Board, and underwriting
guidelines to manage the level and composition of credit risk in its loan
portfolio and review performance relative to these policies. In addition, the
Financial Counterparty Credit Committee, composed of senior managers, assesses
the credit risk of financial counterparties and sets limits for exposure based
upon the credit quality of the counterparty. FHN's goal is to manage risk and
price loan products based on risk management decisions and strategies.
Management strives to identify potential problem loans and nonperforming loans
early enough to correct the deficiencies. It is management's objective that both
charge-offs and asset write-downs are recorded promptly, based on management's
assessments of current collateral values and the borrower's ability to repay.

FHN has a significant concentration in loans secured by real estate. In 2004, 66
percent of total loans are secured by real estate compared to 62 percent in 2003
(see Table 9). Three lending products have contributed to this increased level
of real estate lending  -  (1) significant growth in second mortgages identified
as HELOC which grew 50 percent; (2) commercial construction lending which grew
42 percent led by growth in loans to single-family builders; and (3) retail real
estate construction which grew 69 percent. FHN's commercial real estate lending
is well-diversified by product type and industry. On December 31, 2004, FHN did
not have any concentrations of 10 percent or more of total commercial, financial
and industrial loans in any single industry.

ALLOWANCE FOR LOAN LOSSES AND CHARGE-OFFS

Management's policy is to maintain the allowance for loan losses at a level
sufficient to reflect the estimated probable incurred losses in the loan
portfolio. The allowance for loan losses is increased by the provision for loan
losses and recoveries and is decreased by charged-off loans. The adequacy of the
allowance for loan losses is analyzed quarterly. The Chief Credit Officer has
the responsibility for performing a comprehensive review of the allowance for
loan losses and making a recommendation to the Executive Committee of the Board
for approval of the allowance for loan losses at each quarterly reporting
period. An analytical model based on historical loss experience, adjusted for
current events, trends and economic conditions is used to assess the adequacy of
the allowance for loan losses. This methodology determines an estimated loss
percentage (reserve rate), which is applied against the balance of loans in each
segment of the loan portfolio at the evaluation date. The nature of the

First Horizon National Corporation     31





<Page>


process by which FHN determines the appropriate allowance for loan losses
requires the exercise of considerable judgment. After review of all relevant
factors, management believes the allowance for loan losses is adequate and
reflects its best estimate of probable incurred losses.

The total allowance for loan losses decreased to $158.2 million on December 31,
2004, from $160.3 million at year-end 2003, which was up $16.0 million since
year-end 2002. Period-end loans increased 17 percent in 2004 after increasing 23
percent in 2003. The ratio of allowance for loan losses to loans, net of
unearned income, decreased to .96 percent on December 31, 2004, from
1.15 percent on December 31, 2003, primarily reflecting improvement in the
retail loan portfolio's risk profile as the mix shifted to a higher
concentration of loans to high credit score borrowers. The risk profile of the
commercial loan portfolio also improved due to a stronger economy, as evidenced
by current lower levels of watch list and classified loans. The ratio of
allowance for loan losses to loans was 1.27 percent on December 31, 2002.

Table 18 summarizes by category loans charged off and recoveries of loans
previously charged off. This table also shows the additions to the reserve
(provision), which have been charged against operating earnings. Table 17 shows
net charge-off ratios. Net charge-offs decreased to $42.1 million for the year
ended December 31, 2004 down from $68.0 million in 2003 and $98.5 million in
2002. The decrease in the 2004 level of net charge-offs was impacted by
improvement in both the retail and commercial loan portfolios. Total commercial
and commercial real estate related loan net charge-offs decreased to $11.9
million in 2004 from $20.6 million in 2003. The commercial loan net charge-offs,
which were not concentrated in any one industry or region, decreased as the
economy improved. Residential real estate loan net charge-offs decreased to
$16.8 million in 2004 from $31.0 million in 2003 as successful cross-sell
efforts to mortgage banking customers led to an improvement in the mix of the
portfolio as evidenced by an overall increase in credit scores and reduced loan
to value ratios. Credit card receivables net charge-offs decreased to $10.6
million from $12.2 million in 2003, and other retail loan net charge-offs
decreased to $2.9 million in 2004 from $4.3 million in 2003. The ratio of net
charge-offs to average loans decreased to .27 percent for 2004 from .54 percent
for 2003 and .93 percent for 2002.

TABLE 17 - NET CHARGE-OFF RATIOS*

<Table>
<Caption>
                                                                   2004        2003       2002
- ----------------------------------------------------------------------------------------------
<S>                                                                <C>         <C>        <C>
Commercial                                                           .18%      .34%        .75%
Retail real estate**                                                 .20       .48         .64
Other retail                                                        1.55       1.64       3.47
Credit card receivables                                             4.25       4.65       4.35
Total net charge-offs                                                .27       .54         .93
- ----------------------------------------------------------------------------------------------
</Table>

Loans are averages expressed net of unearned income.
 * Table 9 provides information on the relative size of each loan portfolio.
** Excludes ($.1) million, $1.6 million and $3.6 million of net
   charge-offs/(recoveries) for 2004, 2003 and 2002, respectively, related to
   loans classified as nonperforming from the warehouse and the repurchase of
   loans originated and previously sold by First Horizon Home Loans.

Within the course of normal mortgage banking activities, a small percentage of
mortgage loan originations are classified as nonperforming assets when FHA/VA
borrowers are delinquent in their monthly payments prior to the completion of
the insuring process. Additionally, loans that have been sold may be required to
be repurchased if they are found not to meet an investor's origination criteria.
From this pool, there were net recoveries of $.1 million in 2004, down from net
charge-offs of $1.6 million in 2003 due to changes in the disposition of these
assets.

Going forward, asset quality indicators should reflect the relative strength of
the economy and the early recognition and resolution of asset quality issues. In
addition, asset quality ratios could be affected by balance sheet strategies and
shifts in loan mix to and from products with different risk/return profiles.
Actual results could differ because of several factors, including those
presented in the Forward-Looking Statements section of this MD&A discussion.

                                       32     First Horizon National Corporation





<Page>


TABLE 18 - ANALYSIS OF ALLOWANCE FOR LOAN LOSSES

<Table>
<Caption>
(Dollars in thousands)             2004          2003          2002          2001          2000          1999
- --------------------------------------------------------------------------------------------------------------------
<S>                             <C>           <C>           <C>           <C>           <C>           <C>
ALLOWANCE FOR LOAN LOSSES:
Beginning balance               $   160,333   $   144,298   $   150,614   $   139,210   $   134,979   $  131,906
Provision for loan losses            48,348        86,698        92,184        93,220        67,491       57,406
Divestitures/transfers to
 held for sale                       (8,382)       (2,652)            -        (1,337)       (2,173)      (2,683)
Charge-offs:
Commercial:
 Commercial, financial and
   industrial                        11,925        12,460        37,241        22,596         6,583        9,714
 Real estate commercial               2,690         3,067         2,966         4,156           857          510
 Real estate construction               779         7,642         3,367           968            47            -
Retail:
 Real estate residential*            21,271        35,809        36,726        30,532        17,348        9,742
 Other retail                         7,094         9,920        19,979        20,603        20,868       17,392
 Credit card receivables             12,870        13,538        12,862        13,369        25,485       22,867
- --------------------------------------------------------------------------------------------------------------------
   Total charge-offs                 56,629        82,436       113,141        92,224        71,188       60,225
- --------------------------------------------------------------------------------------------------------------------
Recoveries:
Commercial:
 Commercial, financial and
   industrial                         3,473         2,438         2,136         1,991         2,903        2,082
 Real estate commercial                  51           166            41           280           480          228
 Real estate construction                10             1             -             -             -            8
Retail:
 Real estate residential*             4,517         4,820         4,693         2,788           857          510
 Other retail                         4,211         5,653         6,419         4,953         3,937        3,725
 Credit card receivables              2,227         1,347         1,352         1,733         1,924        2,022
- --------------------------------------------------------------------------------------------------------------------
   Total recoveries                  14,489        14,425        14,641        11,745        10,101        8,575
- --------------------------------------------------------------------------------------------------------------------
   Net charge-offs                   42,140        68,011        98,500        80,479        61,087       51,650
- --------------------------------------------------------------------------------------------------------------------
Ending balance                  $   158,159   $   160,333   $   144,298   $   150,614   $   139,210   $  134,979
====================================================================================================================
Reserve for off-balance sheet
 commitments                    $     7,904   $     7,804   $     5,368   $     4,759   $     4,486   $    4,624
Total of allowance for loan
 losses and reserve for off-
 balance sheet commitments      $   166,063   $   168,137   $   149,666   $   155,373   $   143,696   $  139,603
- --------------------------------------------------------------------------------------------------------------------
LOANS AND COMMITMENTS:
Period end loans, net of
 unearned                       $16,427,673   $13,990,525   $11,345,445   $10,283,143   $10,239,450   $9,363,158
Insured loans                       665,909       862,675       785,270             -             -            -
- --------------------------------------------------------------------------------------------------------------------
Loans excluding insured loans   $15,761,764   $13,127,850   $10,560,175   $10,283,143   $10,239,450   $9,363,158
====================================================================================================================
Off-balance sheet
 commitments**                  $ 6,226,245   $ 5,464,097   $ 3,398,534   $ 2,895,681   $ 2,069,143   $1,679,237
- --------------------------------------------------------------------------------------------------------------------
Average loans, net of
 unearned                       $15,384,650   $12,656,318   $10,634,530   $10,104,277   $ 9,931,955   $8,818,766
- --------------------------------------------------------------------------------------------------------------------
RATIOS***:
Allowance to loans                      .96%         1.15%         1.27%         1.46%         1.36%        1.44%
Allowance to loans excluding
 insured loans                         1.00          1.22          1.37          1.46          1.36         1.44
Allowance to net charge-offs           3.75X         2.36x         1.46x         1.87x         2.28x        2.61x
Net charge-offs to average
 loans                                  .27           .54           .93           .80           .62          .59
- --------------------------------------------------------------------------------------------------------------------
</Table>

  * Real estate residential net charge-offs/(recoveries) include ($.1) million,
    $1.6 million, $3.6 million, $3.2 million, $5.2 million and $2.1 million of
    net charge-offs/(recoveries) for the years 2004 through 1999, respectively,
    related to loans classified as nonperforming from the warehouse and the
    repurchase of loans originated and previously sold by First Horizon Home
    Loans.
 ** Amount of off-balance sheet commitments for which a reserve has been
    provided. See Note 18  -  Restrictions, Contingencies, Commitments and Other
    Disclosures for further details on off-balance sheet commitments.
*** Net of unearned income.

First Horizon National Corporation     33





<Page>


TABLE 19 - LOANS AND FORECLOSED REAL ESTATE ON DECEMBER 31

<Table>
<Caption>
                                                             2004                                              2003
                             ---------------------------------------------------------------------  ---------------------------
                                          Construction                             %     Allowance              %     Allowance
                                              and        Commercial               of     for Loan              of     for Loan
(Dollars in millions)        Commercial   Development    Real Estate    TOTAL    Total    Losses     Total    Total    Losses
- -------------------------------------------------------------------------------------------------------------------------------
<S>                          <C>          <C>            <C>           <C>       <C>     <C>        <C>       <C>     <C>
Internal grades:
 1                             $  269        $    -         $  -       $   269      2%     $  1     $   276      2%     $  1
 2                                481             -           48           529      3         4         446      3         4
 3                                657             2           15           674      4         8         421      3         6
 4                              3,206           782          668         4,656     28        56       3,616     26        44
 5                                810           401          208         1,419      9        20       1,179      9        18
 6                                 55            11            8            74      1         3         106      1         4
 7                                 47             3            3            53      -         5          43      -         5
 8,9,10 (Classifieds)              15             -            5            20      -         3          40      -         9
- -------------------------------------------------------------------------------------------------------------------------------
                                5,540         1,199          955         7,694     47       100       6,127     44        91
Impaired loans:
 Contractually past due            19            10            5            34      -        10          32      -        10
 Contractually current              1             -            -             1      -         -           2      -         -
- -------------------------------------------------------------------------------------------------------------------------------
Total commercial and
 commercial real estate
 loans                          5,560         1,209          960         7,729     47       110       6,161     44       101
- -------------------------------------------------------------------------------------------------------------------------------
Retail:
 Real estate residential                                                 7,245     44        30       6,819     49        39
 Real estate construction                                                1,036      6         3         527      4         2
 Other retail                                                              169      1         5         212      1         5
 Credit card receivables                                                   249      2        10         272      2        13
- -------------------------------------------------------------------------------------------------------------------------------
 Total retail loans                                                      8,699     53        48       7,830     56        59
- -------------------------------------------------------------------------------------------------------------------------------
Total loans                                                            $16,428    100%     $158     $13,991    100%     $160
===============================================================================================================================
Foreclosed real estate:
 Commercial                    $   12        $    -         $  3       $    15                      $     9
 Retail                                                                      4                            5
 Mortgage banking                                                            9                           10
- -------------------------------------------------------------------------------------------------------------------------------
Total foreclosed real estate                                           $    28                      $    24
===============================================================================================================================
</Table>

<Table>
<S>        <C>
Loans are expressed net of unearned income. All amounts in the
Allowance for Loan Losses columns have been rounded to the nearest
million dollars. All data is based on internal loan classifications.
Certain previously reported amounts have been reclassified to agree
with current presentation. Definitions of each credit grade are
provided below:
Grade 1:   Firmly established, stable companies with excellent
           earnings, liquidity, and capital. Possess many of the same
           characteristics as Standard & Poor's (S&P) AA rated
           companies.
Grade 2:   Well-established, stable companies with good to very good
           earnings, liquidity, and capital. Possess many of the same
           characteristics as S&P A rated companies.
Grade 3:   Reasonably well-established, stable companies with above
           average to good earnings, liquidity, and capital and with
           consistent, positive trends relative to industry norms.
Grade 4:   Reasonably well-established, stable companies with average
           earnings, liquidity, and capital.
Grade 5:   New and established companies with some potential weakness.
           Capital considered less than average and history of average
           to below average earnings without consistent positive
           trends. Overall acceptable credits with minor weaknesses
           which warrant additional servicing.
Grade 6:   Financial condition adversely affected by temporary lack of
           earnings or liquidity or changes in the operating
           environment. An action plan is required to rehabilitate the
           credit or have it refinanced elsewhere.
Grade 7:   Significant developing weaknesses or adverse trends in
           earnings, liquidity, capital, or operating environment.
           Limited alternate financing is available.
Grade 8:   Significantly higher than normal probability that: (1) legal
           action will be required; (2) liquidation of collateral will
           be required; (3) there will be a loss; or all three will
           occur. This grade is believed to be substantially equivalent
           to the regulators' classification of substandard.
Grade 9:   Excessive degree of risk. Financial and management
           deficiencies are well defined and make the obligor's ability
           to repay from anticipated sources under existing terms and
           conditions uncertain. Collateral shortfall and/or
           undeterminable collateral values exist. Timing and amount of
           loss are uncertain. This grade is believed to be
           substantially equivalent to the regulators' classification
           of doubtful.
Grade 10:  Borrowers are deemed incapable of repayment and debt is
           deemed uncollectible. Loans should no longer be carried as
           an active bank asset. This grade is believed to be
           substantially equivalent to the regulators' classification
           of loss.
Impaired:  A loan for which it is probable that all amounts due,
           according to the contractual terms of the loan agreement,
           will not be collected and the loan is placed on non-accrual
           status. Reserves for impaired loans are based on the value
           of the collateral or the cash flow of the entity compared to
           the outstanding balance.
</Table>

                                       34     First Horizon National Corporation





<Page>


COMPONENTS OF THE ALLOWANCE FOR LOAN LOSSES

The allowance for loan losses is composed of the following components: reserves
for individually impaired commercial loans, reserves for commercial loans
evaluated based on pools of credit graded loans, and reserves for pools of
smaller-balance homogeneous retail and commercial loans. Reserves for
individually impaired commercial loans are computed in accordance with SFAS
No. 114, and are based on either the estimated collateral value less selling
costs (if the loan is a collateral dependent loan), or the present value of
expected future cash flows discounted at the loan's effective interest rate.
Reserves for commercial loans evaluated based on pools of credit graded loans
and reserves for pools of smaller-balance homogeneous retail and commercial
loans are determined in accordance with SFAS No. 5. The reserve factors applied
to these pools are an estimate of probable incurred losses based on management's
evaluation of historical losses from loans with similar characteristics,
adjusted for current economic factors and trends. Table 19 gives a breakdown of
the allowance allocation by major loan types and commercial loan grades on
December 31, 2004, compared with December 31, 2003.

To assess the quality of individual commercial loans, all commercial loans are
internally assigned a credit grading, ranging from grades 1 to 10. The credit
grading system is intended to identify and measure the credit quality of lending
relationships by analyzing the migration of loans between grading categories. It
is also integral to the estimation methodology utilized in determining the
allowance for loan losses since an allowance is established for pools of
commercial loans based on the credit grade assigned. The appropriate
relationship manager performs the process of classifying commercial loans into
the appropriate credit grades initially as a component of the approval of the
loan and has responsibility for insuring that the loan is properly graded
throughout the life of the loan. The proper loan grade for all commercial loans
in excess of $1 million is confirmed by a senior credit officer in the approval
process. To determine the most appropriate credit grade for each loan, based on
the size of the loan, credit officers examine and consider both financial and
non-financial data as discussed in the credit grade definitions disclosed in
Table 19. Loan grades are frequently reviewed by commercial loan review to
determine if any changes in the circumstances of the loan require a different
risk grade.

A reserve rate is established for each loan grade based on a historical
three-year moving average of actual charge-offs. The reserve rate is then
adjusted for current events, trends, and economic conditions that affect the
asset quality of the loan portfolio. Some of the factors considered in making
these adjustments include: levels of and trends in delinquencies; classified
loans and nonaccrual loans; trends in outstandings and maturities; effects of
changes in lending policies and underwriting guidelines; introduction of new
loan products with different risk characteristics; experience, ability and depth
of lending management and staff; migration trends of loan grades; and charge-off
trends that may skew the historical three-year moving average. Finally, the
reserve rates for each loan grade are reviewed quarterly to reflect local,
regional and national economic trends; concentrations of cyclical industries;
and the economic prospects for industry concentrations. To supplement
management's process in setting these additional adjustments, an economic model
is used that evaluates the correlation between historical charge-offs and a
number of state and national economic indicators. Also, all classified loans $1
million and greater are reviewed individually in accordance with SFAS No. 114,
and a specific reserve is set based on the exposure (the difference between the
outstanding loan amount and either the present value of expected future cash
flows or the estimated net realizable value of the collateral) and the
probability of loss.

Table 20 shows the reserve rates (percentage of allowance for loan losses to
outstanding balances) by loan category. The average reserve rate for all
commercial loans decreased to 1.30 percent in 2004 from 1.49 percent in 2003 and
1.29 percent in 2002. This decrease is due to improvement in watch list and
classified loans and improvement in commercial economic factors.

First Horizon National Corporation     35





<Page>


TABLE 20 - AVERAGE RESERVE RATES

<Table>
<Caption>
                                       LOANS            Loans            Loans            Loans            Loans
                                       % OF             % of             % of             % of             % of
                               2004    TOTAL    2003    Total    2002    Total    2001    Total    2000    Total
- ----------------------------------------------------------------------------------------------------------------
<S>                           <C>      <C>     <C>      <C>     <C>      <C>     <C>      <C>     <C>      <C>
Commercial, commercial real
 estate and commercial
 construction*                  1.30%  46.9      1.49%  43.8      1.29%  50.0      1.31%  54.1      1.29%  51.6
Impaired                       28.57     .2     29.41     .2     30.61     .5     44.74     .4     36.59     .4
Retail real estate               .40   50.4       .56   52.5       .77   44.6       .99   38.3       .69   36.7
Other retail                    2.96    1.0      2.35    1.5      1.05    2.5      1.96    4.5      1.67    8.2
Credit card receivables         4.02    1.5      4.76    2.0      5.13    2.4      4.63    2.7      5.02    3.1
- ----------------------------------------------------------------------------------------------------------------
</Table>

* Excludes impaired loans.

The allowance for loan losses for smaller-balance homogenous loans (retail
loans) is determined based on pools of similar loan types that have similar
credit risk characteristics, which is consistent with industry practice. FHN
manages retail loan credit risk on a portfolio basis. Reserve rates are
established for each segment of the retail loan portfolio based on historical
loss experience and are adjusted to reflect current events, trends and economic
conditions. Some of the factors for making these adjustments include: changes in
underwriting guidelines or credit scoring models; trends in consumer payment
patterns, delinquencies and personal bankruptcies; changes in the mix of loan
products outstanding; experience, ability and depth of lending management and
staff; value of underlying collateral; and charge-off trends.

The average reserve rate for retail real estate loans was .40 percent in 2004 as
compared to .56 percent in 2003 and .77 percent in 2002. The decrease in the
retail real estate loan reserve rate for 2004 was impacted primarily by the
improvement in the retail loan portfolio's risk profile. The reserve rate for
other retail loans, a diminishing portfolio of loans which represented only 1
percent of total loans in 2004, increased to 2.96 percent in 2004 from 2.35
percent in 2003 primarily due to the changing risk profile of this mature
portfolio of loans. The other retail loans reserve rate was 1.05 percent in
2002. The average reserve rate for credit card receivables improved to 4.02
percent in 2004 from 4.76 percent in 2003 due to the transfer of a portfolio of
credit card receivables to held for sale.

NONPERFORMING ASSETS

Nonperforming loans consist of impaired, other nonaccrual and restructured
loans. These, along with foreclosed real estate and other assets, represent
nonperforming assets. Impaired loans are those loans for which it is probable
that all amounts due, according to the contractual terms of the loan agreement,
will not be collected and for which recognition of interest income has been
discontinued. Other nonaccrual loans are residential and other retail loans on
which recognition of interest income has been discontinued. Restructured loans
generally take the form of an extension of the original repayment period and/or
a reduction or deferral of interest or principal because of deterioration in the
financial position of the borrower.

Overall, nonperforming assets remained stable, totaling $77.3 million on
December 31, 2004, compared to $76.2 million on December 31, 2003. Nonperforming
assets in retail/commercial banking were $65.2 million for 2004 compared to
$62.9 million for 2003. However, the retail/commercial banking nonperforming
assets ratio decreased to .40 percent from .45 percent as loans increased 17
percent. The increase in nonperforming assets is primarily due to higher levels
of foreclosed real estate which is indicative of FHN's greater exposure in real
estate lending. Mortgage banking nonperforming assets were also stable at $12.1
million for 2004 compared to $13.3 million for 2003.

Information regarding nonperforming assets and past-due loans is presented in
Table 22. Table 21 gives additional information related to changes in
nonperforming assets for 2002 through 2004.

                                       36     First Horizon National Corporation





<Page>


TABLE 21 - CHANGES IN NONPERFORMING ASSETS

<Table>
<Caption>
(Dollars in millions)                                                                  2004        2003       2002
- ------------------------------------------------------------------------------------------------------------------------
<S>                                              <C>         <C>         <C>         <C>         <C>         <C>
Beginning balance                                                                    $   76.2    $   75.7    $  85.1
Additional nonperforming assets                                                          77.0       111.0      165.5
Payments, sales and other dispositions                                                  (61.9)      (88.2)    (130.6)
Charge-offs                                                                             (14.0)      (22.3)     (44.3)
- ------------------------------------------------------------------------------------------------------------------------
Ending balance                                                                       $   77.3    $   76.2    $  75.7
========================================================================================================================
</Table>

TABLE 22 - NONPERFORMING ASSETS ON DECEMBER 31

<Table>
<Caption>
(Dollars in thousands)                             2004        2003        2002        2001        2000       1999
- ------------------------------------------------------------------------------------------------------------------------
<S>                                              <C>         <C>         <C>         <C>         <C>         <C>
RETAIL/COMMERCIAL BANKING:
Nonperforming loans*                             $ 41,102    $ 43,228    $ 58,454    $ 41,671    $ 41,541    $ 7,789
Foreclosed real estate                             24,092      19,365       8,188       9,924       3,997      5,777
Other assets                                            -         336          33         130          97         91
- ------------------------------------------------------------------------------------------------------------------------
   Total Retail/Commercial Banking                 65,194      62,929      66,675      51,725      45,635     13,657
- ------------------------------------------------------------------------------------------------------------------------
MORTGAGE BANKING:
Nonperforming loans                                 8,458       8,556       5,733      21,285      19,761     21,329
Foreclosed real estate                              3,686       4,710       3,263      12,065      12,293     12,093
- ------------------------------------------------------------------------------------------------------------------------
   Total Mortgage Banking                          12,144      13,266       8,996      33,350      32,054     33,422
- ------------------------------------------------------------------------------------------------------------------------
Total nonperforming assets                       $ 77,338    $ 76,195    $ 75,671    $ 85,075    $ 77,689    $47,079
========================================================================================================================
Loans 30 to 89 days past due**                   $120,306    $152,481    $104,084    $117,298    $105,705    $88,389
Guaranteed portion of loans 30 to 89 days
 past due**                                        44,415      62,955       3,202       4,388      19,966     21,698
Loans 90 days past due**                          213,596     226,194      37,083      37,665      42,606     29,849
Guaranteed portion of loans 90 days past
 due**                                            185,353     204,574       5,986       6,076      16,987     11,180
Potential problem assets***                       100,000     119,083     128,657     123,535     107,605     75,001
- ------------------------------------------------------------------------------------------------------------------------
RATIOS:
Allowance to nonperforming loans in the loan
 portfolio                                            385%        371%        247%        239%        227%       464%
Nonperforming assets to loans, foreclosed
 real estate and other assets
 (Retail/Commercial Banking)                          .40         .45         .59         .50         .45        .15
Nonperforming assets to unpaid principal
 balance of servicing portfolio (Mortgage
 Banking)                                             .01         .02         .02         .07         .07        .07
- ------------------------------------------------------------------------------------------------------------------------
</Table>

  * Total impaired loans included in nonperforming loans were $34.8 million,
    $34.4 million, $49.3 million, $37.8 million, $41.2 million and $7.5 million
    for the years 2004 through 1999, respectively.
 ** Prior to 2003 government guaranteed loans repurchased through GNMA's
    repurchase program were classified as receivables in 'Capital markets
    receivables and other assets' on the Consolidated Statements of Condition
    and are not included in past due loan statistics. Guaranteed loans include
    FHA, VA, student and GNMA loans repurchased under the repurchase program.
*** Includes loans and leases 90 days past due exclusive of guaranteed loans
    obtained through the GNMA repurchase program.
Certain previously reported amounts have been reclassified to agree with current
presentation.

PAST DUE LOANS AND POTENTIAL PROBLEM ASSETS

Past due loans are loans contractually past due 90 days or more as to interest
or principal payments, but which have not yet been put on nonaccrual status.
Past due loans excluding guaranteed loans increased $6.6 million in 2004 to
$28.2 million. However, while these total past due balances increased, the ratio
of past due loans in the loan portfolio to total loans was relatively flat at
..21 percent on December 31, 2004 compared to .19 percent on December 31, 2003.
In addition, loans 30 to 89 days past due, excluding guaranteed loans decreased
$13.6 million to $75.9 million while the ratio of loans 30 to 89 days past due
in the loan portfolio improved to .47 percent of total loans on December 31,
2004 compared to .66 percent on December 31, 2003. Additional historical past
due loan information can be found in Table 22.

First Horizon National Corporation     37





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Potential problem assets in the loan portfolio, which are not included in
nonperforming assets, decreased to $100.0 million, or .61 percent of total
loans, on December 31, 2004, from $119.1 million, or .85 percent of total loans,
on December 31, 2003. Potential problem assets represent those assets where
information about possible credit problems of borrowers has caused management to
have serious doubts about the borrower's ability to comply with present
repayment terms. This definition is believed to be substantially consistent with
the standards established by the Office of the Comptroller of the Currency for
loans classified substandard.

MORTGAGE BANKING

First Horizon Home Loans originates mortgage loans through its retail and
wholesale operations and also purchases mortgage loans from third-party mortgage
bankers (known as correspondent brokers) for sale to secondary market investors
and subsequently services the majority of those loans. The secondary market for
mortgages allows First Horizon Home Loans to sell mortgage loans to investors,
including GSE, such as FNMA, FHLMC and GNMA. Many private investors are also
active in the secondary market as issuers and investors. The majority of First
Horizon Home Loans' mortgage loans are sold through transactions with GSE. The
risk of credit loss with regard to the principal amount of the loans sold is
generally transferred to investors upon sale to the secondary market. To the
extent that transferred mortgage loans are subsequently determined not to meet
the agreed-upon qualifications or criteria, the purchaser has the right to
return those loans to First Horizon Home Loans. In addition, certain mortgage
loans are sold to investors with limited or full recourse in the event of
mortgage foreclosure (refer to discussion of foreclosure reserves under Critical
Accounting Policies).

OPERATIONAL RISK MANAGEMENT

Operational risk is the risk of loss from inadequate or failed internal
processes, people, and systems or from external events. This risk is inherent in
all businesses. Management, measurement, and reporting of operational risk are
overseen by the Operational Risk Committee, which is chaired by the EVP of Risk
Management. Key representatives from the business segments, legal, shared
services, risk management, and insurance are represented on the committee.
Subcommittees manage and report on business continuity planning, data security,
insurance, compliance, records management, product and system development and
reputation risks. Summary reports of the committee's activities and decisions
are provided to the Enterprise-wide Risk/Return Management Committee.
Significant emphasis is dedicated to refinement of processes and tools to aid in
measuring and managing material operational risks and providing for a culture of
awareness and accountability.

CRITICAL ACCOUNTING POLICIES

APPLICATION OF CRITICAL ACCOUNTING POLICIES AND ESTIMATES

FHN's accounting policies are fundamental to understanding management's
discussion and analysis of financial condition and results of operations. The
consolidated financial statements of FHN are prepared in conformity with
accounting principles generally accepted in the United States of America and
follow general practices within the industries in which it operates. The
preparation of the financial statements requires management to make certain
judgments and assumptions in determining accounting estimates. Accounting
estimates are considered critical if (a) the estimate requires management to
make assumptions about matters that were highly uncertain at the time the
accounting estimate was made, and (b) different estimates reasonably could have
been used in the current period, or changes in the accounting estimate are
reasonably likely to occur from period to period, that would have a material
impact on the presentation of FHN's financial condition, changes in financial
condition or results of operations.

It is management's practice to discuss critical accounting policies with the
Board of Directors' Audit Committee including the development, selection and
disclosure of the critical accounting estimates. Management believes the
following critical accounting policies are both important to the portrayal of
the company's financial condition and results of operations and require
subjective or complex

                                       38     First Horizon National Corporation





<Page>


judgments. These judgments about critical accounting estimates are based on
information available as of the date of the financial statements.

MORTGAGE SERVICING RIGHTS AND OTHER RELATED RETAINED INTERESTS

When First Horizon Home Loans sells mortgage loans in the secondary market to
investors, it generally retains the right to service the loans sold in exchange
for a servicing fee that is collected over the life of the loan as the payments
are received from the borrower. An amount is capitalized as MSR on the
Consolidated Statements of Condition based on the expected present value of the
anticipated cash flows received for servicing the loan, net of the estimated
costs of servicing the loan. During 2004, First Horizon Home Loans originated or
purchased $438.0 million of MSR in connection with sales of first-lien mortgage
loans in the secondary market and acquisition of servicing rights from third
parties compared to $536.7 million in 2003. On December 31, 2004 and 2003, the
total outstanding principal amount of First Horizon Home Loans' first-lien
servicing portfolio aggregated $86.6 billion and $68.9 billion, respectively.

MSR ESTIMATED FAIR VALUE

The fair value of MSR typically rises as market interest rates increase and
declines as market interest rates decrease; however, the extent to which this
occurs depends in part on (1) the magnitude of changes in market interest rates,
and (2) the differential between the then current market interest rates for
mortgage loans and the mortgage interest rates included in the mortgage
servicing portfolio.

Since sales of MSR tend to occur in private transactions and the precise terms
and conditions of the sales are typically not readily available, there is a
limited market to refer to in determining the fair value of MSR. As such, like
other participants in the mortgage banking business, First Horizon Home Loans
relies primarily on a discounted cash flow model to estimate the fair value of
its MSR. This model calculates estimated fair value of the MSR using numerous
tranches of MSR, which share similar key characteristics, such as interest
rates, type of product (fixed vs. variable), age (new, seasoned, moderate),
agency type and other factors. First Horizon Home Loans uses assumptions in the
model that it believes are comparable to those used by other participants in the
mortgage banking business and reviews estimated fair values and assumptions with
third-party brokers and other service providers on a quarterly basis. First
Horizon Home Loans also compares its estimates of fair value and assumptions to
recent market activity and against its own experience.

Estimating the cash flow components of net servicing income from the loan and
the resultant fair value of the MSR requires First Horizon Home Loans to make
several critical assumptions based upon current market and loan production data.

Prepayment speeds: Generally, when market interest rates decline and other
factors favorable to prepayments occur there is a corresponding increase in
actual and expected borrower prepayments as customers refinance existing
mortgages under more favorable interest rate terms. When a mortgage loan is
prepaid, or is expected to prepay faster than originally expected, the
anticipated cash flows associated with servicing that loan are terminated or
reduced, resulting in a reduction, or impairment, to the fair value of the
capitalized MSR. To estimate prepayment speeds, First Horizon Home Loans
utilizes a third-party prepayment model, which is based upon statistically
derived data linked to certain key principal indicators involving historical
borrower prepayment activity associated with mortgage loans in the secondary
market, current market interest rates and other factors. For purposes of model
valuation, estimates are made for each product type within the MSR portfolio on
a monthly basis.

Discount rate: Represents the rate at which the expected cash flows are
discounted to arrive at the net present value of servicing income. Estimated
discount rates will change with market conditions (i.e., supply vs. demand) and
be reflective of the yields expected to be earned by market participants
investing in MSR.

Cost to service: Expected costs to service are estimated based upon the costs
that a market participant would use in evaluating the potential acquisition of
MSR.

First Horizon National Corporation     39





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Float income: Estimated float income is driven by expected float balances
(principal and interest payments that are held pending remittance to the
investor) and current market interest rates, including the thirty-day London
Inter-Bank Offered Rate (LIBOR) and five-year swap interest rates, which are
updated on a monthly basis for purposes of estimating the fair market value of
MSR.

First Horizon Home Loans engages in a process referred to as 'price discovery'
on a monthly basis to assess the reasonableness of the estimated fair value of
MSR. Price discovery is conducted through a process of obtaining the following
information: (a) monthly informal valuation of the servicing portfolio by a
prominent mortgage-servicing broker, and (b) a collection of surveys and
benchmarking data available through third party participants in the mortgage
banking business. Although there is no single source of market information that
can be relied upon to assess the fair value of MSR, First Horizon Home Loans
reviews all information obtained during price discovery to determine whether the
estimated fair value of MSR is reasonable when compared to market information.
On December 31, 2004, 2003 and 2002, based upon the information obtained through
price discovery, First Horizon Home Loans determined that its MSR valuations and
assumptions were reasonable based on the price discovery process.

The First Horizon Risk Management Committee (FHRMC) submits the overall
assessment of the estimated fair value of MSR monthly for review. The FHRMC is
responsible for approving the critical assumptions used by management to
determine the estimated fair value of First Horizon Home Loans' MSR. Each
quarter, FHN's MSR Committee reviews the initial capitalization rates for newly
originated MSR and the analysis of value impairment related to the total
servicing portfolio. In addition, the Executive Committee of FHN's board of
directors reviews the initial capitalization rates and approves the amortization
expense.

MSR are included on the Consolidated Statements of Condition, net of accumulated
amortization. The changes in fair value of MSR are included as a component of
Mortgage Banking  - Noninterest Income on the Consolidated Statements of Income.

HEDGING THE FAIR VALUE OF MSR ON FIRST-LIEN MORTGAGES

In order to provide protection from a decline in the fair value of MSR due to
changes in the benchmark interest rate, First Horizon Home Loans employs a
hedging strategy. This strategy uses derivative financial instruments expected
to change in fair value in response to changes in a certain benchmark interest
rate (specifically, the 10-year LIBOR) in amounts, which will substantially
offset the change in fair value of certain MSR. On December 31, 2004 and 2003,
hedged MSR approximated 98 percent and 95 percent of the total MSR portfolio, as
measured on a dollar at risk basis.

In order to substantially hedge the change in fair value of the hedged MSR,
First Horizon Home Loans generally maintains a coverage ratio (the ratio of
expected change in fair value of derivatives to expected change in fair value of
MSR) approximating 100 percent of the hedged MSR portfolio. As noted above, to
the extent that actual borrower prepayments do not react as anticipated by the
prepayment model (i.e., the historical data observed in the model does not
correspond to actual market activity), it is possible that the prepayment model
could fail to accurately predict mortgage prepayments and could result in
significant earnings volatility. Pursuant to SFAS No. 133, in any hedge period
the difference between the change in fair value of the hedged MSR, attributed to
the change in the benchmark interest rate, and the change in fair value of the
derivatives used to hedge the change in fair value of the MSR is recognized as
gains or losses in current earnings. First Horizon Home Loans generally attempts
to hedge 100 percent of the exposure to a change in the fair value of the hedged
MSR attributed to a change in the benchmark interest rate, which requires a
regular assessment of the amount of derivative financial instruments required to
maintain a 100 percent hedge ratio.

Certain components of the fair value of derivatives used to hedge certain MSR
are excluded from the assessment of hedge effectiveness. Although those amounts
are excluded from the assessment of hedge effectiveness, they are included as a
component of current earnings in the Consolidated

                                       40     First Horizon National Corporation





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Statements of Income. The derivative financial instruments used to hedge the
change in fair value of hedged MSR primarily include forward contracts, interest
rate swaps and swaptions.

First Horizon Home Loans generally experiences increased loan origination and
production in periods of low interest rates, which at the time of sale, result
in the capitalization of new MSR associated with new production. This provides
for a 'natural hedge' in the mortgage banking business cycle. The 'replenishment
rate' during 2004  - meaning the ratio of new loan volume originated for every
existing customer mortgage loan that prepays  - was approximately 175 percent,
which includes the retention of existing First Horizon Home Loans' customers who
prepay their mortgage loans. First Horizon Home Loans capitalized $438.0 million
of MSR during 2004. New production and origination does not prevent First
Horizon Home Loans from recognizing impairment expense on existing servicing
rights as a result of prepayments; rather, the new production volume results in
loan origination fees and the capitalization of MSR as a component of realized
gains related to the sale of such loans in the secondary market, thus the
'natural hedge' which tends to offset a portion of the MSR impairment charges
during a period of low interest rates. In a period of increased borrower
prepayments, impairment can be significantly offset by a strong replenishment
rate and strong net margins on new loan originations. To the extent that First
Horizon Home Loans is unable to maintain a strong replenishment rate, or in the
event that the net margin on new loan originations declines from historical
experience, the value of the natural hedge may diminish, thereby significantly
impacting the results of operations in a period of increased borrower
prepayments.

First Horizon Home Loans does not specifically hedge the change in fair value of
MSR attributed to other risks, including unanticipated prepayments (representing
the difference between actual prepayment experience and estimated prepayments
derived from the model, as described above), basis risk (meaning, the risk that
changes in the benchmark interest rates may not correlate to changes in the
mortgage market interest rates), discount rates, cost to service and other
factors. To the extent that these other factors result in changes to the fair
value of MSR, First Horizon experiences volatility in current earnings due to
the fact that these risks are not currently hedged.

ACTUAL VS. ESTIMATED MSR CRITICAL ASSUMPTIONS

As discussed above, the estimate of the cash flow components of net servicing
income associated with MSR requires management to make several critical
assumptions based upon current market and loan production data, including
prepayment speeds, discount rate, cost to service and float income. Inherent in
estimating such assumptions are uncertainties associated with the mortgage
banking business (primarily, the change in market interest rates which vary
significantly due to multiple economic and non-economic factors) as well as the
composition of the MSR portfolio, which is not static and changes significantly
based upon the production and sale of new loans, customer prepayment experience
and other factors. As a result, the estimated assumptions used to value MSR  -
particularly the estimate of prepayment speeds  - can vary significantly from
actual experience, resulting in the recognition of additional impairment charges
in current earnings. Table 23 provides a summary of actual and
estimated-weighted average prepayment speeds and float income used in
determining the estimated fair value of MSR for the years ended December 31,
2004, 2003 and 2002. Although the estimates of discount rates and cost to
service assumptions used in determining the estimated fair value of MSR can vary
from actual experience, such differences have not been material for the years
ended December 31, 2004, 2003, and 2002.

During 2004, 2003 and 2002, impairment charges associated with MSR of $37.1
million, $158.3 million and $150.2 million, respectively, were recognized, which
were principally associated with differences between actual and estimated
prepayment speeds and other factors, including basis risk associated with
benchmark interest rates and actual float income earnings. The decrease in value
of MSR was partially offset by an increase in fair value of the derivative
financial instruments used to hedge the change in fair value of the hedged MSR.

Table 23 summarizes First Horizon Home Loans' MSR activity and critical
assumptions for the years ended December 31, 2004, 2003 and 2002.

First Horizon National Corporation     41





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TABLE 23 - MORTGAGE BANKING MSR ACTIVITY AND CRITICAL ASSUMPTIONS

<Table>
<Caption>
(Dollars in millions)                                          2004      2003       2002
- ------------------------------------------------------------------------------------------
<S>                                                           <C>       <C>       <C>
Mortgage servicing income                                     $ 230.4   $ 186.7   $ 168.0
Originated and purchased mortgage servicing rights, net         438.0     530.4     401.9
Amortization                                                   (152.7)   (132.3)   (117.8)
Impairment                                                      (37.1)   (158.3)   (150.2)
MSR hedge ineffectiveness, net*                                  47.9     115.2     100.8
- ------------------------------------------------------------------------------------------
Prepayment speeds
 Actual                                                          27.8%     55.3%     42.7%
 Estimated**                                                     23.8      67.0      42.9
Float income
 Actual                                                       $  30.8   $  35.1   $  41.7
 Estimated                                                       22.5      40.0      36.8
- ------------------------------------------------------------------------------------------
</Table>

 * MSR hedge ineffectiveness is expressed net of time decay of MSR hedges.
** Estimated prepayment speeds represent monthly average prepayment speed
   estimates for each of the years presented.

INTEREST-ONLY CERTIFICATES FAIR VALUE  -  RESIDENTIAL MORTGAGE LOANS

Consistent with MSR, the fair value of an interest-only certificate typically
rises as market interest rates increase and declines as market interest rates
decrease. Additionally, similar to MSR, the market for interest-only
certificates is limited, and the precise terms of transactions involving
interest-only certificates are not typically readily available. Accordingly,
First Horizon Home Loans relies primarily on a discounted cash flow model to
estimate the fair value of its interest-only certificates.

Estimating the cash flow components and the resultant fair value of the
interest-only certificates requires First Horizon Home Loans to make certain
critical assumptions based upon current market and loan production data. The
primary critical assumptions used by First Horizon Home Loans to estimate the
fair value of interest-only securities include prepayment speeds and discount
rates, as discussed above. First Horizon Home Loans' interest-only certificates
are included as a component of trading securities on the Consolidated Statements
of Condition, with realized and unrealized gains and losses included in current
earnings as a component of mortgage banking income on the Consolidated
Statements of Income.

HEDGING THE FAIR VALUE OF INTEREST-ONLY CERTIFICATES

First Horizon Home Loans employs an economic hedging strategy for interest-only
certificates, which uses derivative financial instruments expected to change in
fair value in response to changes in a certain benchmark interest rate
(specifically, the 10-year LIBOR) in amounts which will substantially offset the
change in fair value of certain interest-only certificates. Realized and
unrealized gains and losses associated with the change in fair value of
derivatives used in the economic hedge of interest-only securities are included
in current earnings on the Consolidated Statements of Income. The extent to
which the change in fair value of interest-only securities is offset by the
change in fair value of the derivatives used to hedge these instruments depends
primarily on the hedge coverage ratio maintained by First Horizon Home Loans.
Also, as noted above, to the extent that actual borrower prepayments do not
react as anticipated by the prepayment model (i.e., the historical data observed
in the model does not correspond to actual market activity), it is possible that
the prepayment model could fail to accurately predict mortgage prepayments,
which could significantly impact First Horizon Home Loans' ability to
effectively hedge certain components of the change in fair value of
interest-only certificates and could result in significant earnings volatility.
The derivative financial instruments used to hedge the change in fair value of
hedged interest-only certificates primarily include forward contracts, interest
rate swaps and swaptions.

                                       42     First Horizon National Corporation





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RESIDUAL-INTEREST CERTIFICATES FAIR VALUE  -  HELOC AND SECOND-LIEN MORTGAGES

The fair value of a residual-interest certificate typically changes based on the
differences between modeled prepayment speeds and credit losses and actual
experience. Additionally, similar to MSR and interest-only certificates, the
market for residual-interest certificates is limited, and the precise terms of
transactions involving residual-interest certificates are not typically readily
available. Accordingly, FHN relies primarily on a discounted cash flow model to
estimate the fair value of its residual-interest certificates.

Estimating the cash flow components and the resultant fair value of the
residual-interest certificates requires FHN to make certain critical assumptions
based upon current market and loan production data. The primary critical
assumptions used by FHN to estimate the fair value of residual-interest
securities include prepayment speeds, credit losses and discount rates, as
discussed above. FHN's residual-interest certificates are included as a
component of trading securities on the Consolidated Statements of Condition,
with realized and unrealized gains and losses included in current earnings as a
component of other income on the Consolidated Statements of Income.

PIPELINE AND WAREHOUSE

During the period of loan origination, and prior to the sale of mortgage loans
in the secondary market, First Horizon Home Loans has exposure to mortgage loans
that are in the 'mortgage pipeline' and the 'mortgage warehouse'. The mortgage
pipeline consists of loan applications that have been received, but have not yet
closed as loans. Pipeline loans are either 'floating' or 'locked'. A floating
pipeline loan is one on which an interest rate has not been locked by the
borrower. A locked pipeline loan is one on which the potential borrower has set
the interest rate for the loan by entering into an interest rate lock commitment
resulting in interest rate risk to First Horizon Home Loans. Once a mortgage
loan is closed and funded, it is included within the mortgage warehouse, or the
'inventory' of mortgage loans that are awaiting sale and delivery (currently an
average of approximately 30 days) into the secondary market. First Horizon Home
Loans is exposed to credit risk while a mortgage loan is in the warehouse.

An interest rate lock commitment binds First Horizon Home Loans to lend funds to
the potential borrower at the set interest rate, which expires on a fixed date
regardless of whether or not interest rates change in the market. Interest rate
lock commitments generally have a term of up to 60 days before the closing of
the loan. The interest rate lock commitment, however, does not bind the
potential borrower to entering into the loan, nor does it guarantee that First
Horizon Home Loans will approve the potential borrower for the loan. Therefore,
First Horizon Home Loans makes estimates of expected 'fallout' (locked pipeline
loans not expected to close), using models, which consider cumulative historical
fallout rates and other factors. Fallout can occur for a variety of reasons
including falling rate environments when a borrower will abandon an interest
rate lock commitment at one lender and enter into a new lower interest rate lock
commitment at another, when a borrower is not approved as an acceptable credit
by the lender, or for a variety of other non-economic reasons. Note that once a
loan is closed, the risk of fallout is eliminated and the associated mortgage
loan is included in the mortgage loan warehouse. Under SFAS No. 133, interest
rate lock commitments qualify as derivative financial instruments and,
therefore, the changes in fair value of interest rate lock commitments are
included in current earnings in the Consolidated Statements of Income. Third
party models are also used to manage interest rate risk related to price
movements on loans in the pipeline and the warehouse.

For periods ending before April 1, 2004, like other participants in the mortgage
banking business, First Horizon Home Loans relied primarily on an internal
valuation model and one of several industry valuation techniques to estimate the
fair value of interest rate lock commitments and the mortgage warehouse. This
model calculated the estimated fair value using tranches of mortgage loans that
are determined to share similar price behavior, which is determined by
historical relationships of various product types, terms and interest rates. For
purposes of determining the market values for forward commitments to sell
mortgage loans in the secondary market, First Horizon Home Loans obtained market
prices from independent third parties, which represent actual trade activity in
the secondary

First Horizon National Corporation     43





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market. For purposes of determining the fair value of interest rate lock
commitments, management utilized the median broker price information obtained in
the secondary market, resulting in an asset with an estimated fair value of
$21.3 million on December 31, 2003.

For the period after March 31, 2004, the valuation model utilized to estimate
the fair value of interest rate lock commitments assumes a zero fair value on
the date of the lock with the borrower. Subsequent to the lock date, the model
calculates the change in value due solely to the change in interest rates
resulting in an asset with an estimated fair value of $16.5 million on
December 31, 2004.

To hedge against changes in fair value of the mortgage pipeline and warehouse
due to changes in interest rates, First Horizon Home Loans utilizes various
derivative financial instruments, which management expects will experience
changes in fair value opposite to the change in fair value of the loans in the
pipeline and warehouse, thus minimizing earnings volatility. The instruments and
techniques used to hedge the pipeline and warehouse include forward sales
commitments and other interest rate derivatives. The extent to which First
Horizon Home Loans is able to economically hedge changes in the mortgage
pipeline depends largely on the hedge coverage ratio that is maintained relative
to mortgage loans in the pipeline. The hedge coverage ratio can change
significantly due to changes in market interest rates and the associated forward
commitment prices for sales of mortgage loans in the secondary market. Increases
or decreases in the hedge coverage ratio can result in significant earnings
volatility to FHN. First Horizon Home Loans does not specifically hedge the
change in fair value of the mortgage pipeline attributed to other risks,
including basis risk and other factors.

FORECLOSURE RESERVES

As discussed above, First Horizon Home Loans typically originates mortgage loans
with the intent to sell those loans to GSE and other private investors in the
secondary market. Certain of the mortgage loans are sold with limited or full
recourse in the event of foreclosure. On December 31, 2004 and 2003, $3.4
billion and $3.7 billion of mortgage loans were outstanding which were sold
under limited recourse arrangements. On December 31, 2004 and 2003, $150.8
million and $199.3 million of mortgage loans were outstanding which were sold
under full recourse arrangements.

Loans sold with limited recourse include loans sold under government guaranteed
mortgage loan programs including Department of Housing and Urban Development
(HUD), Federal Housing Administration (FHA) and Veterans Administration (VA).
First Horizon Home Loans continues to absorb limited risk of credit losses in
the event of foreclosure of the mortgage loan sold. Generally, the amount of
recourse liability in the event of foreclosure is determined based upon the
respective government program and/or the sale or disposal of the foreclosed
property collateralizing the mortgage loan. Another instance of limited recourse
is the VA/No bid. In this case, the VA guarantee is limited and First Horizon
Home Loans may be required to fund any deficiency in excess of the VA guarantee
if the loan goes to foreclosure.

Loans sold with full recourse generally include mortgage loans sold to investors
in the secondary market which are uninsurable under government guaranteed
mortgage loan programs, due to issues associated with underwriting activities,
documentation or other concerns.

Management closely monitors historical experience, borrower payment activity,
current economic trends and other risk factors, and establishes a reserve for
foreclosure losses for loans sold with limited and full recourse which
management believes is sufficient to cover incurred foreclosure losses in the
portfolio. The reserve for foreclosure losses is based upon a historical
progression model using a rolling 12-month average, which predicts the
probability or frequency of a mortgage loan entering foreclosure. In addition,
other factors are considered, including qualitative and quantitative factors
(e.g., current economic conditions, past collection experience, risk
characteristics of the current portfolio and other factors), which are not
defined by historical loss trends or severity of losses. Table 24 provides a
summary of reserves for foreclosure losses for the years ended December 31,
2004, 2003 and 2002.

                                       44     First Horizon National Corporation





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TABLE 24 - RESERVES FOR FORECLOSURE LOSSES

<Table>
<Caption>
(Dollars in millions)                                          2004        2003        2002
- --------------------------------------------------------------------------------------------
<S>                                                           <C>         <C>         <C>
Beginning balance                                             $ 22.3      $ 33.0      $ 25.2
Provision for foreclosure losses                                 3.6        10.0        19.1
Charge-offs                                                    (11.4)      (22.7)      (17.5)
Recoveries                                                       4.0         2.0         6.2
- --------------------------------------------------------------------------------------------
Ending balance                                                $ 18.5      $ 22.3      $ 33.0
============================================================================================
</Table>

ALLOWANCE FOR LOAN LOSSES

Management's policy is to maintain the allowance for loan losses at a level
sufficient to absorb estimated probable incurred losses in the loan portfolio.
Management performs periodic and systematic detailed reviews of its loan
portfolio to identify trends and to assess the overall collectibility of the
loan portfolio. Accounting standards require that loan losses be recorded when
management determines it is probable that a loss has been incurred and the
amount of the loss can be reasonably estimated. Management believes the
accounting estimate related to the allowance for loan losses is a 'critical
accounting estimate' because: changes in it can materially affect the provision
for loan losses and net income, it requires management to predict borrowers'
likelihood or capacity to repay, and it requires management to distinguish
between losses incurred as of a balance sheet date and losses expected to be
incurred in the future. Accordingly, this is a highly subjective process and
requires significant judgment since it is often difficult to determine when
specific loss events may actually occur. The allowance for loan losses is
increased by the provision for loan losses and recoveries and is decreased by
charged-off loans. This critical accounting estimate applies primarily to the
Retail/Commercial Banking segment. The Executive Committee of FHN's board of
directors approves the level of the allowance for loan losses.

FHN's methodology for estimating the allowance for loan losses is not only
critical to the accounting estimate, but to the credit risk management function
as well. Key components of the estimation process are as follows: (1) commercial
loans determined by management to be individually impaired loans are evaluated
individually and specific reserves are determined based on the difference
between the outstanding loan amount and the estimated net realizable value of
the collateral (if collateral dependent) or the present value of expected future
cash flows; (2) individual commercial loans not considered to be individually
impaired are segmented based on similar credit risk characteristics and
evaluated on a pool basis; (3) retail loans are segmented based on loan types
and credit score bands and loan to value; (4) reserve rates for each portfolio
segment are calculated based on historical charge-offs and are adjusted by
management to reflect current events, trends and conditions (including economic
factors and trends); and (5) management's estimate of probable incurred losses
reflects the reserve rate applied against the balance of loans in each segment
of the loan portfolio.

Principal loan amounts are charged off against the allowance for loan losses in
the period in which the loan or any portion of the loan is deemed to be
uncollectible.

FHN believes that the critical assumptions underlying the accounting estimate
made by management include: (1) the commercial loan portfolio has been properly
risk graded based on information about borrowers in specific industries and
specific issues with respect to single borrowers; (2) borrower specific
information made available to FHN is current and accurate; (3) the loan
portfolio has been segmented properly and individual loans have similar credit
risk characteristics and will behave similarly; (4) known significant loss
events that have occurred were considered by management at the time of assessing
the adequacy of the allowance for loan losses; (5) the economic factors utilized
in the allowance for loan losses estimate are used as a measure of actual
incurred losses; (6) the period of history used for historical loss factors is
indicative of the current environment; and (7) the reserve rates, as well as
other adjustments estimated by management for current events, trends, and

First Horizon National Corporation     45





<Page>


conditions, utilized in the process reflect an estimate of losses that have been
incurred as of the date of the financial statements.

While management uses the best information available to establish the allowance
for loan losses, future adjustments to the allowance for loan losses and
methodology may be necessary if economic or other conditions differ
substantially from the assumptions used in making the estimates or, if required
by regulators, based upon information at the time of their examinations. Such
adjustments to original estimates, as necessary, are made in the period in which
these factors and other relevant considerations indicate that loss levels vary
from previous estimates.

GOODWILL AND ASSESSMENT OF IMPAIRMENT

FHN's policy is to assess goodwill for impairment at the reporting unit level on
an annual basis or between annual assessments if an event occurs or
circumstances change that would more likely than not reduce the fair value of a
reporting unit below its carrying amount. Impairment is the condition that
exists when the carrying amount of goodwill exceeds its implied fair value.
Accounting standards require management to estimate the fair value of each
reporting unit in making the annual assessment of impairment. The valuation as
of October 1, 2004, indicated no goodwill impairment for any of the reporting
units.

Management believes the accounting estimates associated with determining fair
value as part of the goodwill impairment test is a 'critical accounting
estimate' because estimates and assumptions are made about FHN's future
performance and cash flows, as well as other prevailing market factors (interest
rates, economic trends, etc.). FHN's policy allows management to make the
determination of fair value using internal cash flow models or by engaging
independent third parties. If a charge to operations for impairment results,
this amount would be reported separately as a component of noninterest expense.
This critical accounting estimate applies to the Retail/Commercial Banking,
Mortgage Banking and Capital Markets business segments. Reporting units have
been defined as the same level as the operating business segments.

The impairment testing process conducted by FHN begins by assigning net assets
and goodwill to each reporting unit. FHN then completes 'step one' of the
impairment test by comparing the fair value of each reporting unit (as
determined based on the discussion below) with the recorded book value (or
'carrying amount') of its net assets, with goodwill included in the computation
of the carrying amount. If the fair value of a reporting unit exceeds its
carrying amount, goodwill of that reporting unit is not considered impaired, and
'step two' of the impairment test is not necessary. If the carrying amount of a
reporting unit exceeds its fair value, step two of the impairment test is
performed to determine the amount of impairment. Step two of the impairment test
compares the carrying amount of the reporting unit's goodwill to the 'implied
fair value' of that goodwill. The implied fair value of goodwill is computed by
assuming all assets and liabilities of the reporting unit would be adjusted to
the current fair value, with the offset as an adjustment to goodwill. This
adjusted goodwill balance is the implied fair value used in step two. An
impairment charge is recognized for the amount by which the carrying amount of
goodwill exceeds its implied fair value.

As noted above, a key estimate made by management during the assessment of
impairment is the fair value of each reporting unit. As of October 1, 2004, FHN
engaged an independent valuation firm to compute the fair value estimates of
each reporting unit as part of its annual impairment assessment. The independent
valuation utilized three separate valuation methodologies and applied a weighted
average to each methodology in order to determine fair value for each reporting
unit.

In connection with obtaining the independent valuation, management provided
certain data and information that was utilized by the third party in their
determination of fair value. This information included budgeted and forecasted
earnings of FHN at the reporting unit level. Management believes that this
information is a critical assumption underlying the estimate of fair value. The
independent third party made other assumptions critical to the process,
including discount rates, asset and liability growth rates, and other income and
expense estimates, through discussions with management.

                                       46     First Horizon National Corporation





<Page>


While management uses the best information available to estimate future
performance for each reporting unit, future adjustments to management's
projections may be necessary if economic conditions differ substantially from
the assumptions used in making the estimates.

CONTINGENT LIABILITIES

A liability is contingent if the amount is not presently known, but may become
known in the future as a result of the occurrence of some uncertain future
event. FHN estimates its contingent liabilities based on management's estimates
about the probability of outcomes and their ability to estimate the range of
exposure. Accounting standards require that a liability be recorded if
management determines that it is probable that a loss has occurred and the loss
can be reasonably estimated. In addition, it must be probable that the loss will
be confirmed by some future event. As part of the estimation process, management
is required to make assumptions about matters that are by their nature highly
uncertain.

The assessment of contingent liabilities, including legal contingencies and
income tax liabilities, involves the use of critical estimates, assumptions and
judgments. Management's estimates are based on their belief that future events
will validate the current assumptions regarding the ultimate outcome of these
exposures. However, there can be no assurance that future events, such as court
decisions or I.R.S. positions, will not differ from management's assessments.
Whenever practicable, management consults with third party experts (attorneys,
accountants, claims administrators, etc.) to assist with the gathering and
evaluation of information related to contingent liabilities. Based on internally
and/or externally prepared evaluations, management makes a determination whether
the potential exposure requires accrual in the financial statements.
Note 18  -  Restrictions, Contingencies, Commitments and Other Disclosures
provides additional information.

QUARTERLY FINANCIAL INFORMATION

TABLE 25 - SUMMARY OF QUARTERLY FINANCIAL INFORMATION

<Table>
<Caption>
                                                     2004                                    2003
                                     -------------------------------------   -------------------------------------
  (Dollars in millions except        FOURTH     THIRD    SECOND     FIRST    Fourth     Third    Second     First
    per share data)                  QUARTER   QUARTER   QUARTER   QUARTER   Quarter   Quarter   Quarter   Quarter
  ----------------------------------------------------------------------------------------------------------------
  <S>                                <C>       <C>       <C>       <C>       <C>       <C>       <C>       <C>
  SUMMARY INCOME INFORMATION:
  Interest income                    $334.8    $300.2    $277.8    $254.0    $253.3    $277.4    $266.9    $255.8
  Interest expense                    106.4      81.9      64.2      58.0      56.8      63.3      66.0      61.5
  Provision for loan losses            11.7      10.1      12.3      14.2      15.4      16.3      27.5      27.5
  Noninterest income                  313.1     327.6     352.3     370.1     386.5     392.3     446.6     442.2
  Noninterest expense                 382.7     365.6     384.0     372.0     382.0     409.9     448.4     427.4
  Net income                          103.1     113.6     118.4     119.3     117.6     118.3     118.4     119.0
  ----------------------------------------------------------------------------------------------------------------
  EARNINGS PER COMMON SHARE          $  .83    $  .91    $  .95    $  .95    $  .93    $  .93    $  .93    $  .94
  DILUTED EARNINGS PER COMMON SHARE     .81       .89       .92       .92       .90       .91       .90       .91
  ----------------------------------------------------------------------------------------------------------------
  COMMON STOCK INFORMATION:
  Closing price per share:
   High                              $44.23    $45.72    $48.01    $47.91    $46.60    $44.98    $47.98    $39.96
   Low                                41.59     42.82     43.00     42.70     42.37     38.97     39.05     36.14
   Period-end                         43.11     43.36     45.47     47.70     44.10     42.46     43.91     39.71
  Dividends declared per share          .43       .40       .40       .40       .40       .30       .30       .30
  ----------------------------------------------------------------------------------------------------------------
</Table>

First Horizon National Corporation     47





<Page>


ACCOUNTING CHANGES

In October 2003, the FASB approved the AICPA's issuance of SOP 03-3, 'Accounting
for Loans or Certain Debt Securities Acquired in a Transfer', which modifies the
accounting for certain loans that are acquired with evidence of deterioration in
credit quality since origination. SOP 03-3 does not apply to loans recorded at
fair value, to revolving loans, or to mortgage loans classified as held for
sale. SOP 03-3 limits the yield that may be accreted on applicable loans to the
excess of the cash flows expected, at acquisition, to be collected over the
investor's initial investment in the loan. SOP 03-3 also prohibits the 'carrying
over' of valuation allowances on applicable loans. SOP 03-3 is effective for
fiscal years beginning after December 15, 2004. The impact at implementation of
adopting SOP 03-3 is expected to be immaterial to the results of future
operations.

In December 2004, the FASB issued SFAS No. 123 (revised 2004), 'Share-Based
Payment' (SFAS No. 123-R), which requires recognition of expense over the
requisite service period for awards of share-based compensation to employees.
SFAS No. 123-R must be adopted no later than July 1, 2005, with earlier adoption
permitted. As permitted by the original SFAS No. 123, FHN has accounted for its
equity awards under the provisions of APB No. 25. Upon adoption of SFAS
No. 123-R, the grant date fair value of an award will be used to measure the
compensation expense recognized for the award. For unvested awards granted prior
to the adoption of SFAS 123-R, the fair values utilized will equal the values
used in preparation of the disclosures required under the original SFAS 123.
Compensation expense recognized after adoption of SFAS 123-R will incorporate an
estimate of awards expected to ultimately vest, which requires estimation of
forfeitures as well as projections related to the satisfaction of performance
conditions that determine vesting. Upon initial adoption of SFAS 123-R, FHN is
required to reclassify deferred compensation debit balances to capital surplus
and to make a cumulative effect entry for outstanding unvested awards that are
not expected to vest due to anticipated forfeiture. SFAS 123-R permits
restatement of prior period financial statements using the amounts from prior
SFAS 123 disclosures. FHN expects to adopt SFAS No 123-R on July 1, 2005, and
restate prior period financial statements. The adoption of SFAS No. 123-R,
without considering any plan modifications, is estimated to result in a
reduction of net income for the last six months of 2005 between $8 million and
$12 million, which represents $.04 to $.06 per share. For the full year 2005,
including the effect of restating earnings for the first six months upon
adoption, the impact is estimated to result in a reduction of net income between
$16 million and $20 million, which represents $.08 to $.10 per share.

SUBSEQUENT EVENTS

On January 7, 2005, FHN's capital markets division, FTN Financial, completed the
acquisition of the assets and operations of the fixed income business of SLK, a
division of Goldman Sachs & Co. The acquisition is expected to be accretive to
FHN's earnings per share during 2005.

In February 2005, FTBNA entered into a $5.0 billion bank note program. The bank
note program provides FTBNA with a facility under which it may continuously
issue and offer short- and medium-term unsecured notes. An existing bank note
program under which FTBNA had nearly exhausted its ability to issue and sell
longer-term notes has been terminated in connection with the establishment of
the new program. That termination does not affect any previously-issued notes
outstanding. Net proceeds from the notes are expected to be used by FTBNA for
general purposes in the ordinary course of banking business. For additional
information see also Liquidity Risk Management.

                                       48     First Horizon National Corporation





<Page>


GLOSSARY

ALLOWANCE FOR LOAN LOSSES  -  Valuation reserve representing the amount
considered by management to be adequate to cover estimated probable incurred
losses in the loan portfolio.

BASIS POINT  -  The equivalent of one-hundredth of one percent (0.01). One
hundred basis points equals one percent. This unit is generally used to measure
movements in interest yields and rates.

BASIS RISK  -  Refers to changes in the relationship between various interest
rate segments (e.g. the difference between the Prime and the Fed Funds Rates).

BOOK VALUE PER COMMON SHARE  -  A ratio determined by dividing shareholders'
equity at the end of a period by the number of common shares outstanding at the
end of that period.

CHARGE-OFFS  -  The amount charged against the allowance for loan losses to
reduce specific loans to their net realizable value.

CLASSIFIED LOAN  -  A loan that has caused management to have serious doubts
about the borrower's ability to comply with present repayment terms. Included in
this category are grades 8, 9 and 10 performing and nonperforming loans. In
compliance with the standards established by the Office of the Comptroller of
the Currency (OCC) these loans are classified as substandard, doubtful, and loss
depending on the severity of the loan's deterioration.

COMMERCIAL PAPER  -  A short-term unsecured debt obligation of the parent
company with maturities typically of 30 days to 270 days.

COMMERCIAL AND STANDBY LETTERS OF CREDIT  -  Commercial letters of credit are
issued or confirmed by an entity to ensure the payment of its customers'
payables and receivables. Standby letters of credit are issued by an entity to
ensure its customers' performance in dealing with others.

COMMITMENT TO EXTEND CREDIT  -  Agreements to make or acquire a loan or lease as
long as agreed-upon terms (e.g., expiration date, covenants, or notice) are met.
Generally these commitments have fixed expiration dates or other termination
clauses and may require payment of a fee.

CORE DEPOSITS  -  Core deposits consist of all interest-bearing and
noninterest-bearing deposits, except certificates of deposit over $100,000. They
include checking interest deposits, money market deposit accounts, time and
other savings, plus demand deposits.

DERIVATIVE FINANCIAL INSTRUMENT  -  A contract or agreement whose value is
derived from changes in interest rates, foreign exchange rates, prices of
securities or commodities, or financial or commodity indices.

DILUTED EARNINGS PER COMMON SHARE  -  Net income, divided by average shares
outstanding plus the number of shares that would be outstanding if all dilutive
common shares had been issued. Dilutive common shares, for example, would
represent outstanding options where the average stock price exceeds the price at
which the option was granted.

EARNING ASSETS  -  Assets that generate interest or dividend income or
yield-related fee income, such as loans and investment securities.

EARNINGS PER COMMON SHARE  -  Net income, divided by the average number of
common shares outstanding in the period. (See also diluted earnings per share)

FEDERAL FUNDS SOLD/PURCHASED  -  Excess balances of depository institutions
which are loaned to each other, generally on an overnight basis.

First Horizon National Corporation     49





<Page>


FLOW SALES  -  Refers to sales of loans where the servicing right is released at
the time the related loan is sold.

FULLY TAXABLE EQUIVALENT (FTE)  -  Reflects the rate of tax-exempt income
adjusted to a level that would yield the same after-tax income had that income
been subject to taxation.

HEDGE  -  An instrument used to reduce risk by entering into a transaction which
offsets existing or anticipated exposures to changes in interest rates or fair
value of assets or liabilities.

INTEREST FREE SOURCES  -  Noninterest bearing liabilities (such as demand
deposits, other liabilities, and shareholders' equity) net of nonearning assets
(such as cash, fixed assets, and other assets).

INTEREST ONLY STRIP  -  Mortgage security consisting of the interest rate
portion of a stripped mortgage backed security.

INTEREST RATE CAPS AND FLOORS  -  Contracts with notional principal amounts that
require the seller, in exchange for a fee, to make payments to the purchaser if
a specified market interest rate exceeds a fixed upper 'capped' level or falls
below a fixed lower 'floor' level on specified future dates.

INTEREST RATE FORWARD CONTRACTS  -  Contracts representing commitments either to
purchase or sell at a specified future date a specified security or financial
instrument at a specified price, and may be settled in cash or through delivery.
These obligations are generally short-term in nature.

INTEREST RATE OPTION  -  A contract that grants the holder (purchaser), for a
fee, the right to either purchase or sell a financial instrument at a specified
price within a specified period of time or on a specified date from or to the
writer (seller) of the option.

INTEREST RATE SENSITIVITY  -  The relationship of changes in interest income and
interest expense to fluctuations in interest rates over a defined period of
time.

INTEREST RATE SWAP  -  An agreement in which two entities agree to exchange, at
specified intervals, interest payment streams calculated on an agreed upon
notional principal amount with at least one stream based on a floating rate
index.

LEVERAGE RATIO  -  Ratio consisting of Tier 1 capital divided by quarterly
average assets adjusted for certain unrealized gains/(losses) on available for
sale securities, goodwill, certain other intangible assets, the disallowable
portion of mortgage servicing rights and other disallowed assets.

LIQUIDITY  -  The ability of a corporation to generate adequate funds to meet
its cash flow requirements. It is measured by the ability to quickly convert
assets into cash with minimal exposure to interest rate risk, by the size and
stability of the core deposit base, and by additional borrowing capacity within
the money markets.

MARKET CAPITALIZATION  -  Market value of a company computed by multiplying the
number of shares outstanding by the current stock price.

MORTGAGE BACKED SECURITIES  -  Investment securities backed by a pool of
mortgages or trust deeds. Principal and interest payments on the underlying
mortgages are used to pay principal and interest on the securities.

MORTGAGE PIPELINE  -  Interest rate commitments made to customers on mortgage
loans that have not yet been closed and funded.

MORTGAGE WAREHOUSE  -  A mortgage loan that has been closed and funded and is
awaiting sale and delivery into the secondary market.

                                       50     First Horizon National Corporation





<Page>


MORTGAGE SERVICING RIGHTS (MSR)  -  The right to service mortgage loans,
generally owned by someone else, for a fee. Loan servicing includes collecting
payments; remitting funds to investors, insurance companies, and taxing
authorities; collecting delinquent payments; and foreclosing on properties when
necessary.

NET INTEREST INCOME (NII)  -  Interest income less interest expense.

NET INTEREST MARGIN (NIM)  -  Expressed as a percentage, net interest margin is
a measure of the profitability of earning assets. It is computed by dividing
fully taxable equivalent net interest income by average earning assets.

NET INTEREST SPREAD  -  The difference between the average yield earned on
earning assets on a fully taxable equivalent basis and the average rate paid for
interest-bearing liabilities.

NONACCRUAL LOANS  -  Loans on which interest accruals have been discontinued due
to the borrower's financial difficulties. Interest income on these loans is
reported on a cash basis as it is collected after recovery of principal.

NONPERFORMING ASSETS  -  Interest earning assets on which interest income is not
being accrued, restructured loans on which interest rates or terms of repayment
have been materially revised, real estate properties acquired through
foreclosure, and repossessed assets.

NOTIONAL PRINCIPAL AMOUNT  -  An amount on which payments for interest rate
swaps and interest rate options, caps and floors are based. The 'notional
amount' is not paid or received.

PRINCIPAL ONLY STRIP  -  Mortgage security consisting of the principal portion
of a stripped mortgage backed security.

PROVISION FOR LOAN LOSSES  -  The periodic charge to earnings for potential
losses in the loan portfolio.

PURCHASE OBLIGATION  -  An agreement to purchase goods or services that is
enforceable and legally binding and that specifies all significant terms,
including: fixed or minimum quantities to be purchased; fixed, minimum or
variable price provisions; and the approximate timing of the transaction.

PURCHASED FUNDS  -  The combination of certificates of deposit greater than
$100,000, federal funds purchased, securities sold under agreement to
repurchase, bank notes, commercial paper, and other short-term borrowings.

RECOVERIES  -  The amount added to the allowance for loan losses when funds are
received on a loan which was previously charged off.

REPURCHASE AGREEMENT  -  A method of short-term financing where one party agrees
to buy back, at a future date (generally overnight) and an agreed-upon price, a
security it sells to another party.

RESTRUCTURED LOANS  -  Loans where the institution, for economic or legal
reasons related to the debtor's financial difficulties, grants a concession to
the debtor that it would not otherwise consider.

RETURN ON AVERAGE ASSETS (ROA)  -  A measure of profitability that indicates how
effectively an institution utilized its assets. It is calculated by dividing net
income by total average assets.

RETURN ON AVERAGE EQUITY (ROE)  -  A measure of profitability that indicates
what an institution earned on its shareholders' investment. ROE is calculated by
dividing net income by total average shareholders' equity.

RISK-ADJUSTED ASSETS  -  A regulatory risk-based calculation that takes into
account the broad differences in risks among a banking organization's assets and
off-balance sheet instruments.

First Horizon National Corporation     51





<Page>


SECURITIZED ASSETS OR SECURITIZATION  -  The process by which financial assets
are packaged, underwritten and sold as securities.

TIER 1 CAPITAL RATIO  -  Ratio consisting of shareholders' equity adjusted for
certain unrealized gains/(losses) on available for sale securities, reduced by
goodwill, certain other intangible assets, the disallowable portion of mortgage
servicing rights and other disallowed assets divided by risk-adjusted assets.

TOTAL CAPITAL RATIO  -  Ratio consisting of Tier 1 capital plus the allowable
portion of the allowance for loan losses and qualifying subordinated debt
divided by risk-adjusted assets.

TOTAL REVENUE  -  The sum of net interest income and noninterest income.

                                       52     First Horizon National Corporation





<Page>


                       FIRST HORIZON NATIONAL CORPORATION
       REPORT OF MANAGEMENT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management of First Horizon National Corporation is responsible for establishing
and maintaining adequate internal control over financial reporting as defined in
Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. First
Horizon National Corporation's internal control over financial reporting is
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles.

Even effective internal controls, no matter how well designed, have inherent
limitations such as the possibility of human error or of circumvention or
overriding of controls, and consideration of cost in relation to benefit of a
control. Moreover, effectiveness must necessarily be considered according to the
existing state of the art of internal control. Further, because of changes in
conditions, the effectiveness of internal controls may diminish over time.

Management assessed the effectiveness of First Horizon National Corporation's
internal control over financial reporting as of December 31, 2004. In making
this assessment, management used the criteria set forth by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO) in Internal
Control-Integrated Framework.

Based on our assessment and those criteria, management believes that First
Horizon National Corporation maintained effective internal control over
financial reporting as of December 31, 2004.

First Horizon National Corporation's independent auditors have issued an
attestation report on management's assessment of First Horizon National
Corporation's internal control over financial reporting. That report appears on
the following page.

First Horizon National Corporation     53





<Page>


            REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Shareholders
First Horizon National Corporation:

We have audited management's assessment, included in the accompanying
Management's Report on Internal Control Over Financial Reporting, that First
Horizon National Corporation (the Company) maintained effective internal control
over financial reporting as of December 31, 2004, based on criteria established
in Internal Control -- Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO). The Company's
management is responsible for maintaining effective internal control over
financial reporting and for its assessment of the effectiveness of internal
control over financial reporting. Our responsibility is to express an opinion on
management's assessment and an opinion on the effectiveness of the Company's
internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether effective
internal control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of internal control over
financial reporting, evaluating management's assessment, testing and evaluating
the design and operating effectiveness of internal control, and performing such
other procedures as we considered necessary in the circumstances. We believe
that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with accounting principles generally accepted in the United States of America. A
company's internal control over financial reporting includes those policies and
procedures that (1) pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions and dispositions of the
assets of the company; (2) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with
authorizations of management and directors of the company; and (3) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company's assets that could have a
material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting
may not prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.

In our opinion, management's assessment that First Horizon National Corporation
maintained effective internal control over financial reporting as of
December 31, 2004, is fairly stated, in all material respects, based on criteria
established in Internal Control -- Integrated Framework issued by COSO. Also, in
our opinion, First Horizon National Corporation maintained, in all material
respects, effective internal control over financial reporting as of
December 31, 2004, based on criteria established in Internal
Control -- Integrated Framework issued by COSO.

We also have audited, in accordance with the standards of the Public Company
Accounting Oversight Board (United States), the consolidated balance sheets of
First Horizon National Corporation as of December 31, 2004 and 2003, and the
related consolidated statements of income, shareholders' equity and cash flows
for each of the years in the three-year period ended December 31, 2004, and our
report dated March 11, 2005 expressed an unqualified opinion on those
consolidated financial statements.

[Signature of KPMG LLP]
Memphis, Tennessee
March 11, 2005

                                       54     First Horizon National Corporation





<Page>


            REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Shareholders
First Horizon National Corporation:

We have audited the accompanying consolidated statements of condition of First
Horizon National Corporation (the Company) as of December 31, 2004 and 2003, and
the related consolidated statements of income, shareholders' equity and cash
flows for each of the years in the three year period ended December 31, 2004.
These consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of First Horizon
National Corporation as of December 31, 2004 and 2003, and the results of its
operations and its cash flows for each of the years in the three year period
ended December 31, 2004, in conformity with U.S. generally accepted accounting
principles.

We also have audited, in accordance with the standards of the Public Company
Accounting Oversight Board (United States), the effectiveness of First Horizon
National Corporation's internal control over financial reporting as of December
31, 2004, based on criteria established in Internal Control -- Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission (COSO), and our report dated March 11, 2005 expressed an unqualified
opinion on management's assessment of, and the effective operation of, internal
control over financial reporting.

[Signature of KPMG LLP]
Memphis, Tennessee
March 11, 2005

First Horizon National Corporation     55





<Page>


                      CONSOLIDATED STATEMENTS OF CONDITION

<Table>
<Caption>
                                                                       December 31
                                                              -----------------------------
(Dollars in thousands)                                           2004          2003
- -------------------------------------------------------------------------------------------
<S>                                                           <C>           <C>
ASSETS:
Cash and due from banks (Note 18)                             $   638,189   $   773,294
Federal funds sold and securities purchased under agreements
 to resell                                                        682,310       381,500
- -------------------------------------------------------------------------------------------
   Total cash and cash equivalents                              1,320,499     1,154,794
- -------------------------------------------------------------------------------------------
Investment in bank time deposits                                    5,329           498
Trading securities                                                988,015       800,490
Loans held for sale                                             5,167,981     2,977,723
Securities available for sale (Note 3)                          2,680,556     2,469,342
Securities held to maturity (fair value of $457 on
 December 31, 2004, and $1,077 on December 31, 2003)
 (Note 3)                                                             441         1,028
Loans, net of unearned income (Note 4)                         16,427,673    13,990,525
 Less: Allowance for loan losses                                  158,159       160,333
- -------------------------------------------------------------------------------------------
   Total net loans                                             16,269,514    13,830,192
- -------------------------------------------------------------------------------------------
Premises and equipment, net (Note 5)                              379,359       350,202
Real estate acquired by foreclosure                                27,777        24,075
Mortgage servicing rights, net (Note 6)                         1,036,458       795,938
Goodwill (Note 7)                                                 187,200       174,807
Other intangible assets, net (Note 7)                              34,769        38,742
Capital markets receivables and other assets                    1,673,785     1,888,859
- -------------------------------------------------------------------------------------------
TOTAL ASSETS                                                  $29,771,683   $24,506,690
===========================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits:
 Interest-bearing (Note 8)                                    $14,787,645   $11,139,758
 Noninterest-bearing                                            4,994,522     4,731,564
- -------------------------------------------------------------------------------------------
   Total deposits                                              19,782,167    15,871,322
- -------------------------------------------------------------------------------------------
Federal funds purchased and securities sold under agreements
 to repurchase (Note 9)                                         3,247,048     3,079,248
Commercial paper and other short-term borrowings (Note 9)         505,756       227,976
Capital markets payables and other liabilities                  1,578,903     1,710,608
Term borrowings (Note 10)                                       2,616,368     1,726,766
- -------------------------------------------------------------------------------------------
   Total liabilities                                           27,730,242    22,615,920
- -------------------------------------------------------------------------------------------
Preferred stock of subsidiary (Note 12)                               458           452
- -------------------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY:
Preferred stock  -  no par value (5,000,000 shares
 authorized, but unissued)                                              -             -
Common stock  -  $.625 par value (shares
 authorized  -  400,000,000; shares issued  -
 123,531,904 on December 31, 2004 and 124,834,272 on
 December 31, 2003)                                                77,207        78,021
Capital surplus                                                   173,872       145,817
Undivided profits                                               1,795,853     1,662,699
Accumulated other comprehensive (loss)/income, net
 (Note 15)                                                         (9,928)          682
Deferred compensation on restricted stock incentive plans          (8,181)       (9,044)
Deferred compensation obligation                                   12,160        12,143
- -------------------------------------------------------------------------------------------
   Total shareholders' equity                                   2,040,983     1,890,318
- -------------------------------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                    $29,771,683   $24,506,690
===========================================================================================
</Table>

See accompanying notes to consolidated financial statements.

Certain previously reported amounts have been reclassified to agree with
current presentation.

                                       56     First Horizon National Corporation





<Page>


                       CONSOLIDATED STATEMENTS OF INCOME

<Table>
<Caption>
                                                                          Year Ended December 31
                                                              ----------------------------------------------
(Dollars in thousands except per share data)                     2004            2003            2002
- ------------------------------------------------------------------------------------------------------------
<S>                                                           <C>             <C>             <C>
INTEREST INCOME:
Interest and fees on loans                                    $  774,688      $  657,546      $  665,980
Interest on investment securities                                104,144         111,257         143,009
Interest on loans held for sale                                  226,832         229,091         184,038
Interest on trading securities                                    53,398          50,515          43,679
Interest on other earning assets                                   7,740           4,961           5,489
- ------------------------------------------------------------------------------------------------------------
 Total interest income                                         1,166,802       1,053,370       1,042,195
- ------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE:
Interest on deposits:
 Savings                                                             399             832           2,187
 Checking interest and money market                               24,017          22,739          37,055
 Certificates of deposit under $100,000 and other time            60,060          57,139          71,254
 Certificates of deposit $100,000 and more                       108,003          69,336          79,844
Interest on short-term borrowings                                 67,757          62,130          67,657
Interest on term borrowings                                       50,255          35,410          28,584
- ------------------------------------------------------------------------------------------------------------
 Total interest expense                                          310,491         247,586         286,581
- ------------------------------------------------------------------------------------------------------------
NET INTEREST INCOME                                              856,311         805,784         755,614
Provision for loan losses                                         48,348          86,698          92,184
- ------------------------------------------------------------------------------------------------------------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES              807,963         719,086         663,430
- ------------------------------------------------------------------------------------------------------------
NONINTEREST INCOME:
Mortgage banking                                                 444,758         649,496         436,706
Capital markets                                                  376,558         538,919         448,016
Deposit transactions and cash management                         148,514         146,701         143,315
Merchant processing                                               75,086          57,609          48,403
Insurance commissions                                             56,109          57,811          50,446
Trust services and investment management                          47,274          45,873          48,369
Gains on divestitures                                              7,000          22,498           4,550
Equity securities gains/(losses), net                              2,040           8,491          (9,435)
Debt securities gains/(losses), net                               18,708          (6,113)            255
All other income (Note 14)                                       187,139         146,299         141,310
- ------------------------------------------------------------------------------------------------------------
 Total noninterest income                                      1,363,186       1,667,584       1,311,935
- ------------------------------------------------------------------------------------------------------------
ADJUSTED GROSS INCOME AFTER PROVISION FOR LOAN LOSSES          2,171,149       2,386,670       1,975,365
- ------------------------------------------------------------------------------------------------------------
NONINTEREST EXPENSE:
Employee compensation, incentives and benefits                   914,947         995,609         830,672
Occupancy                                                         89,402          83,583          76,669
Equipment rentals, depreciation and maintenance                   72,695          68,973          68,736
Operations services                                               67,523          67,948          60,238
Communications and courier                                        49,590          50,535          45,085
Amortization of intangible assets                                  9,541           7,980           6,200
All other expense (Note 14)                                      300,642         393,044         329,706
- ------------------------------------------------------------------------------------------------------------
 Total noninterest expense                                     1,504,340       1,667,672       1,417,306
- ------------------------------------------------------------------------------------------------------------
INCOME BEFORE INCOME TAXES                                       666,809         718,998         558,059
Provision for income taxes (Note 16)                             212,401         245,689         181,608
- ------------------------------------------------------------------------------------------------------------
NET INCOME                                                    $  454,408      $  473,309      $  376,451
============================================================================================================
EARNINGS PER COMMON SHARE (Note 17)                           $     3.64      $     3.73      $     2.97
- ------------------------------------------------------------------------------------------------------------
DILUTED EARNINGS PER COMMON SHARE (Note 17)                   $     3.54      $     3.62      $     2.89
- ------------------------------------------------------------------------------------------------------------
WEIGHTED AVERAGE COMMON SHARES (Note 17)                      124,730,571     126,765,423     126,714,413
- ------------------------------------------------------------------------------------------------------------
DILUTED WEIGHTED AVERAGE SHARES (Note 17)                     128,436,342     130,876,041     130,221,169
- ------------------------------------------------------------------------------------------------------------
</Table>

Certain previously reported amounts have been reclassified to agree with current
presentation.
See accompanying notes to consolidated financial statements.

First Horizon National Corporation     57





<Page>


                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

<Table>
<Caption>
                                                                                         Accumulated                Deferred
                                                                                            Other       Deferred    Compen-
                               Common                 Common    Capital    Undivided    Comprehensive   Compen-      sation
  (Amounts in thousands)       Shares      Total       Stock    Surplus     Profits     (Loss)/Income    sation    Obligation
  ---------------------------------------------------------------------------------------------------------------------------
  <S>                          <C>       <C>          <C>       <C>        <C>          <C>             <C>        <C>
  Balance, December 31, 2001  125,865    $1,477,762  $78,666    $106,682   $1,263,649     $ 23,278      $(2,126)     $ 7,613
  Net income                        -       376,451        -           -      376,451            -            -            -
  Other comprehensive income:
   Unrealized market
    adjustments on cash flow
    hedges, net of tax              -          (137)       -           -            -         (137)           -            -
   Unrealized market
    adjustments on securities
    available for sale, net
    of tax                          -         4,735        -           -            -        4,735            -            -
   Minimum pension liability,
    net of tax                               (1,389)                                        (1,389)
                               --------------------------------------------------------------------------------------------------
  Comprehensive income              -       379,660        -           -      376,451        3,209            -            -
                               --------------------------------------------------------------------------------------------------
  Cash dividends declared
   ($1.05/share)                    -      (131,982)       -           -     (131,982)           -            -            -
  Common stock issued for
   exercise of stock options    2,613        50,700    1,633      45,955            -            -            -        3,112
  Tax benefit from
   non-qualified stock
   options                          -        11,395        -      11,395            -            -            -            -
  Common stock repurchased     (3,053)     (111,187)  (1,909)    (63,106)     (46,172)           -            -            -
  Amortization on restricted
   stock incentive plans            -         2,499        -           -            -            -        2,499            -
  Other                           175        12,333      110      18,392            -            -       (6,169)           -
  ---------------------------------------------------------------------------------------------------------------------------
  Balance, December 31, 2002  125,600     1,691,180   78,500     119,318    1,461,946       26,487       (5,796)      10,725
  Net income                        -       473,309        -           -      473,309            -            -            -
  Other comprehensive income:
   Unrealized market
    adjustments on cash flow
    hedges, net of tax              -           137        -           -            -          137            -            -
   Unrealized market
    adjustments on securities
    available for sale, net
    of tax                          -       (24,813)       -           -            -      (24,813)           -            -
   Minimum pension liability,
    net of tax                               (1,129)                                        (1,129)
                               --------------------------------------------------------------------------------------------------
  Comprehensive income              -       447,504        -           -      473,309      (25,805)           -            -
                               --------------------------------------------------------------------------------------------------
  Cash dividends declared
   ($1.30/share)                    -      (163,452)       -           -     (163,452)           -            -            -
  Common stock issued for
   exercise of stock options    3,889        77,876    2,431      74,027            -            -            -        1,418
  Tax benefit from
   non-qualified stock
   options                          -        27,842        -      27,842            -            -            -            -
  Common stock repurchased     (4,855)     (209,125)  (3,035)    (96,972)    (109,118)           -            -            -
  Amortization on restricted
   stock incentive plans            -         5,121        -           -            -            -        5,121            -
  Other                           200        13,372      125      21,602           14            -       (8,369)           -
  ---------------------------------------------------------------------------------------------------------------------------
  Balance, December 31, 2003  124,834     1,890,318   78,021     145,817    1,662,699          682       (9,044)      12,143
  Net income                        -       454,408        -           -      454,408            -            -            -
  Other comprehensive income:
   Unrealized market
    adjustments on securities
    available for sale, net
    of tax                          -       (10,291)       -           -            -      (10,291)           -            -
   Minimum pension liability,
    net of tax                                 (319)                                          (319)
                               --------------------------------------------------------------------------------------------------
  Comprehensive income              -       443,798        -           -      454,408      (10,610)           -            -
                               --------------------------------------------------------------------------------------------------
  Cash dividends declared
   ($1.63/share)                    -      (201,316)       -           -     (201,316)           -            -            -
  Common stock issued for
   exercise of stock options    2,809        67,068    1,756      65,295            -            -            -           17
  Tax benefit from
   non-qualified stock
   options                          -        15,502        -      15,502            -            -            -            -
  Common stock repurchased     (4,134)     (184,102)  (2,584)    (61,577)    (119,941)           -            -            -
  Amortization on restricted
   stock incentive plans            -         1,845        -           -            -            -        1,845            -
  Other                            23         7,870       14       8,835            3            -         (982)           -
  ---------------------------------------------------------------------------------------------------------------------------
  BALANCE, DECEMBER 31, 2004  123,532    $2,040,983   $77,207   $173,872   $1,795,853     $ (9,928)     $(8,181)     $12,160
  ===========================================================================================================================
</Table>

 See accompanying notes to consolidated financial statements.

                                       58     First Horizon National Corporation





<Page>


                     CONSOLIDATED STATEMENTS OF CASH FLOWS

<Table>
<Caption>
                                                                                    Year Ended December 31
                                                                        ---------------------------------------------
(Dollars in thousands)                                                      2004           2003           2002
- ---------------------------------------------------------------------------------------------------------------------
<S>        <C>                                                           <C>            <C>            <C>
OPERATING  Net income                                                    $   454,408    $   473,309    $   376,451
ACTIVITIES Adjustments to reconcile net income to net cash
            provided/(used) by operating activities:
             Provision for loan losses                                        48,348         86,698         92,184
             Provision for deferred income tax                                41,472        113,716         42,248
             Depreciation and amortization of premises and equipment          48,731         45,087         41,851
             Amortization and impairment of mortgage servicing rights        191,363        290,597        268,003
             Amortization of intangible assets                                 9,541          7,980          6,200
             Net other amortization and accretion                             74,950         81,567         37,618
             Decrease/(increase) in derivatives, net                         159,123         58,298       (186,734)
             Market value adjustment on foreclosed property                    4,022         11,644         18,811
             Loss on early retirement of debt                                      -          5,766          3,724
             Equity securities (gains)/losses, net                            (2,040)        (8,491)         9,435
             Debt securities (gains)/losses, net                             (18,708)         6,113           (255)
             Net (gains)/losses on disposals of fixed assets                    (589)         1,437            936
             Net (increase)/decrease in:
               Trading securities                                           (187,525)        85,374       (247,818)
               Loans held for sale                                          (566,337)     1,819,842     (1,398,256)
               Capital markets receivables                                   321,123       (327,190)       137,820
               Interest receivable                                           (19,528)        (8,369)         8,535
               Other assets                                                 (724,706)      (450,432)      (264,564)
             Net increase/(decrease) in:
               Capital markets payables                                     (314,578)       282,070         (7,732)
               Interest payable                                               12,504            579         (6,799)
               Other liabilities                                             150,341         28,110        125,565
- ---------------------------------------------------------------------------------------------------------------------
                   Total adjustments                                        (772,493)     2,130,396     (1,319,228)
- ---------------------------------------------------------------------------------------------------------------------
           Net cash (used)/provided by operating activities                 (318,085)     2,603,705       (942,777)
- ---------------------------------------------------------------------------------------------------------------------
INVESTING  Maturities of held to maturity securities                             589        142,723        179,628
ACTIVITIES Available for sale securities:
            Sales                                                          1,298,485        992,017        170,819
            Maturities                                                       415,647      1,546,914      1,247,002
            Purchases                                                     (1,920,053)    (2,745,032)    (1,768,354)
           Premises and equipment:
            Sales                                                              1,048            847          8,032
            Purchases                                                        (78,763)      (149,600)       (56,794)
           Net increase in loans                                          (4,165,896)    (2,808,349)    (1,394,641)
           Net (increase)/decrease in investment in bank time deposits        (4,831)         1,346           (166)
           Proceeds from divestitures, net of cash and cash equivalents            -         21,577        206,664
           Acquisitions, net of cash and cash equivalents acquired                 -         (1,930)       (13,433)
- ---------------------------------------------------------------------------------------------------------------------
           Net cash used by investing activities                          (4,453,774)    (2,999,487)    (1,421,243)
- ---------------------------------------------------------------------------------------------------------------------
FINANCING  Common stock:
ACTIVITIES  Exercise of stock options                                         67,935         77,591         51,015
            Cash dividends paid                                             (198,495)      (150,863)      (125,736)
            Repurchase of shares                                            (184,224)      (209,263)      (111,187)
           Term borrowings:
            Issuance                                                       1,506,605        925,887        481,816
            Payments                                                        (610,585)      (287,207)      (106,569)
           Issuance of preferred stock of subsidiary                               -            260              -
           Net increase/(decrease) in:
            Deposits                                                       3,910,748         45,770      2,271,911
            Short-term borrowings                                            445,580       (180,316)       116,864
- ---------------------------------------------------------------------------------------------------------------------
           Net cash provided by financing activities                       4,937,564        221,859      2,578,114
- ---------------------------------------------------------------------------------------------------------------------
           Net increase/(decrease) in cash and cash equivalents              165,705       (173,923)       214,094
- ---------------------------------------------------------------------------------------------------------------------
           Cash and cash equivalents at beginning of period                1,154,794      1,328,717      1,114,623
- ---------------------------------------------------------------------------------------------------------------------
           Cash and cash equivalents at end of period                    $ 1,320,499    $ 1,154,794    $ 1,328,717
=====================================================================================================================
           Total interest paid                                           $   297,089    $   246,136    $   292,618
- ---------------------------------------------------------------------------------------------------------------------
           Total income taxes paid                                           182,255        159,188        123,071
- ---------------------------------------------------------------------------------------------------------------------
</Table>

See accompanying notes to consolidated financial statements.
Certain previously reported amounts have been reclassified to agree with
current presentation.

First Horizon National Corporation     59






<Page>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF ACCOUNTING. The consolidated financial statements of First Horizon
National Corporation (FHN), including its subsidiaries, are prepared in
conformity with accounting principles generally accepted in the United States of
America and follow general practices within the industries in which it operates.
This preparation requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
These estimates and assumptions are based on information available as of the
date of the financial statements and could differ from actual results.

PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION. The consolidated
financial statements include the accounts of FHN and other entities in which it
has a controlling financial interest. Affiliates that FHN does not have a
controlling financial interest in are accounted for by the equity method. All
significant intercompany transactions and balances have been eliminated. For
purposes of comparability, certain prior period amounts have been reclassified
to conform to current year presentation. None of these reclassifications had any
effect on net income or earnings per share for any of the periods presented.

Business combinations accounted for as purchases are included in the financial
statements from the respective dates of acquisition.

REVENUE RECOGNITION. FHN derives a significant portion of its revenues from fee
based services. Noninterest income from transaction based fees is generally
recognized when the transactions are completed. Noninterest income from service
based fees is generally recognized over the period in which FHN provides the
service.

DEPOSIT TRANSACTIONS AND CASH MANAGEMENT. Deposit transactions include services
related to retail deposit products (such as service charges on checking
accounts), cash management products and services such as electronic transaction
processing (automated clearing house and Electronic Data Interchange), account
reconciliation services, cash vault services, lockbox processing, and
information reporting to large corporate clients.

MERCHANT PROCESSING. Merchant processing involves converting transactions from
plastic media such as debit cards, credit cards, purchase cards, and private
label credit cards into cash for merchants that sell goods and services to
consumers and businesses.

INSURANCE COMMISSIONS. Insurance commissions are derived from the sale of
insurance products and annuities, including acting as an independent agent to
provide commercial and personal property and casualty, life, long-term care, and
disability insurance.

TRUST SERVICES AND INVESTMENT MANAGEMENT. Trust services and investment
management fees include investment management, personal trust, employee
benefits, and custodial trust services.

STATEMENTS OF CASH FLOWS. For purposes of these statements, cash and due from
banks, federal funds sold, and securities purchased under agreements to resell
are considered cash and cash equivalents. Federal funds are usually sold for
one-day periods, and securities purchased under agreements to resell are
short-term, highly liquid investments.

TRADING SECURITIES. Securities purchased in connection with underwriting or
dealer activities are carried at market value. Gains and losses, both realized
and unrealized, on these securities are reflected in noninterest income as
capital markets income. In addition, retained interests, in the form of
interest-only and principal-only strips, from mortgage banking securitizations
are recognized at fair value with gains and losses both realized and unrealized,
recognized in mortgage banking income.

                                       60     First Horizon National Corporation





<Page>



NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

INVESTMENT SECURITIES. Securities that FHN has the ability and positive intent
to hold to maturity are classified as securities held to maturity and are
carried at amortized cost. The amortized cost of all securities is adjusted for
amortization of premium and accretion of discount to maturity, or earlier call
date if appropriate, using the level yield method. Such amortization and
accretion is included in interest income from securities. Realized gains and
losses and declines in value judged to be other than temporary are determined by
the specific identification method and reported in noninterest income.

Securities that may be sold prior to maturity and equity securities are
classified as securities available for sale and are carried at fair value. The
unrealized gains and losses on securities available for sale are excluded from
earnings and are reported, net of tax, as a component of other comprehensive
income within shareholders' equity. Venture capital investments for which there
are not active market quotes are initially valued at cost. Subsequently, these
investments are adjusted to reflect changes in valuation as a result of initial
public offerings or other-than-temporary declines in value.

SECURITIES PURCHASED UNDER RESALE AGREEMENTS AND SECURITIES SOLD UNDER
REPURCHASE AGREEMENTS. Capital Markets (see Note 22 - Business Segment
Information) enters into short-term purchases of securities under agreements to
resell which are accounted for as collateralized financings except where FHN
does not have an agreement to sell the same or substantially the same securities
before maturity at a fixed or determinable price. Securities delivered under
these transactions are delivered to either the dealer custody account at the
Federal Reserve Bank or to the applicable counterparty. Collateral is valued
daily and FHN may require counterparties to deposit additional collateral or
return collateral pledged when appropriate.

Securities sold under agreements to repurchase (securities sold) are offered to
cash management customers as an automated, collateralized investment account.
Securities sold are also used by Retail/Commercial Banking (see Note 22 -
Business Segment Information) to obtain favorable borrowing rates on its
purchased funds.

LOANS HELD FOR SALE AND SECURITIZATION AND RESIDUAL INTERESTS. Loans held for
sale are recorded at the lower of aggregate cost or market value. The carrying
value of loans held for sale is net of deferred origination fees and costs. Net
origination fees and costs are deferred on loans held for sale and included in
the basis of the loans in calculating gains and losses upon sale. Also included
in the lower of cost or market analysis are the estimated costs and market
values of first-lien mortgage loan commitments. The prospective adoption of
Staff Accounting Bulletin (SAB) No. 105 (see Accounting Changes section)
resulted in lower market values attributed to mortgage loan commitments in 2004
compared to 2003. Gains and losses realized from the sale of these assets,
whether sold directly or through securitization, and adjustments to market value
are included in noninterest income. Some of these loans are sold with provisions
of recourse.

FHN's mortgage lenders originate first-lien mortgage loans primarily for the
purpose of selling them in the secondary market. As of December 31, 2004 and
2003, respectively, the outstanding principal amount of these single-family
residential loans that were sold on a recourse basis was $150.8 million and
$199.3 million. In the event of borrower nonperformance, FHN would assume losses
to the extent they exceed the value of the collateral and private mortgage
insurance, Federal Housing Administration (FHA) insurance or Veterans
Administration (VA) guarantees. In addition, FHN originates, sells and services
loans guaranteed by the VA. In the event of foreclosure, FHN, as a servicer of
VA loans, has credit risk to the extent that the outstanding loan balance
exceeds the VA guarantee and the value of the underlying real estate. As of
December 31, 2004 and 2003, the outstanding principal balance of VA loans
serviced was $3.4 billion and $3.7 billion, respectively. These loans are
reviewed on a regular basis, and a reserve has been established to cover
estimated probable incurred losses.

First Horizon Home Loan Corporation (First Horizon Home Loans), an indirect
wholly-owned subsidiary of FHN, has also completed proprietary securitizations
of loans from the warehouse through its subsidiary, First Horizon Asset
Securities, Inc. The resulting securities are sold as senior and

First Horizon National Corporation     61





<Page>



NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

subordinated bonds. Mortgage servicing rights (MSR) and in certain cases
residual interests or other financal assets have been retained. The retained
interests are initially valued by allocating the total cost basis of the
securitized assets between the assets sold and the retained interests based on
their relative fair values at the time of securitization. The retained
interests, other than MSR, are carried at fair value as a component of trading
securities on the Consolidated Statements of Condition, with realized and
unrealized gains and losses included in current earnings as a component of
noninterest income on the Consolidated Statements of Income.

Retained interests in a securitization may include certificated residual
interests, or financial assets including excess interest (structured as
interest-only strips), interest-only strips, principal-only strips, or
subordinated bonds. Residual interests are financial assets which represent
rights to receive earnings to the extent of excess income generated by the
underlying loans. Excess interest is a financial asset that represents rights to
receive cash flows from serviced assets that exceed contractually specified
servicing fees. Principal-only strips are financial assets which represent
principal cash flow tranches retained as a result of FHN's securitization
transactions. Interest-only strips are financial assets which represent interest
cash flow tranches retained as a result of FHN's securitization transactions.
Subordinated bonds are bonds with junior priority. All retained interests are
recognized on the balance sheet in trading securities at fair value. The fair
values of the certificated residual interests, the excess interest, and the
interest-only strips are determined using market prices from closely comparable
assets such as MSR that are tested against prices determined using a valuation
model that calculates the present value of estimated future cash flows. To
determine the fair value of the principal-only strips, FHN uses the market
prices from comparable assets such as publicly traded FNMA trust principal-only
strips that are adjusted to reflect the relative risk difference between readily
marketable securities and privately issued securities. The fair value of
subordinated bonds is determined using a spread to an interpolated Treasury rate
which is supplied by broker dealers. The fair value of these retained interests
typically changes based on changes in the discount rate and differences between
modeled prepayment speeds and credit losses and actual experience.

FHN periodically securitizes and sells home equity lines of credit (HELOC) for
funding and other strategic reasons. HELOC held for sale are recorded at the
lower of aggregate cost or market value. The carrying value of HELOC held for
sale is net of deferred origination fees and costs, which are included in the
basis of the loans in calculating gains and losses upon sale. Gains and losses
realized from the sale of these assets and adjustments to market value are
included in noninterest income.

In certain cases when First Horizon Equity Lending securitizes and sells HELOC
in the secondary market, it retains an interest in the loans sold primarily
through a residual-interest certificate. The retained interests are initially
valued by allocating the cost basis of the securitized assets between the assets
sold and the retained interests based on their relative fair values at the time
of securitization. Residual-interest certificates are financial assets, which
represent rights to receive earnings to the extent of excess income generated by
the underlying HELOC collateral of certain mortgage-backed securities, which is
not needed to meet contractual obligations of senior security holders.

The fair value of a residual-interest certificate typically changes based on
changes in the discount rate and differences between modeled prepayment speeds
and credit losses and actual experience. Additionally, similar to MSR and
interest-only certificates, the market for residual-interest certificates is
limited, and the precise terms of transactions involving residual-interest
certificates are not typically readily available. Accordingly, First Horizon
Equity Lending relies primarily on a discounted cash flow model to estimate the
fair value of its residual-interest certificates.

Estimating the cash flow components and the resultant fair value of the
residual-interest certificates requires First Horizon Equity Lending to make
certain critical assumptions based upon current market and loan production data.
The primary critical assumptions used by First Horizon Equity Lending to
estimate the fair value of residual-interest securities include prepayment
speeds, credit losses and discount rates, as discussed above. First Horizon
Equity Lending's residual-interest certificates are included as a component of
trading securities on the Consolidated Statements of Condition, with

                                       62     First Horizon National Corporation





<Page>



NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

realized and unrealized gains and losses included in current earnings as a
component of net interest income on the Consolidated Statements of Income.

MSR are initially valued by allocating the total cost between the loan and the
servicing right based on their relative fair values. Since sales of MSR tend to
occur in private transactions and the precise terms and conditions of the sales
are typically not readily available, there is a limited market to refer to in
determining the fair value of MSR. As such, like other participants in the
mortgage banking business, First Horizon Home Loans relies primarily on a
discounted cash flow model to estimate the fair value of its MSR. This model
calculates estimated fair value of the MSR using numerous tranches of MSR, which
share similar key characteristics such as interest rates, type of product (fixed
vs. variable), age (new, seasoned, moderate), agency type and other factors.
First Horizon Home Loans uses assumptions in the model that it believes are
comparable to those used by brokers and other service providers on a quarterly
basis. First Horizon Home Loans also compares its estimates of fair value and
assumptions to recent market activity and against its own experience.

For purposes of impairment evaluation and measurement, the MSR are stratified
based on the predominant risk characteristics of the underlying loans. These
strata currently include adjustable and fixed rate loans. The MSR are amortized
over the period of and in proportion to the estimated net servicing revenues. A
quarterly value impairment analysis is performed using a discounted cash flow
methodology that is disaggregated by predominant risk characteristics.
Impairment, if any, is recognized through a valuation allowance for individual
strata. However, if the impairment is determined to be other than temporary, a
direct write-off of the asset is made.

LOANS. Loans are stated at principal amounts outstanding, net of unearned
income. Interest on loans is recognized on an accrual basis at the applicable
interest rate on the principal amount outstanding. Loan origination fees and
direct costs as well as premiums and discounts are amortized as level yield
adjustments over the respective loan terms. Unamortized net fees or costs are
recognized upon early repayment of the loans. Loan commitment fees are generally
deferred and amortized on a straight-line basis over the commitment period.
Impaired loans are generally carried on a nonaccrual status. Loans are
ordinarily placed on nonaccrual status when, in management's opinion, the
collection of principal or interest is unlikely, the loan has been classified as
'doubtful', or when the collection of principal or interest is 90 days or more
past due.

Accrued but uncollected interest is reversed and charged against interest income
when the loan is placed on nonaccrual status. On retail loans, accrued but
uncollected interest is reversed when the loan is fully or partially charged
off. Management may elect to continue the accrual of interest when the estimated
net realizable value of collateral is sufficient to recover the principal
balance and accrued interest. Interest payments received on nonaccrual and
impaired loans are normally applied to principal. Once all principal has been
received, additional interest payments are recognized on a cash basis as
interest income.

ALLOWANCE FOR LOAN LOSSES. The allowance for loan losses is maintained at a
level that management determines is adequate to absorb estimated probable
incurred losses in the loan portfolio. Management's evaluation process to
determine the adequacy of the allowance utilizes an analytical model based on
historical loss experience, adjusted for current events, trends and economic
conditions. The actual amounts realized could differ in the near term from the
amounts assumed in arriving at the allowance for loan losses reported in the
financial statements.

All losses of principal are charged to the allowance for loan losses in the
period in which the loan is deemed to be uncollectible. Additions are made to
the allowance through periodic provisions charged to current operations and
recovery of principal on loans previously charged off.

PREMISES AND EQUIPMENT. Premises and equipment are carried at cost less
accumulated depreciation and amortization and include additions that materially
extend the useful lives of existing premises and

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equipment. All other maintenance and repair expenditures are expensed as
incurred. Gains and losses on dispositions are reflected in noninterest income
and expense.

Depreciation and amortization are computed on the straight-line method over the
estimated useful lives of the assets and are recorded as noninterest expense.
Leasehold improvements are amortized over the lesser of the lease periods or the
estimated useful lives using the straight-line method. Useful lives utilized in
determining depreciation for furniture, fixtures and equipment and buildings are
three to fifteen and seven to forty-five years, respectively.

REAL ESTATE ACQUIRED BY FORECLOSURE. Real estate acquired by foreclosure
consists of properties that have been acquired in satisfaction of debt. These
properties are carried at the lower of the outstanding loan amount or the
estimated fair market value minus the estimated cost to sell the real estate.
Losses arising at foreclosure are charged to the allowance for loan losses.
Required developmental costs associated with foreclosed property under
construction are capitalized and included in determining the estimated net
realizable value of the property, which is reviewed periodically, and any
write-downs are charged against current earnings. During the normal course of
business, FHN may purchase real estate at foreclosure sale. Losses arising from
the purchase of real estate at foreclosure sale are charged to the foreclosure
reserve.

INTANGIBLE ASSETS. Intangible assets consist of 'Other intangible assets' and
'Goodwill.' The 'Other intangible assets' represents identified intangible
assets, including customer lists, covenants not to compete and premium on
purchased deposits, which are amortized over their estimated useful lives,
except for those assets related to deposit bases that are primarily amortized
over 10 years. Management evaluates whether events or circumstances have
occurred that indicate the remaining useful life or carrying value of amortizing
intangibles should be revised. 'Goodwill' represents the excess of cost over net
assets of acquired subsidiaries less identifiable intangible assets. On an
annual basis, FHN tests goodwill for impairment. For the three year period ended
December 31, 2004, no impairment of 'Other intangible assets' or 'Goodwill' was
recognized.

DERIVATIVE FINANCIAL INSTRUMENTS. FHN utilizes, through its mortgage banking,
capital markets and risk management operations, various derivative financial
instruments, which include interest rate forward contracts, interest rate floors
and caps, options and interest rate swap agreements, as part of its risk
management strategy and as a means to meet customers' needs. These instruments
are subject to credit and market risks. Controls and monitoring procedures for
these instruments have been established and are routinely reevaluated. The
Asset/Liability Committee (ALCO) monitors the usage and effectiveness of these
derivative financial instruments. ALCO, in conjunction with credit officers,
also periodically reviews counterparty creditworthiness.

Credit risk represents the maximum potential loss due to possible
non-performance by obligors and counterparties under the terms of contracts. FHN
manages credit risk by entering into financial instrument transactions through
national exchanges, primary dealers or approved counterparties, and using mutual
margining agreements whenever possible to limit potential exposure. With
exchange-traded contracts, the credit risk is limited to the clearinghouse used.
For non-exchange traded instruments, credit risk may occur when there is a gain
in the fair value of the financial instrument and the counterparty fails to
perform according to the terms of the contract and/or when the collateral proves
to be of insufficient value.

Market risk represents the potential loss due to the decrease in the value of a
financial instrument caused primarily by changes in interest rates, mortgage
loan prepayment speeds or the prices of debt instruments.

Interest rate forward contracts are over-the-counter contracts where two parties
agree to purchase and sell a specific quantity of a financial instrument at a
specified price, with delivery or settlement at a specified date. Futures
contracts are exchange-traded contracts where two parties agree to purchase and
sell a specific quantity of a financial instrument at a specific price, with
delivery or

                                       64     First Horizon National Corporation





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NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

settlement at a specified date. Interest rate option contracts give the
purchaser the right, but not the obligation, to buy or sell a specified quantity
of a financial instrument, at a specified price, during a specified period of
time. Caps and floors are options that are linked to a notional principal amount
and an underlying indexed interest rate. Interest rate swaps involve the
exchange of interest payments at specified intervals between two parties without
the exchange of any underlying principal. Notional amounts are used in such
contracts to calculate interest payments and do not represent credit exposure.
Exposure to interest rate contracts will increase or decrease as interest rates
fluctuate.

Derivative instruments are recorded on the Consolidated Statements of Condition
as either an asset or liability measured at its fair value. Fair value is
defined as the amount FHN would receive or pay in the market to replace the
derivatives as of the valuation date. Fair value is determined using available
market information and appropriate valuation methodologies. Changes in the
instrument's fair value are recognized currently in earnings or other
comprehensive income. If certain criteria are met, changes in the fair value of
the asset or liability being hedged are also recognized currently in earnings.

Mortgage Banking

Mortgage banking interest rate lock commitments, which have been determined to
be derivative instruments, are recorded at fair value with changes in fair value
recorded currently in earnings and are not a hedgable asset under SFAS No. 133.
See Accounting Changes section for impact of SAB No. 105 on the valuation of
interest rate lock commitments. First Horizon Home Loans enters into forward
sales commitments as fair value hedges to protect the value of mortgage
banking's short-term commitments to fund mortgage loan applications in process
(the pipeline) and first-lien mortgage loans held for sale (the warehouse) from
changes in fair value due to fluctuations in interest rates. First Horizon Home
Loans also enters into futures contracts as fair value hedges to hedge against
interest rate risk associated with adjustable rate mortgages in the pipeline and
warehouse. These forward and futures contracts are derivatives that are recorded
at fair value. Forward and futures contracts used by mortgage banking operations
to hedge against interest rate risk in the warehouse are reviewed periodically
for correlation with expected changes in value. For 2004, 2003, and 2002, gains
of $.8 million, gains of $1.2 million, and losses of $9.8 million, respectively,
that represent the amount of hedge ineffectiveness for these fair value hedges
were recognized in mortgage banking noninterest income.

First Horizon Home Loans also enters into interest rate contracts (including
swaps, swaptions, and mortgage forward sales) to hedge against the effects of
changes in fair value of its MSR due solely to changes in the benchmark rate
(10-year LIBOR). For purposes of measuring effectiveness of the hedge,
volatility and time decay are excluded from the effectiveness measurement of
option-based derivatives. Interest rate derivative contracts used to hedge
against interest rate risk in the servicing portfolio are designated to specific
risk tranches of servicing. First Horizon Home Loans enters into hedges of the
MSR to minimize the effects of loss in value of MSR associated with increased
prepayment activity that generally results from declining interest rates. In a
rising interest rate environment, the value of the MSR generally will increase
while the value of the hedge instruments will decline. Hedges are reset at least
monthly and more frequently, as needed, to respond to changes in interest rates
or hedge composition. For purposes of measuring hedge effectiveness, increases
in values of hedge instruments exceeded the change in value of hedged MSR by
$81.3 million, $131.7 million and $122.0 million in 2004, 2003 and 2002,
respectively. This amount, after reductions of $33.4 million, $16.5 million and
$21.2 million in 2004, 2003 and 2002, respectively, representing the component
of the derivative instruments' losses excluded from the assessment of hedge
effectiveness, was recognized in mortgage banking noninterest income. First
Horizon Home Loans utilizes financial instruments that change in value inversely
to the movement of interest rates to protect the value of its interest-only
securities. Interest-only securities do not qualify for hedge accounting and,
therefore, gains and losses are recognized currently in earnings.

First Horizon National Corporation     65





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Capital Markets

Capital markets buys and sells treasuries, agencies, mortgage securities,
municipal bonds and other securities for resale to customers. When these
securities settle on a delayed basis, they are considered forward contracts.
Capital markets also enters into interest rate contracts, including options,
caps, swaps, futures and floors for its customers. These transactions are
measured at fair value, with changes in fair value recognized currently in
capital markets noninterest income. Related assets are recorded on the balance
sheet as capital markets securities inventory or receivables and any liabilities
are recognized as capital markets payables. Credit risk related to these
transactions is controlled through credit approvals, risk control limits and
ongoing monitoring procedures through ALCO.

Interest Rate Risk Management

FHN's ALCO focuses on managing market risk by controlling and limiting earnings
volatility attributable to changes in interest rates. Interest rate risk exists
to the extent that interest-earning assets and liabilities have different
maturity or repricing characteristics. FHN uses derivatives, including swaps,
caps, options, and collars, that are designed to moderate the impact on earnings
as interest rates change. FHN's interest rate risk management policy is to use
derivatives not to speculate but to hedge interest rate risk or market value of
assets or liabilities.

Interest rate risk management uses interest rate swaps to hedge the interest
rate risk of certain liabilities that qualify as fair value and cash flow
hedges. Interest paid or received for swaps is recognized as an adjustment of
the interest expense of the liabilities whose risk is being managed. For 2004
and 2003, there was no hedge ineffectiveness for qualifying fair value or cash
flow hedges. Interest rate swaps and caps not designated as hedging instruments
are also used to moderate the impact on earnings as interest rates change. Any
contracts that fail to qualify for hedge accounting are measured at fair value
with any gains or losses included in current earnings in noninterest income. For
derivatives designated as cash flow hedges, the effective portion of the gain or
loss on derivatives is reported as a component of accumulated other
comprehensive income.

Cash flows from derivative contracts are reported as operating activities on the
Consolidated Statements of Cash Flows.

ADVERTISING AND PUBLIC RELATIONS. Advertising and public relations costs are
generally expensed as incurred.

INCOME TAXES. FHN accounts for income taxes using the liability method pursuant
to SFAS No. 109, 'Accounting for Income Taxes.' Under this method, FHN's
deferred tax assets and liabilities are determined by applying the applicable
federal and state income tax rates to its cumulative temporary differences.
These temporary differences represent differences between financial statement
carrying amounts and the corresponding tax bases of certain assets and
liabilities. Deferred taxes are provided as a result of such temporary
differences.

FHN and its eligible subsidiaries are included in a consolidated federal income
tax return. FHN files separate returns for subsidiaries that are not eligible to
be included in a consolidated federal income tax return. Based on the laws of
the applicable state where it conducts business operations, FHN either files
consolidated, combined or separate returns.

FHN's federal and state income tax returns are subject to examination by
governmental authorities. Various examinations are currently in progress. FHN
believes that the resolution of both the examinations in progress and the
examination of years not currently in progress will not have a significant
impact on FHN's consolidated financial position or results of operations.

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EARNINGS PER SHARE. Earnings per share is computed by dividing net income by the
weighted average number of common shares outstanding for each period. Diluted
earnings per share is computed by dividing net income by the weighted average
number of common shares outstanding adjusted to include the number of additional
common shares that would have been outstanding if the dilutive potential common
shares resulting from options granted under FHN's stock option plans and
deferred compensation arrangements had been issued. FHN utilizes the treasury
stock method in this calculation.

STOCK OPTIONS. FHN accounts for its employee stock-based compensation plans
under the intrinsic value based method in accordance with Accounting Principles
Board Opinion No. 25, 'Accounting for Stock Issued to Employees.' Had
compensation cost for these plans been determined consistent with SFAS No. 123,
FHN's net income and earnings per share would have been reduced to the following
pro forma amounts:

<Table>
<Caption>
                                                                       December 31
                                                              -------------------------------
(Dollars in thousands except per share data)                    2004       2003       2002
- ---------------------------------------------------------------------------------------------
<S>                                                           <C>        <C>        <C>
Net income, as reported                                       $454,408   $473,309   $376,451
Add: Stock-based employee compensation expense included in
 reported net income, net of related tax effects                 3,414      6,402      7,548
Less: Total stock-based employee compensation expense
 determined under the fair value method for all awards, net
 of related tax effects                                         12,114     27,139     22,087
- ---------------------------------------------------------------------------------------------
Pro forma net income                                          $445,708   $452,572   $361,912
=============================================================================================
Earnings per share, as reported                               $   3.64   $   3.73   $   2.97
Pro forma earnings per share                                      3.57       3.57       2.86
Diluted earnings per share, as reported                           3.54       3.62       2.89
Pro forma diluted earnings per share                              3.47       3.46       2.78
- ---------------------------------------------------------------------------------------------
</Table>

ACCOUNTING CHANGES. On July 1, 2004, FHN adopted FASB Staff Position (FSP) FAS
106-2, 'Accounting and Disclosure Requirements Related to the Medicare
Prescription Drug, Improvement and Modernization Act of 2003'. FSP FAS 106-2
requires a plan sponsor to determine if benefits offered through a
postretirement health care plan are actuarially equivalent to Medicare Part D.
If benefits are determined to be actuarially equivalent, the resulting effect on
the plan's obligations should be reflected as an actuarial gain in determining
the plan's accumulated postretirement benefit obligation. The impact of adopting
FSP FAS 106-2 was immaterial to FHN.

In April 2004, FHN adopted SAB No. 105 'Application of Accounting Principles to
Loan Commitments'. SAB No. 105 prohibits the inclusion of estimated servicing
cash flows and internally-developed intangible assets within the valuation of
interest rate lock commitments under SFAS No. 133, 'Accounting for Derivative
Instruments and Hedging Activities.' SAB No. 105 also requires disclosure of a
registrant's methods of accounting for interest rate lock commitments recognized
under SFAS No. 133 and associated hedging strategies, if applicable. SAB No. 105
was effective for disclosures and interest rate lock commitments initiated after
March 31, 2004. The adoption of SAB No. 105 resulted in an accounting change in
second quarter 2004 and lowered pre-tax earnings by $8.4 million. Since prior
periods are not restated, this accounting change results in a varying impact on
comparability with prior periods. However, the ongoing economic value of FHN's
business is not affected.

On March 31, 2004, FHN adopted FASB Interpretation No. 46 (FIN 46-R),
'Consolidation of Variable Interest Entities (revised December 2003)'. FIN 46-R
clarifies certain aspects of FIN 46 and provides certain entities with
exemptions from the requirements of FIN 46. Additionally, FIN 46-R incorporates
the guidance found in eight final FSPs that had been issued prior to its
release. FIN 46-R requires the consolidation by a business enterprise of
variable interest entities (VIE) in which it is the primary beneficiary. FIN
46-R also required the adoption of FIN 46, as of December 31, 2003, for all
entities

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previously considered as special purpose entities and for all VIE created after
January 31, 2003. Upon adoption of FIN 46-R, FHN reassessed certain of its
nonconsolidated interests as VIE but did not meet the criteria of primary
beneficiary and, therefore, did not consolidate any of its VIE, including First
Tennessee Capital I (Capital I) and First Tennessee Capital II (Capital II) (See
Note 11 - Guaranteed Preferred Beneficial Interests in First Horizon's Junior
Subordinated Debentures).

On December 31, 2003, FHN adopted FIN 46, 'Consolidation of Variable Interest
Entities'. Upon adoption of this standard, FHN deconsolidated its subsidiary,
First Tennessee Capital I (Capital I), which had issued $100.0 million of
capital securities that are fully and unconditionally guaranteed by FHN. As a
result of this deconsolidation the capital securities are not included on FHN's
Statement of Condition. However, $103.0 million of junior subordinated
debentures issued by FHN to Capital I are included in term borrowings. FHN
identified certain of its nonconsolidated interests as VIE but did not meet the
criteria of primary beneficiary and, therefore, did not consolidate any of its
VIE. See Note 25 - Variable Interest Entities for additional information.

On December 31, 2003, FHN adopted SFAS No. 132 (revised 2003), 'Employers'
Disclosures about Pensions and Other Postretirement Benefits'. This standard
does not change the measurement or recognition of those plans required by SFAS
No. 87 and SFAS No. 106.

Additionally, the disclosure requirements of the original SFAS No. 132 have been
retained. SFAS No. 132 (revised 2003) requires additional disclosure about the
assets, obiligations, cash flows, and net periodic benefit cost of defined
benefit pension plans and other defined benefit postretirement plans. The
adoption of SFAS 132 (revised 2003) did not have an impact on the results of
operations.

On December 31, 2003, FHN adopted certain disclosure requirements of Emerging
Issues Task Force (EITF) Issue No. 03-1, 'The Meaning of Other-Than-Temporary
Impairment and Its Application to Certain Investments'. These disclosures
concerned unrealized losses related to investments in debt and marketable equity
securities that are accounted for under SFAS No. 115. Disclosures include the
length of time investments have been in a loss position and discussion
pertaining to the nature of the impairment. In September 2004, the FASB approved
issuance of Staff Position (FSP) EITF 03-1-1, 'Effective Date of Paragraphs 10
through 20 of EITF Issue No. 03-1, The Meaning of Other-Than-Temporary
Impairment and Its Application to Certain Investments' (EITF 03-1). FSP EITF
03-1-1 delays the effective date of paragraphs 10 through 20 of EITF 03-1 as
they relate to recognition of other-than-temporary impairment for cost method
and marketable investments. This deferral will extend until the FASB provides
clarification of the guidance presented in paragraphs 10 through 20. Effective
July 1, 2004, FHN adopted all remaining provisions of EITF Issue 03-1, including
measurement guidance for evaluating whether impairment has occurred for
marketable securities and cost method investments. Effective December 31, 2004,
cost method investments are subject to similar disclosures as those made for
marketable securities in 2003. The effect of implementing the final provisions
of paragraphs 10 through 20 cannot currently be estimated due to the pending
implementation issues. The adoption of all other provisions of EITF Issue No.
03-1 did not have an impact on the results of operations.

On July 1, 2003, FHN adopted SFAS No. 150, 'Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity', and classified
its mandatorily redeemable preferred stock of subsidiary ($45.1 million on
July 1, 2003) as term borrowings. Historically, the related distribution on
these instruments ($4.6 million annually) were classified as noninterest expense
on the Consolidated Statements of Income, but as of July 1, 2003, are classified
as interest expense on a prospective basis. As required by SFAS No. 150, prior
periods were not restated.

On July 1, 2003, FHN adopted SFAS No. 149, 'Amendment of Statement 133 on
Derivative Instruments', which amends and clarifies financial accounting and
reporting for derivative instruments, including certain derivative instruments
embedded in other contracts and for hedging activities under SFAS No. 133. The
impact of adopting this standard was immaterial to FHN.

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NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

On January 1, 2003, FHN adopted SFAS No. 146, 'Accounting for Costs Associated
with Exit or Disposal Activities'. This statement requires that a liability for
the cost associated with an exit or disposal activity be recognized and measured
initially at fair value in the period in which the liability is incurred. Prior
to the effective date of this statement, costs associated with an exit or
disposal plan were recognized at the date of commitment, as required under EITF
Issue 94-3. This statement does not apply to costs associated with an exit
activity that involves an entity newly acquired in a business combination or
with a disposal activity covered by SFAS No. 144. The impact of adopting this
statement was immaterial to FHN.

On January 1, 2003, FHN adopted the final provisions of Interpretation No. 45,
'Guarantor's Accounting and Disclosure Requirements for Guarantees, Including
Indirect Guarantees of Indebtedness of Others'. This interpretation elaborates
on the disclosures to be made by a guarantor in interim and annual financial
statements about obligations assumed under certain guarantees it has issued. It
also clarifies that a guarantor is required to recognize, at the inception of a
guarantee, a liability for the fair value of the obligation undertaken in
issuing the guarantee. This interpretation does not prescribe a specific
approach for subsequently measuring the guarantor's liability over the term of
the related guarantee. This interpretation also incorporates, without change,
the guidance in FASB Interpretation No. 34, 'Disclosure of Indirect Guarantees
of Indebtedness of Others', which is superseded. The impact of adopting this
statement was immaterial to FHN.

In December 2002, FHN adopted SFAS No. 148, 'Accounting for Stock-Based
Compensation - Transition and Disclosure'. This statement amends SFAS No. 123,
'Accounting for Stock-Based Compensation', to provide alternative methods for
voluntary change to the fair value based method of accounting for stock-based
employee compensation. In addition, this statement amends the disclosure
requirements of SFAS No. 123 to require prominent disclosures in both annual and
interim financial statements about the method of accounting for stock-based
employee compensation and the effect of the method used on reported results. As
FHN continues to account for stock-based employee compensation under APB 25, the
adoption of this statement did not have a material impact on the financial
statements or results of operations.

On October 1, 2002, FHN adopted SFAS No. 147, 'Acquisitions of Certain Financial
Institutions (an amendment of FASB Statement No. 72 and 144 and FASB
Interpretation No. 9)'. This statement requires acquisitions of all or part of a
financial institution meeting the definition of a business combination to be
accounted for by the purchase method in accordance with SFAS No. 141. Any
previously recorded unidentified intangible asset related to the acquisition of
a financial institution must now be classified as goodwill and is subject to the
impairment testing provisions of SFAS No. 142. Impairment testing of previously
identified long-term customer-relationship intangible assets will be subject to
the impairment testing provisions of SFAS No. 144. Provisions of this statement
were effective for acquisitions on or after October 1, 2002. The impact of
adopting this statement was immaterial to FHN.

On October 1, 2002, FHN adopted SFAS No. 145, 'Rescission of FASB Statements No.
4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections'.
SFAS No. 145 rescinds SFAS No. 4, which required all gains and losses from
extinguishment of debt to be classified as an extraordinary item, net of related
income tax effect, if material in the aggregate. Due to the rescission of SFAS
No. 4, the criteria in Opinion 30 are now used to classify those gains and
losses. SFAS No. 64 amended SFAS No. 4, and is no longer necessary because of
the rescission of SFAS No. 4. SFAS No. 44, is no longer necessary because the
transition of the Motor Carrier Act of 1980 has been completed. SFAS No. 145
also amends SFAS No. 13 to require that certain lease modifications that have
economic effects similar to sale-leaseback transactions be accounted for in the
same manner as sale-leaseback transactions. In addition this statement also
makes technical corrections to existing pronouncements which are generally not
substantive in nature. The adoption of this standard resulted in a loss of $5.1
million related to a 2001 debt restructuring being reclassified as noninterest
expense. This item had previously been presented, net of taxes ($1.9 million),
as an

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extraordinary item on the Consolidated Statements of Income. In 2002, a debt
restructuring resulted in a $3.7 million pre-tax loss.

On January 1, 2002, FHN adopted SFAS No. 144, 'Accounting for the Impairment or
Disposal of Long-Lived Assets'. SFAS No. 144 addresses accounting and reporting
issues related to the impairment of long-lived assets and for long-lived assets
to be disposed of. The impact of adopting this statement was immaterial to FHN.

On January 1, 2002, FHN adopted SFAS No. 142, 'Goodwill and Other Intangible
Assets'. Under SFAS No. 142, goodwill is no longer subject to amortization over
its estimated useful life, but is subject to an assessment for impairment using
a fair-value-based test at least annually. FHN has not recognized any impairment
of the goodwill currently on its books during 2004, 2003, or 2002.

On January 1, 2002, FHN adopted the final provisions of SFAS No. 141, 'Business
Combinations' which requires that all business combinations initiated after June
30, 2001, be accounted for using the purchase method. The impact of adopting
this statement was immaterial to FHN.

In December 2004, the FASB issued SFAS No. 123 (revised 2004), 'Share-Based
Payment' (SFAS No. 123-R), which requires recognition of expense over the
requisite service period for awards of share-based compensation to employees.
SFAS No. 123-R must be adopted no later than July 1, 2005 with earlier adoption
permitted. As permitted by the original SFAS No. 123, FHN has accounted for its
equity awards under the provisions of APB No. 25. Upon adoption of SFAS No.
123-R, the grant date fair value of an award will be used to measure the
compensation expense recognized for the award. For unvested awards granted prior
to the adoption of SFAS 123-R, the fair values utilized will equal the values
used in preparation of the disclosures required under the original SFAS 123.
Compensation expense recognized after adoption of SFAS 123-R will incorporate an
estimate of awards expected to ultimately vest, which requires estimation of
forfeitures as well as projections related to the satisfaction of performance
conditions that determine vesting. Upon initial adoption of SFAS 123-R, FHN is
required to reclassify deferred compensation debit balances to capital surplus
and to make a cumulative effect entry for outstanding unvested awards that are
not expected to vest due to anticipated forfeiture. SFAS 123-R permits
restatement of prior period financial statements using the amounts from prior
SFAS 123 disclosures.

In October 2003, the FASB approved the AICPA's issuance of SOP 03-3, 'Accounting
for Loans or Certain Debt Securities Acquired in a Transfer', which modifies the
accounting for certain loans that are acquired with evidence of deterioration in
credit quality since origination. SOP 03-3 does not apply to loans recorded at
fair value, to revolving loans, or to mortgage loans classified as held for
sale. SOP 03-3 limits the yield that may be accreted on applicable loans to the
excess of the cash flows expected, at acquisition, to be collected over the
investor's initial investment in the loan. SOP 03-3 also prohibits the 'carrying
over' of valuation allowances on applicable loans. SOP 03-3 is effective for
fiscal years beginning after December 15, 2004. The impact at implementation of
adopting SOP 03-3 is expected to be immaterial to the results of future
operations.

NOTE 2 - ACQUISITIONS/DIVESTITURES

On January 7, 2005, FHN's capital markets division, FTN Financial, completed the
acquisition of the assets and operations of the fixed income business of Spear,
Leeds & Kellogg (SLK), a division of Goldman Sachs & Co. for approximately
$150.0 million in cash. The acquisition is expected to be accretive to FHN's
earnings per share during 2005.

On December 31, 2004, Synaxis Group, Inc., a subsidiary of FTBNA, completed the
sale of substantially all the assets of Mann, Smith & Cummings, Inc. of
Clarksville, TN. This transaction resulted in a divestiture gain of $1.2
million.

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<Page>



NOTE 2 - ACQUISITIONS/DIVESTITURES (CONTINUED)

On September 23, 2004, FTN Midwest Securities Corp., a wholly-owned subsidiary
of FTBNA, acquired certain assets and assumed certain liabilities of Alterity
Partners, LLC, a mergers and acquisitions advisory services company based in New
York, New York, for approximately $8.0 million in cash. The acquisition was
immaterial to FHN.

On June 29, 2004, First Horizon Merchant Services, Inc., a wholly owned
subsidiary of FTBNA, recognized a divestiture gain of $1.8 million resulting
from the sale of certain merchant relationships to Humboldt Merchant Services,
LP, of Eureka, California (an affiliate of First National Bank of Nevada, Reno,
Nevada).

On December 31, 2003, FHN completed the sale of substantially all of the assets
and liabilities of its wholly owned subsidiary, First National Bank of
Springdale (FNB) of Springdale, Arkansas to First Security Bank of Searcy,
Arkansas. This transaction resulted in a divestiture gain of $12.5 million.
Immediately preceding the sale, FNB had investment securities of approximately
$125 million, loans of approximately $165 million, deposits of approximately
$300 million and equity of approximately $40 million.

On December 31, 2003, First Horizon Merchant Services, Inc. recognized a
divestiture gain of $10.0 million resulting from the sale of certain merchant
relationships referred by selected agent banks within the merchant portfolio to
NOVA Information Systems, Inc., a subsidiary of U.S. Bancorp. During 2004,
divestiture gains of $4.0 million resulted from an earn-out on the 2003 sale of
merchant relationships.

On August 1, 2003, First Horizon Merchant Services, Inc. acquired Global Card
Services, Inc., a merchant processing company based in Orlando, Florida, for
approximately $15.8 million in cash. The acquisition was immaterial to FHN.

On September 16, 2002, FTBNA, the primary banking subsidiary of FHN, sold a
portfolio of loans originated through First Horizon Money Centers totaling
$208.3 million to American General Finance, Inc. of Evansville, Indiana and
closed the related Money Center offices. This transaction resulted in a
divestiture gain of $2.3 million.

On June 1, 2002, First Horizon Home Loans, a wholly owned subsidiary of FTBNA,
acquired certain assets and assumed certain liabilities of Real Estate Financial
Services, a mortgage lending company based in Alpharetta, Georgia, for
approximately $2.2 million in cash. The acquisition was immaterial to FHN.

On April 1, 2002, First Horizon Merchant Services, Inc. acquired First Premier
Financial Services, Inc. (First Premier), a South Dakota based merchant
processor, for approximately $11.9 million in cash. First Premier was merged
into First Horizon Merchant Services, Inc. The acquisition was immaterial to
FHN.

In addition to the acquisitions mentioned above, FHN also acquires assets from
time to time in transactions that are considered business combinations but are
not material to FHN individually or in the aggregate.

First Horizon National Corporation     71









<Page>



NOTE 3 - INVESTMENT SECURITIES

The following tables summarize FHN's securities held to maturity and available
for sale on December 31, 2004 and 2003:

<Table>
<Caption>
                                                                            ON DECEMBER 31, 2004*
                                                              -------------------------------------------------
                                                                             Gross        Gross
                                                              Amortized    Unrealized   Unrealized      Fair
(Dollars in thousands)                                           Cost        Gains        Losses        Value
- ---------------------------------------------------------------------------------------------------------------
<S>                                                           <C>          <C>          <C>          <C>
SECURITIES HELD TO MATURITY:
States and municipalities                                     $      441     $   16      $      -    $      457
- ---------------------------------------------------------------------------------------------------------------
Total securities held to maturity                             $      441     $   16      $      -    $      457
===============================================================================================================
SECURITIES AVAILABLE FOR SALE:
U.S. Treasuries                                               $   41,423     $   11      $   (190)   $   41,244
Government agency issued MBS**                                   881,888        668        (7,937)      874,619
Government agency issued CMO**                                 1,521,088      1,505        (6,050)    1,516,543
Other U.S. government agencies**                                  40,794        165             -        40,959
States and municipalities                                          7,704        125            (2)        7,827
Other                                                              7,272        105            (7)        7,370
Equity                                                           191,994          8            (8)      191,994
- ---------------------------------------------------------------------------------------------------------------
Total securities available for sale                           $2,692,163     $2,587      $(14,194)   $2,680,556
===============================================================================================================
</Table>

 * Includes $2.4 billion of securities pledged to secure public deposits,
   securities sold under agreements to repurchase and for other purposes.
** Includes securities issued by government sponsored entities which are not
   backed by the full faith and credit of the U.S. government.

<Table>
<Caption>
                                                                            On December 31, 2003*
                                                              -------------------------------------------------
                                                                             Gross        Gross
                                                              Amortized    Unrealized   Unrealized      Fair
(Dollars in thousands)                                           Cost        Gains        Losses        Value
- ---------------------------------------------------------------------------------------------------------------
<S>                                                           <C>          <C>          <C>          <C>
SECURITIES HELD TO MATURITY:
States and municipalities                                     $    1,028    $    49      $      -    $    1,077
- ---------------------------------------------------------------------------------------------------------------
Total securities held to maturity                             $    1,028    $    49      $      -    $    1,077
===============================================================================================================
SECURITIES AVAILABLE FOR SALE:
U.S. Treasuries                                               $   47,769    $   219      $    (11)   $   47,977
Government agency issued MBS**                                   957,236      6,234        (9,449)      954,021
Government agency issued CMO**                                 1,239,596     11,234        (3,989)    1,246,841
Other U.S. government agencies**                                   1,092         72             -         1,164
States and municipalities                                         13,076        321            (2)       13,395
Other                                                             16,600        754           (13)       17,341
Equity                                                           188,793        227          (417)      188,603
- ---------------------------------------------------------------------------------------------------------------
Total securities available for sale                           $2,464,162    $19,061      $(13,881)   $2,469,342
===============================================================================================================
</Table>

 * Includes $2.1 billion of securities pledged to secure public deposits,
   securities sold under agreements to repurchase and for other purposes.
** Includes securities issued by government sponsored entities which are not
   backed by the full faith and credit of the U.S. government.
Certain previously reported amounts have been reclassified to agree with current
presentation.

                                       72     First Horizon National Corporation





<Page>



NOTE 3 - INVESTMENT SECURITIES (CONTINUED)

Provided below are the amortized cost and fair value by contractual maturity for
the securities portfolios on December 31, 2004:

<Table>
<Caption>
                                                              Held to Maturity      Available for Sale
                                                              -----------------   -----------------------
                                                              Amortized   Fair    Amortized       Fair
(Dollars in thousands)                                          Cost      Value      Cost         Value
- ---------------------------------------------------------------------------------------------------------
<S>                                                           <C>         <C>     <C>          <C>

Within 1 year                                                   $ 35      $ 35    $   45,675   $   45,550
After 1 year; within 5 years                                     406       422         3,399        3,449
After 5 years; within 10 years                                     -         -        41,409       41,572
After 10 years                                                     -         -         6,710        6,829
- ---------------------------------------------------------------------------------------------------------
 Subtotal                                                        441       457        97,193       97,400
- ---------------------------------------------------------------------------------------------------------
Government agency issued MBS and CMO                               -         -     2,402,976    2,391,162
Equity securities                                                  -         -       191,994      191,994
- ---------------------------------------------------------------------------------------------------------
Total                                                           $441      $457    $2,692,163   $2,680,556
=========================================================================================================
</Table>

Expected maturities will differ from contractual maturities because borrowers
may have the right to call or prepay obligations with or without call or
prepayment penalties.

The table below provides information on realized gross gains and realized gross
losses on sales from the available for sale portfolio for the years ended
December 31:

<Table>
<Caption>

(Dollars in thousands)                                        AFS Debt*   AFS Equity*    Total
- -----------------------------------------------------------------------------------------------
<S>                                                           <C>         <C>           <C>
2004
Gross gains on sales                                           $18,712      $ 6,593     $25,305
Gross losses on sales                                               (4)        (653)       (657)
- -----------------------------------------------------------------------------------------------
2003
Gross gains on sales                                           $   847      $11,444     $12,291
Gross losses on sales                                           (6,973)           -      (6,973)
- -----------------------------------------------------------------------------------------------
2002
Gross gains on sales                                           $ 1,309      $    43     $ 1,352
Gross losses on sales                                           (1,056)           -      (1,056)
- -----------------------------------------------------------------------------------------------
</Table>

* AFS - Available for sale

Losses totaling $3.9 million, $3.0 million and $9.5 million for the years 2004,
2003 and 2002, respectively, were recognized for securities that, in the opinion
of management, have been other-than-temporarily impaired.

First Horizon National Corporation     73





<Page>



NOTE 3 - INVESTMENT SECURITIES (CONTINUED)

The following table provides information on investments that have unrealized
losses on December 31, 2004:

<Table>
<Caption>
                                                                           ON DECEMBER 31, 2004
                                                ---------------------------------------------------------------------------
                                                  Less than 12 months       12 Months or Longer              Total
                                                -----------------------   -----------------------   -----------------------
                                                             Unrealized                Unrealized                Unrealized
(Dollars in thousands)                          Fair Value     Losses     Fair Value     Losses     Fair Value     Losses
- ---------------------------------------------------------------------------------------------------------------------------
<S>                                             <C>          <C>          <C>          <C>          <C>          <C>
U.S. Treasuries                                 $   34,901    $   (181)    $   170       $  (9)     $   35,071    $   (190)
Government agency issued MBS                       832,535      (7,655)     16,192        (282)        848,727      (7,937)
Government agency issued CMO                       908,590      (6,050)          -           -         908,590      (6,050)
State and municipalities                               663          (2)          -           -             663          (2)
Other                                                  861          (7)          -           -             861          (7)
- ---------------------------------------------------------------------------------------------------------------------------
Total debt securities                            1,777,550     (13,895)     16,362        (291)      1,793,912     (14,186)
Equity                                                 226          (8)          -           -             226          (8)
- ---------------------------------------------------------------------------------------------------------------------------
Total temporarily impaired securities           $1,777,776    $(13,903)    $16,362       $(291)     $1,794,138    $(14,194)
===========================================================================================================================
</Table>

On December 31, 2004, FHN held two investment securities having continuous
unrealized loss positions for more than 12 months. The unrealized losses were
related to changes in interest rates. FHN has both the intent and ability to
hold these securities for the time necessary to recover the amortized cost. FHN
has not recognized any other-than-temporary impairment in connection with these
securities.

On December 31, 2004, FHN had $124.0 million of cost method investments
including $94.1 million of Federal Reserve Bank and Federal Home Loan Bank
stock. These investments, which do not have a readily determinable market and
for which it is not practicable to estimate a fair value, are evaluated for
impairment only if there are identified events or changes in circumstances that
may have had a significant adverse effect on the fair value of the investment.

                                      74     First Horizon National Corporation









<Page>



NOTE 4 - LOANS

A summary of the major categories of loans outstanding on December 31 is shown
below:

<Table>
<Caption>

(Dollars in thousands)                                           2004              2003
- -------------------------------------------------------------------------------------------
<S>                                                           <C>               <C>
Commercial:
   Commercial, financial and industrial                       $ 5,560,736       $ 4,502,917
   Real estate commercial                                         960,178           968,064
   Real estate construction                                     1,208,703           690,402
Retail:
   Real estate residential                                      7,244,716         6,817,122
   Real estate construction                                     1,035,562           527,260
   Other retail                                                   168,806           212,362
   Credit card receivables                                        248,972           272,398
- -------------------------------------------------------------------------------------------
   Loans, net of unearned income                               16,427,673        13,990,525
Allowance for loan losses                                         158,159           160,333
- -------------------------------------------------------------------------------------------
Total net loans                                               $16,269,514       $13,830,192
===========================================================================================
</Table>


On December 31, 2004, $1.4 billion of real estate residential qualifying loans
were pledged to secure potential Federal Home Loan Bank borrowings. Qualifying
loans are comprised of residential mortgage loans secured by first and second
liens and home equity lines of credit. In addition, $2.9 billion of commercial,
financial and industrial loans were pledged to secure potential discount window
borrowings from the Federal Reserve Bank.

Nonperforming loans consist of loans which management has identified as
impaired, other nonaccrual loans and loans which have been restructured. On
December 31, 2004 and 2003, there were no outstanding commitments to advance
additional funds to customers whose loans had been restructured. The following
table presents nonperforming loans on December 31:

<Table>
<Caption>

(Dollars in thousands)                                           2004              2003
- -------------------------------------------------------------------------------------------
<S>                                                           <C>               <C>
Impaired loans                                                   $ 34,831          $ 34,369
Other nonaccrual loans*                                            14,729            17,415
- -------------------------------------------------------------------------------------------
Total nonperforming loans                                        $ 49,560          $ 51,784
===========================================================================================
</Table>

* On December 31, 2004 and 2003, other nonaccrual loans included $8.5 million
  and $8.8 million, respectively, of loans held for sale.

Interest income received during 2004 for impaired loans was $.5 million and for
other nonaccrual loans was $.1 million. Under their original terms, interest
income would have been approximately $2.6 million for the impaired loans and
$1.0 million for the other nonaccrual loans outstanding on December 31, 2004.
Interest income received during 2003 for impaired loans was $.4 million and for
other nonaccrual loans was $14,000. Under their original terms, interest income
would have been approximately $2.9 million for the impaired loans and $.7
million for the other nonaccrual loans outstanding on December 31, 2003.
Interest income received during 2002 for impaired loans was $1.6 million and for
other nonaccrual loans was $.4 million. Under their original terms, interest
income would have been approximately $4.7 million for the impaired loans and
$1.3 million for the other nonaccrual loans outstanding on December 31, 2002.
The average balance of impaired loans was approximately $36.9 million for 2004,
$45.4 million for 2003 and $44.1 million for 2002. All impaired loans have an
associated allowance for loan loss.

First Horizon National Corporation     75





<Page>



NOTE 4 - LOANS (CONTINUED)

Activity in the allowance for loan losses related to non-impaired and impaired
loans for years ended December 31 is summarized as follows:

<Table>
<Caption>

(Dollars in thousands)                                        Non-impaired   Impaired     Total
- -------------------------------------------------------------------------------------------------
<S>                                                           <C>            <C>        <C>
Balance on December 31, 2001                                   $ 133,668     $ 16,946   $ 150,614
Provision for loan losses                                         54,955       37,229      92,184
Charge-offs                                                      (72,973)     (40,168)   (113,141)
Loan recoveries                                                   13,579        1,062      14,641
- -------------------------------------------------------------------------------------------------
 Net charge-offs                                                 (59,394)     (39,106)    (98,500)
- -------------------------------------------------------------------------------------------------
Balance on December 31, 2002                                     129,229       15,069     144,298
- -------------------------------------------------------------------------------------------------
Adjustment due to divestiture                                     (2,652)           -      (2,652)
Provision for loan losses                                         73,249       13,449      86,698
Charge-offs                                                      (63,113)     (19,323)    (82,436)
Loan recoveries                                                   12,440        1,985      14,425
- -------------------------------------------------------------------------------------------------
 Net charge-offs                                                 (50,673)     (17,338)    (68,011)
- -------------------------------------------------------------------------------------------------
Balance on December 31, 2003                                     149,153       11,180     160,333
- -------------------------------------------------------------------------------------------------
Loans transferred to held for sale                                (8,382)           -      (8,382)
Provision for loan losses                                         40,402        7,946      48,348
Charge-offs                                                      (45,772)     (10,857)    (56,629)
Loan recoveries                                                   12,271        2,218      14,489
- -------------------------------------------------------------------------------------------------
 Net charge-offs                                                 (33,501)      (8,639)    (42,140)
- -------------------------------------------------------------------------------------------------
BALANCE ON DECEMBER 31, 2004                                   $ 147,672     $ 10,487   $ 158,159
=================================================================================================
</Table>

Included in other assets and in other liabilities on the Consolidated Statements
of Condition are amounts due from customers on acceptances and bank acceptances
outstanding of $9.2 million and $3.0 million on December 31, 2004 and 2003,
respectively. In 2004, FHN transferred approximately $1.6 billion of real estate
residential loans to held for sale.

                                       76     First Horizon National Corporation








<Page>



NOTE 5 - PREMISES, EQUIPMENT AND LEASES

Premises and equipment on December 31 are summarized below:

<Table>
<Caption>

(Dollars in thousands)                                          2004       2003
- ---------------------------------------------------------------------------------
<S>                                                           <C>        <C>
Land                                                          $ 51,253   $ 48,391
Buildings                                                      267,362    239,353
Leasehold improvements                                          58,999     52,770
Furniture, fixtures and equipment                              316,082    307,067
- ---------------------------------------------------------------------------------
 Premises and equipment, at cost                               693,696    647,581
Less accumulated depreciation and amortization                 314,337    297,379
- ---------------------------------------------------------------------------------
Premises and equipment, net                                   $379,359   $350,202
=================================================================================
</Table>

FHN is obligated under a number of noncancelable operating leases for premises
and equipment with terms up to 25 years, which may include the payment of taxes,
insurance and maintenance costs.

Minimum future lease payments for noncancelable operating leases on premises and
equipment on December 31, 2004, are shown below:

<Table>
<Caption>

(Dollars in thousands)
- ----------------------------------------------------------------------
<S>                                                           <C>
2005                                                          $ 59,084
2006                                                            52,427
2007                                                            43,195
2008                                                            30,049
2009                                                            19,894
2010 and after                                                  40,471
- ----------------------------------------------------------------------
Total minimum lease payments                                  $245,120
======================================================================
</Table>

Payments required under capital leases are not material.

Aggregate minimum income under sublease agreements for these periods is $7.3
million.

Rent expense incurred under all operating lease obligations was as follows for
the years ended December 31:

<Table>
<Caption>

(Dollars in thousands)                                         2004      2003      2002
- -----------------------------------------------------------------------------------------
<S>                                                           <C>       <C>       <C>
Rent expense, gross                                           $69,581   $64,260   $67,457
Rent income                                                    (3,217)   (4,543)   (5,959)
- -----------------------------------------------------------------------------------------
Rent expense, net                                             $66,364   $59,717   $61,498
=========================================================================================
</Table>

First Horizon National Corporation     77





<Page>



NOTE 6 - MORTGAGE SERVICING RIGHTS

Following is a summary of changes in capitalized mortgage servicing rights
(MSR), net of accumulated amortization, included in the Consolidated Statements
of Condition:

<Table>
<Caption>

(Dollars in thousands)
- ------------------------------------------------------------------------
<S>                                                           <C>
December 31, 2001                                             $  665,005
Addition of mortgage servicing rights                            401,972
Amortization                                                    (117,841)
Market value adjustments                                        (358,492)
Permanent impairment                                            (131,695)
Increase in valuation allowance                                  (18,467)
- ------------------------------------------------------------------------
December 31, 2002                                                440,482
Addition of mortgage servicing rights                            536,655
Amortization                                                    (132,273)
Market value adjustments                                         115,673
Sales of mortgage servicing rights                                (6,275)
Permanent impairment                                            (155,586)
Increase in valuation allowance                                   (2,738)
- ------------------------------------------------------------------------
December 31, 2003                                                795,938
Addition of mortgage servicing rights                            450,826
Amortization                                                    (154,301)
Market value adjustments                                         (18,943)
Permanent impairment                                             (69,299)
Decrease in valuation allowance                                   32,237
- ------------------------------------------------------------------------
DECEMBER 31, 2004                                             $1,036,458
========================================================================
</Table>

MSR on December 31, 2004, 2003 and 2002 had estimated market values of
approximately $1,049.7 million, $838.5 million and $464.1 million, respectively.
These balances represent the rights to service approximately $83.6 billion,
$65.1 billion and $50.0 billion of mortgage loans on December 31, 2004, 2003 and
2002, respectively. On December 31, 2004, 2003 and 2002 valuation allowances due
to impairment of $4.2 million, $36.5 million and $33.7 million were required,
respectively. Following is a rollforward of the valuation allowance:

<Table>
<Caption>

(Dollars in thousands)
- ----------------------------------------------------------------------
<S>                                                           <C>
Balance on December 31, 2001                                  $ 15,263
Permanent impairment                                          (131,695)
Servicing valuation provision                                  150,162
- ----------------------------------------------------------------------
Balance on December 31, 2002                                  $ 33,730
Permanent impairment                                          (155,586)
Servicing valuation provision                                  158,324
- ----------------------------------------------------------------------
Balance on December 31, 2003                                  $ 36,468
Permanent impairment                                           (69,299)
Servicing valuation provision                                   37,062
- ----------------------------------------------------------------------
BALANCE ON DECEMBER 31, 2004                                  $  4,231
======================================================================
</Table>

                                       78     First Horizon National Corporation





<Page>



NOTE 6 - MORTGAGE SERVICING RIGHTS (CONTINUED)

Estimated MSR amortization expense for the years ending 2005, 2006, 2007, 2008
and 2009 are $163.2 million, $140.6 million, $119.0 million, $99.8 million, and
$82.9 million, respectively. The assumptions underlying these estimates are
subject to modification based on changes in market conditions and portfolio
behavior (such as prepayment speeds). As a result, these estimates are subject
to change in a manner and amount that is not presently determinable by
management.

For purposes of impairment evaluation and measurement, the MSR are stratified
based on the predominant risk characteristics of the underlying loans. These
strata currently include adjustable and fixed rate loans. The MSR are amortized
over the period of and in proportion to the estimated net servicing revenues. A
quarterly impairment analysis is performed using a discounted cash flow
methodology that is disaggregated by predominant risk characteristics.
Impairment, if any, is recognized through a valuation allowance for individual
strata. However, if the impairment is determined to be other-than-temporary, a
direct write-off of the asset is made.



First Horizon National Corporation     79








<Page>



NOTE 7 - INTANGIBLE ASSETS

Following is a summary of intangible assets, net of accumulated amortization,
included in the Consolidated Statements of Condition:

<Table>
<Caption>
                                                                               Other
                                                                             Intangible
(Dollars in thousands)                                        Goodwill         Assets*
- ---------------------------------------------------------------------------------------
<S>                                                           <C>            <C>
December 31, 2001                                             $143,147        $ 41,857
Amortization expense                                                 -          (6,200)
Reclass**                                                       12,359         (12,359)
Minimum pension liability adjustment                                 -           1,124
Acquisitions**                                                   9,111           5,226
- ---------------------------------------------------------------------------------------
December 31, 2002                                              164,617          29,648
- ---------------------------------------------------------------------------------------
Amortization expense                                                 -          (7,980)
Minimum pension liability adjustment                                 -             (89)
Divestitures                                                   (13,303)         (1,632)
Acquisitions**                                                  23,493          18,795
- ---------------------------------------------------------------------------------------
December 31, 2003                                              174,807          38,742
- ---------------------------------------------------------------------------------------
Amortization expense                                                 -          (9,541)
Minimum pension liability adjustment                                 -            (129)
Divestitures                                                      (810)           (359)
Acquisitions**                                                  13,203           6,056
- ---------------------------------------------------------------------------------------
DECEMBER 31, 2004                                             $187,200        $ 34,769
=======================================================================================
</Table>

 * Represents customer lists, premium on purchased deposits, covenants not to
   compete and assets related to the minimum pension liability.
** Preliminary purchase price allocations on acquisitions are based upon
   estimates of fair value and are subject to change.

The gross carrying amount of other intangible assets subject to amortization is
$104.0 million on December 31, 2004, net of $69.2 million of accumulated
amortization. Estimated aggregate amortization expense is expected to be $8.7
million, $6.2 million, $5.8 million, $4.8 million, and $3.5 million for 2005,
2006, 2007, 2008 and 2009, respectively.

The following is a summary of goodwill, net of accumulated amortization,
detailed by reportable segments for the three years ended December 31, 2004:

<Table>
<Caption>
                                                               Retail/
                                                              Commercial   Mortgage   Capital
(Dollars in thousands)                                         Banking     Banking    Markets    Total
- --------------------------------------------------------------------------------------------------------
<S>                                                           <C>          <C>        <C>       <C>
December 31, 2001                                              $ 78,826    $51,353    $12,968   $143,147
Reclass*                                                         12,359          -          -     12,359
Acquisitions*                                                     7,760      1,025        326      9,111
- --------------------------------------------------------------------------------------------------------
December 31, 2002                                                98,945     52,378     13,294    164,617
- --------------------------------------------------------------------------------------------------------
Divestitures                                                    (13,303)         -          -    (13,303)
Acquisitions*                                                    23,883       (390)         -     23,493
- --------------------------------------------------------------------------------------------------------
December 31, 2003                                               109,525     51,988     13,294    174,807
- --------------------------------------------------------------------------------------------------------
Divestitures                                                       (810)         -          -       (810)
Acquisitions*                                                     5,626      3,226      4,351     13,203
- --------------------------------------------------------------------------------------------------------
DECEMBER 31, 2004                                              $114,341    $55,214    $17,645   $187,200
========================================================================================================
</Table>

* Preliminary purchase price allocations on acquisitions are based upon
  estimates of fair value and are subject to change.

                                       80     First Horizon National Corporation





<Page>



NOTE 8 - TIME DEPOSIT MATURITIES

Following is a table of maturities for time deposits outstanding on December 31,
2004, which include 'Certificates of deposit under $100,000 and other time' and
'Certificates of deposit $100,000 and more'. 'Certificates of deposit $100,000
and more' totaled $8.2 billion on December 31, 2004. Time deposits are included
in 'Interest-bearing' deposits on the Consolidated Statements of Condition.

<Table>
<Caption>

(Dollars in thousands)
- -------------------------------------------------------------------------
<S>                                                           <C>
2005                                                          $ 8,445,181
2006                                                              805,582
2007                                                              258,607
2008                                                               85,520
2009                                                              357,869
2010 and after                                                    324,679
- -------------------------------------------------------------------------
Total                                                         $10,277,438
=========================================================================
</Table>


NOTE 9 - SHORT-TERM BORROWINGS

Short-term borrowings include federal funds purchased and securities sold under
agreements to repurchase, commercial paper, and other borrowed funds which
include short sale borrowings.

Federal funds purchased and securities sold under agreements to repurchase and
commercial paper generally have maturities of less than 90 days. Other
short-term borrowings have original maturities of one year or less.

The detail of these borrowings for the years 2004, 2003 and 2002 is presented in
the following table:

<Table>
<Caption>
                                                         Federal Funds
                                                         Purchased and
                                                        Securities Sold                           Other
                                                        Under Agreements       Commercial       Short-term
(Dollars in thousands)                                   to Repurchase           Paper          Borrowings
- ----------------------------------------------------------------------------------------------------------------
<S>                                                        <C>                  <C>              <C>
2004
Average balance                                            $3,685,153           $20,385          $593,745
Year-end balance                                            3,247,048            23,712           482,044
Maximum month-end outstanding                               4,387,946            30,885           947,002
Average rate for the year                                        1.22%              .89%             3.79%
Average rate at year-end                                         1.87              1.18              3.44
- ----------------------------------------------------------------------------------------------------------------
2003
Average balance                                            $3,712,768           $20,902          $638,961
Year-end balance                                            3,079,248            31,793           196,183
Maximum month-end outstanding                               4,703,454            31,793           988,855
Average rate for the year                                         .99%              .93%             3.92%
Average rate at year-end                                          .79               .78              4.07
- ----------------------------------------------------------------------------------------------------------------
2002
Average balance                                            $3,134,379           $19,899          $517,499
Year-end balance                                            3,126,350            25,695           335,513
Maximum month-end outstanding                               4,283,364            26,461           625,299
Average rate for the year                                        1.45%             1.31%             4.24%
Average rate at year-end                                          .99               .98              3.14
- ----------------------------------------------------------------------------------------------------------------
</Table>

On December 31, 2004, $50 million of borrowings under unsecured lines of credit
from non-affiliated banks were available to the parent company to provide for
general liquidity needs at an annual facility fee of .10 percent.

First Horizon National Corporation     81







<Page>


NOTE 10 - TERM BORROWINGS

The following table presents information pertaining to term borrowings (debt
with original maturities greater than one year) for FHN and its subsidiaries on
December 31:

<Table>
<Caption>
(Dollars in thousands)                                           2004         2003
- -------------------------------------------------------------------------------------
<S>                                                           <C>          <C>
FIRST TENNESSEE BANK NATIONAL ASSOCIATION:
Subordinated notes (qualifies for total capital under the
  Risk-Based Capital guidelines):
 Matures on January 15, 2015  -  5.05%                        $  400,872   $        -
 Matures on May 15, 2013  -  4.625%                              258,837      257,529
 Matures on December 1, 2008  -  5.75%                           140,402      141,191
 Matures on April 1, 2008  -  6.40%                               89,771       89,701
Bank notes*                                                    1,249,950      959,847
Federal Home Loan Bank borrowings**                                4,717        3,897
Other***                                                           1,259          280
FIRST HORIZON NATIONAL CORPORATION:
Subordinated capital notes (qualifies for total capital
  under the Risk-Based Capital guidelines):
 Matures on May 15, 2013  -  4.50%                               103,601      103,229
 Matures on November 15, 2005  -  6.75%                           22,875       22,850
Subordinated notes (Note 11):
 Matures on January 6, 2027  -  8.07%                            101,064      103,093
 Matures on April 15, 2034  -  6.30%                             197,803            -
FT REAL ESTATE SECURITIES COMPANY, INC.
Cumulative preferred stock (qualifies for total capital
  under the Risk-Based Capital guidelines) (Note 12):
 Matures on March 31, 2031  -  9.50%                              45,217       45,149
- -------------------------------------------------------------------------------------
Total                                                         $2,616,368   $1,726,766
=====================================================================================
</Table>

  * The bank notes were issued with variable interest rates and have remaining
    terms of 1 to 3 years. These bank notes had weighted average interest rates
    of 2.35 percent and 1.21 percent on December 31, 2004 and 2003,
    respectively.
 ** The Federal Home Loan Bank (FHLB) borrowings were issued with fixed interest
    rates and have remaining terms of 4 to 25 years. These borrowings had
    weighted average interest rates of 3.57 percent and 4.29 percent on December
    31, 2004 and 2003, respectively.
*** Other long-term debt is comprised of unsecured obligations issued with fixed
    interest rates and have remaining terms of approximately one year. These
    borrowings had a weighted average interest rate of 5.00 percent on December
    31, 2004 and 2003.

Annual principal repayment requirements as of December 31, 2004, are as follows:

<Table>
<Caption>
(Dollars in thousands)
- ------------------------------------------------------------------------
<S>                                                           <C>
2005                                                          $1,074,490
2006                                                             150,334
2007                                                              50,334
2008                                                             231,959
2009                                                                 317
2010 and after                                                 1,109,343
- ------------------------------------------------------------------------
</Table>

All subordinated notes are unsecured and are subordinate to other present and
future senior indebtedness. FTBNA's subordinated notes and FHN's subordinated
capital notes qualify as Tier 2 risk-based capital under the Office of the
Comptroller of the Currency and Federal Reserve Board guidelines for assessing
capital adequacy. FTBNA's subordinated and bank notes may not be redeemed or
prepaid prior to maturity. FTBNA has an ongoing bank note program under which
the bank may offer an aggregate principal amount of up to $3.0 billion. On
December 31, 2004, unused term-

                                       82     First Horizon National Corporation





<Page>


NOTE 10 - TERM BORROWINGS (CONTINUED)

borrowing capacity under this program was $.1 billion. In February 2005, FTBNA
entered into a $5.0 billion bank note program. This bank note program provides
FTBNA with a facility under which it may continuously issue and offer short- and
medium-term unsecured notes. The existing bank note program has been terminated
in connection with the establishment of the new program. That termination does
not affect any previously-issued notes outstanding.

NOTE 11 - GUARANTEED PREFERRED BENEFICIAL INTERESTS IN FIRST HORIZON'S JUNIOR
SUBORDINATED DEBENTURES

On December 30, 1996, FHN, through its underwriters, sold to institutional
investors $100 million of capital securities. First Tennessee Capital I (Capital
I), a Delaware business trust wholly owned by FHN, issued $100 million of
Capital Securities, Series A at 8.07 percent. The proceeds were loaned to FHN as
junior subordinated debt. FHN has, through various contractual arrangements,
fully and unconditionally guaranteed all of Capital I's obligations with respect
to the capital securities. The sole asset of Capital I is $103 million of junior
subordinated debentures issued by FHN. These junior subordinated debentures also
carry an interest rate of 8.07 percent. Both the capital securities of Capital I
and the junior subordinated debentures of FHN will mature on January 6, 2027;
however, under certain circumstances, the maturity of both may be shortened to a
date not earlier than January 6, 2017. The capital securities qualify as Tier 1
capital. The junior subordinated debentures are included in the Consolidated
Statements of Condition in 'Term borrowings' (see Note 10  -  Term Borrowings).

During first quarter 2004, FHN, through its underwriter, sold $200 million of
capital securities. First Tennessee Capital II (Capital II), a Delaware business
trust wholly owned by FHN, issued $200 million of Capital Securities, Series B
at 6.30 percent. The proceeds were loaned to FHN as junior subordinated debt.
FHN has, through various contractual arrangements, fully and unconditionally
guaranteed all of Capital II's obligations with respect to the capital
securities. The sole asset of Capital II is $206 million of junior subordinated
debentures issued by FHN. These junior subordinated debentures also carry an
interest rate of 6.30 percent. Both the capital securities of Capital II and the
junior subordinated debentures of FHN will mature on April 15, 2034, however,
under certain circumstances, the maturity of both may be shortened to a date not
earlier than April 15, 2009. The capital securities qualify as Tier 1 capital.
The junior subordinated debentures are included in the Consolidated Statements
of Condition in 'Term borrowings' (see Note 10  -  Term Borrowings).

NOTE 12 - PREFERRED STOCK OF SUBSIDIARY

On September 14, 2000, FT Real Estate Securities Company, Inc. (FTRESC), an
indirect subsidiary of FHN, issued 50 shares of 9.50% Cumulative Preferred
Stock, Class B (Class B Preferred Shares), with a liquidation preference of $1.0
million per share. An aggregate total of 47 Class B Preferred Shares have been
sold privately to nonaffiliates. These securities qualify as Tier 2 capital and
are presented in the Consolidated Statements of Condition as 'Term borrowings'.
FTRESC is a real estate investment trust (REIT) established for the purpose of
acquiring, holding and managing real estate mortgage assets. Dividends on the
Class B Preferred Shares are cumulative and are payable semi-annually.

The Class B Preferred Shares are mandatorily redeemable on March 31, 2031, and
redeemable at the discretion of FTRESC in the event that the Class B Preferred
Shares cannot be accounted for as Tier 2 regulatory capital or there is more
than an insubstantial risk that dividends paid with respect to the Class B
Preferred Shares will not be fully deductible for tax purposes. They are not
subject to any sinking fund and are not convertible into any other securities of
FTRESC, FHN or any of its subsidiaries. The shares are, however, automatically
exchanged at the direction of the Office of the Comptroller of the Currency for
preferred stock of FTBNA, having substantially the same terms as the Class B
Preferred Shares in the event FTBNA becomes undercapitalized, insolvent or in
danger of becoming undercapitalized.

First Horizon National Corporation     83





<Page>


NOTE 12 - PREFERRED STOCK OF SUBSIDIARY (CONTINUED)

On July 1, 2003, FHN adopted certain provisions of SFAS No. 150, which require
certain financial instruments with both liability and equity characteristics to
be classified as liabilities on the statement of condition. Upon adoption of
this statement, FHN classified its mandatorily redeemable preferred stock of
subsidiary in 'Term borrowings' (See Note 10  -  Term Borrowings). Historically,
the related distributions on these instruments ($4.6 million annually) were
classified as noninterest expense on the Consolidated Statements of Income, but
as of July 1, 2003, are classified as interest expense on a prospective basis.
Restatement of prior periods was not permitted.

The following indirect, wholly-owned subsidiaries of FHN have also issued
preferred stock. First Horizon Mortgage Loan Corporation has issued $1.0 million
of Class B Preferred Shares. Additionally, FHRIII, LLC and FHRIV, LLC have each
issued $1.0 million of Class B Preferred Units. On December 31, 2004 and 2003,
$.5 million of preferred stock that is perpetual in nature and not subject to
the provisions of SFAS No. 150 was recognized as 'Preferred stock of subsidiary'
on the Consolidated Statements of Condition. The remaining balance has been
eliminated in consolidation.

NOTE 13 - REGULATORY CAPITAL

FHN is subject to various regulatory capital requirements administered by the
federal banking agencies. Failure to meet minimum capital requirements can
initiate certain mandatory, and possibly additional discretionary actions by
regulators that, if undertaken, could have a direct material effect on FHN's
financial statements. Under capital adequacy guidelines and the regulatory
framework for prompt corrective action, specific capital guidelines that involve
quantitative measures of assets, liabilities and certain derivatives as
calculated under regulatory accounting practices must be met. Capital amounts
and classification are also subject to qualitative judgment by the regulators
about components, risk weightings and other factors. Quantitative measures
established by regulation to ensure capital adequacy require FHN to maintain
minimum amounts and ratios of total and Tier 1 capital to risk-weighted assets,
and of Tier 1 capital to average assets (leverage). Management believes, as of
December 31, 2004, that FHN met all capital adequacy requirements to which it
was subject.

The actual capital amounts and ratios of FHN and FTBNA (the banking subsidiary
of FHN) are presented in the table below. In addition, FTBNA must also calculate
its capital ratios after excluding financial subsidiaries as defined by the
Gramm-Leach-Bliley Act of 1999. Based on this calculation FTBNA's Total Capital,
Tier 1 Capital and Leverage ratios were 12.37 percent, 8.41 percent and 7.04
percent, respectively, on December 31, 2004, and were 12.12 percent, 8.94
percent and 7.16 percent, respectively, on December 31, 2003.

                                      84     First Horizon National Corporation





<Page>


NOTE 13 - REGULATORY CAPITAL (CONTINUED)

<Table>
<Caption>
                                                                                       First Tennessee Bank
                                                         First Horizon National              National
                                                              Corporation                  Association
                                                         ----------------------       ----------------------
(Dollars in thousands)                                     Amount         Ratio         Amount         Ratio
- ------------------------------------------------------------------------------------------------------------
<S>                                                      <C>              <C>         <C>              <C>
ON DECEMBER 31, 2004:
Actual:
Total Capital                                            $3,182,733       13.18%      $3,064,060       12.79%
Tier 1 Capital                                            2,080,237        8.62        2,061,564        8.61
Leverage                                                  2,080,237        7.16        2,061,564        7.15
For Capital Adequacy Purposes:
Total Capital                                             1,931,256 >=     8.00        1,916,456 >=     8.00
Tier 1 Capital                                              965,628 >=     4.00          958,228 >=     4.00
Leverage                                                  1,162,155 >=     4.00        1,152,831 >=     4.00
To Be Well Capitalized Under Prompt Corrective Action
 Provisions:
Total Capital                                                                          2,395,570 >=    10.00
Tier 1 Capital                                                                         1,437,342 >=     6.00
Leverage                                                                               1,441,039 >=     5.00
- ------------------------------------------------------------------------------------------------------------
On December 31, 2003:
Actual:
Total Capital                                            $2,509,835       13.19%      $2,384,981       12.63%
Tier 1 Capital                                            1,754,367        9.22        1,734,092        9.18
Leverage                                                  1,754,367        7.19        1,734,092        7.25
For Capital Adequacy Purposes:
Total Capital                                             1,522,301 >=     8.00        1,510,952 >=     8.00
Tier 1 Capital                                              761,151 >=     4.00          755,476 >=     4.00
Leverage                                                    975,794 >=     4.00          956,384 >=     4.00
To Be Well Capitalized Under Prompt Corrective Action
 Provisions:
Total Capital                                                                          1,888,690 >=    10.00
Tier 1 Capital                                                                         1,133,214 >=     6.00
Leverage                                                                               1,195,480 >=     5.00
- ------------------------------------------------------------------------------------------------------------
</Table>

First Horizon National Corporation     85





<Page>


NOTE 14 - OTHER INCOME AND OTHER EXPENSE

Following is detail concerning 'All other income' and 'All other expense' as
presented in the Consolidated Statements of Income:

<Table>
<Caption>
(Dollars in thousands)                                          2004           2003           2002
- ----------------------------------------------------------------------------------------------------
<S>                                                           <C>            <C>            <C>
ALL OTHER INCOME:
Cardholder fees                                               $ 25,075       $ 22,698       $ 20,145
Asset securitizations                                           23,090              -              -
Other service charges                                           19,709         19,810         21,204
Remittance processing                                           19,515         23,666         26,016
Check clearing fees                                             10,052         11,839         13,180
Other                                                           89,698         68,286         60,765
- ----------------------------------------------------------------------------------------------------
Total                                                         $187,139       $146,299       $141,310
====================================================================================================
ALL OTHER EXPENSE:
Advertising and public relations                              $ 39,961       $ 43,955       $ 35,982
Legal and professional fees                                     37,730         60,001         37,340
Travel and entertainment                                        30,794         37,432         22,501
Computer software                                               28,906         28,828         26,140
Contract employment                                             23,714         33,790         28,987
Supplies                                                        17,591         18,783         15,145
Fed service fees                                                 8,838          9,195          9,597
Foreclosed real estate                                           5,834         13,137         21,479
Deposit insurance premium                                        3,024          2,703          2,393
Charitable contributions                                         1,497         13,370         48,337
Distributions on guaranteed preferred securities                     -          8,070          8,070
Distributions on preferred stock of subsidiary                       -          2,282          4,564
Other                                                          102,753        121,498         69,171
- ----------------------------------------------------------------------------------------------------
Total                                                         $300,642       $393,044       $329,706
====================================================================================================
</Table>

Certain previously reported amounts have been reclassified to agree with current
presentation.

NOTE 15 - COMPONENTS OF OTHER COMPREHENSIVE (LOSS)/INCOME

Following is detail of 'Accumulated other comprehensive (loss)/income' as
presented in the Consolidated Statements of Condition:

<Table>
<Caption>
                                                                              Tax       Accumulated Other
                                                              Before-Tax   (Expense)/     Comprehensive
(Dollars in thousands)                                          Amount      Benefit       (Loss)/Income
- ---------------------------------------------------------------------------------------------------------
<S>                                                           <C>          <C>          <C>
December 31, 2001                                                                           $ 23,278
Other comprehensive income:
 Unrealized market adjustments on cash flow hedge              $   (224)    $    87             (137)
 Minimum pension liability                                       (2,196)        807           (1,389)
 Unrealized market adjustments on securities available for
   sale                                                          (1,613)        739             (874)
 Adjustment for net losses included in net income                 9,180      (3,571)           5,609
- -------------------------------------------------------------------------------------   -----------------
December 31, 2002                                              $  5,147     $(1,938)          26,487
=====================================================================================
Other comprehensive income:
 Unrealized market adjustments on cash flow hedge              $    224     $   (87)             137
 Minimum pension liability                                       (1,786)        657           (1,129)
 Unrealized market adjustments on securities available for
   sale                                                         (37,988)     14,637          (23,351)
 Adjustment for net gains included in net income                 (2,378)        916           (1,462)
- -------------------------------------------------------------------------------------   -----------------
December 31, 2003                                              $(41,928)    $16,123              682
=====================================================================================
Other comprehensive income:
 Minimum pension liability                                     $   (505)    $   186             (319)
 Unrealized market adjustments on securities available for
   sale                                                           3,961      (1,533)           2,428
 Adjustment for net gains included in net income                (20,748)      8,029          (12,719)
- -------------------------------------------------------------------------------------   -----------------
DECEMBER 31, 2004                                              $(17,292)    $ 6,682         $ (9,928)
=====================================================================================   =================
</Table>

                                       86     First Horizon National Corporation





<Page>


NOTE 16 - INCOME TAXES

The components of income tax expense/(benefit) are as follows:

<Table>
<Caption>
(Dollars in thousands)                                          2004       2003       2002
- --------------------------------------------------------------------------------------------
<S>                                                           <C>        <C>        <C>
Current:
 Federal                                                      $169,158   $134,793   $119,258
 State                                                           1,771     (2,820)    20,102
Deferred:
 Federal                                                        29,855     80,779     44,191
 State                                                          11,617     32,937     (1,943)
- --------------------------------------------------------------------------------------------
Total                                                         $212,401   $245,689   $181,608
============================================================================================
</Table>

The effective tax rates for 2004, 2003 and 2002 were 31.85 percent, 34.17
percent and 32.54 percent, respectively. Income tax expense was different than
the amounts computed by applying the statutory federal income tax rate to income
before income taxes because of the following:

<Table>
<Caption>
(Dollars in thousands)                                          2004       2003       2002
- --------------------------------------------------------------------------------------------
<S>                                                           <C>        <C>        <C>
Federal income tax rate                                         35%        35%        35%
- --------------------------------------------------------------------------------------------
Tax computed at statutory rate                                $233,383   $251,649   $195,321
Increase/(decrease) resulting from:
 State income taxes                                              8,702     19,582     11,936
 Tax credits                                                   (17,201)   (14,703)    (9,219)
 Other                                                         (12,483)   (10,839)   (16,430)
- --------------------------------------------------------------------------------------------
Total                                                         $212,401   $245,689   $181,608
============================================================================================
</Table>

A deferred tax asset or liability is recognized for the tax consequences of
temporary differences between the financial statement carrying amounts and the
tax bases of existing assets and liabilities. The tax consequence is calculated
by applying enacted statutory tax rates, applicable to future years, to these
temporary differences. Temporary differences which gave rise to deferred tax
(assets)/liabilities on December 31, 2004 and 2003, were as follows:

<Table>
<Caption>
(Dollars in thousands)                                          2004        2003
- -----------------------------------------------------------------------------------
<S>                                                           <C>         <C>
DEFERRED TAX ASSETS:
Loss reserves                                                 $ (67,307)  $ (68,952)
Employee benefits                                               (47,556)    (42,929)
Accrued expenses                                                 (8,326)    (13,404)
Other                                                           (19,109)    (19,775)
- -----------------------------------------------------------------------------------
 Gross deferred tax assets                                     (142,298)   (145,060)
- -----------------------------------------------------------------------------------
DEFERRED TAX LIABILITIES:
Capitalized mortgage servicing rights                           348,258     355,167
Asset securitizations                                            24,943           -
Depreciation and amortization                                    33,803      23,460
Federal Home Loan Bank stock                                     12,265      10,867
Deferred fees and expenses                                       39,754      36,763
Other intangible assets                                          16,200      14,299
Other                                                            17,063      14,353
- -----------------------------------------------------------------------------------
 Gross deferred tax liabilities                                 492,286     454,909
- -----------------------------------------------------------------------------------
Net deferred tax liabilities                                  $ 349,988   $ 309,849
===================================================================================
</Table>

The deferred tax assets above are net of an insignificant valuation allowance
due to capital losses. Other than these capital losses, no valuation allowance
related to deferred tax assets has been recorded on December 31, 2004 and 2003,
as management believes it is more likely than not that the remaining deferred
tax assets will be fully realized.

First Horizon National Corporation     87





<Page>


NOTE 17 - EARNINGS PER SHARE

The following table shows a reconciliation of earnings per common share to
diluted earnings per common share.

<Table>
<Caption>
(Dollars in thousands, except per share data)                   2004           2003           2002
- ------------------------------------------------------------------------------------------------------
<S>                                                         <C>            <C>            <C>
Net income                                                     $ 454,408      $ 473,309      $ 376,451

EARNINGS PER COMMON SHARE:

Weighted average common shares outstanding                   123,641,035    125,686,999    125,682,766
Shares attributable to deferred compensation                   1,089,536      1,078,424      1,031,647
- ------------------------------------------------------------------------------------------------------
Total weighted average shares                                124,730,571    126,765,423    126,714,413

Earnings per common share                                      $    3.64      $    3.73      $    2.97
======================================================================================================

DILUTED EARNINGS PER COMMON SHARE:

Weighted average shares outstanding                          124,730,571    126,765,423    126,714,413
Dilutive effect due to stock options                           3,705,771      4,110,618      3,506,756
- ------------------------------------------------------------------------------------------------------
Total weighted average shares, as adjusted                   128,436,342    130,876,041    130,221,169

Diluted earnings per common share                              $    3.54      $    3.62      $    2.89
======================================================================================================
</Table>

Outstanding stock options of 2,807,746, 1,257,236 and 2,265,352 with weighted
average exercise prices of $45.70, $40.73 and $38.09 per share for the years
ended December 31, 2004, 2003 and 2002, respectively, were not included in the
computation of diluted earnings per share because such shares would have had an
antidilutive effect on earnings per share.

                                       88     First Horizon National Corporation





<Page>


NOTE 18 - RESTRICTIONS, CONTINGENCIES, COMMITMENTS AND OTHER DISCLOSURES

RESTRICTIONS ON CASH AND DUE FROM BANKS. The commercial banking subsidiaries of
FHN are required to maintain average reserve and clearing balances with the
Federal Reserve Bank under the Federal Reserve Act and Regulation D. The
balances required on December 31, 2004 and 2003, were $225.2 million and $221.0
million, respectively. These reserves are included in 'Cash and due from banks'
on the Consolidated Statements of Condition.

RESTRICTIONS ON DIVIDENDS. Dividends are paid by FHN from its assets, which are
mainly provided by dividends from its subsidiaries. Certain regulatory
restrictions exist regarding the ability of FTBNA to transfer funds to FHN in
the form of cash, dividends, loans or advances. As of December 31, 2004, FTBNA
had undivided profits of $1,930.7 million of which $807.6 million was available
for distribution to FHN as dividends without prior regulatory approval.

RESTRICTIONS ON INTERCOMPANY TRANSACTIONS. Under Federal banking law, banking
subsidiaries may not extend credit to the parent company in excess of 10 percent
of the bank's capital stock and surplus, as defined, or $303.2 million on
December 31, 2004. The parent company had covered transactions of $49.3 million
from FTBNA on December 31, 2004. In addition the aggregate amount of covered
transactions with all affiliates, as defined, is limited to 20 percent of the
bank's capital stock and surplus, or $606.3 million on December 31, 2004.
FTBNA's total covered transactions with all affiliates on December 31, 2004 were
$191.3 million. Certain loan agreements also define other restricted
transactions related to additional borrowings.

CONTINGENCIES. Contingent liabilities arise in the ordinary course of business,
including those related to litigation. Various claims and lawsuits are pending
against FHN and its subsidiaries. Although FHN cannot predict the outcome of
these lawsuits, after consulting with counsel, management has been able to form
an opinion on the effect all of these lawsuits, except the matter mentioned in
the paragraph below, will have on the consolidated financial statements. It is
management's opinion that when resolved, these lawsuits will not have a material
adverse effect on the consolidated financial statements of FHN.

In November 2000, a complaint was filed in Missouri state court against FHN's
subsidiary, First Horizon Home Loans. The case concerns the charging of certain
loan origination fees, permitted by Kansas law but allegedly restricted or not
permitted by Missouri law, when First Horizon Home Loans or its predecessor,
McGuire Mortgage Company, made certain second mortgage loans in Kansas which
were secured by Missouri property. Among other relief, plaintiffs seek fees,
loan interest, punitive damages, statutory penalties, and loan rescission. In
response to pre-trial motions, the court has ruled that Missouri law governs the
loan transactions and has certified a statewide class action; plaintiffs contend
the class involves approximately 4,600 loans, but the exact size is in dispute.
Discovery is ongoing and additional pre-trial motions are pending. Trial is
currently scheduled for June 2005. FHN believes that it has meritorious defenses
and intends to continue to protect its rights and defend this lawsuit
vigorously, through trial and appeal, if necessary.

LOAN COMMITMENTS. FHN enters into fixed and variable loan commitments with
customers. When these commitments have contract rate adjustments that lag
changes in market rates, the financial instruments have characteristics similar
to option contracts. FHN follows the same credit policies and underwriting
practices in making commitments as it does for on-balance sheet instruments.
Each counterparty's creditworthiness is evaluated on a case-by-case basis. The
amount of collateral obtained, if any, is based on management's credit
evaluation of the counterparty.

Commitments to extend credit are contractual obligations to lend to a customer
as long as all established contractual conditions are met. These commitments
generally have fixed expiration dates or other termination clauses and may
require payment of a fee. The majority of FHN's loan commitments have maturities
less than one year and reflect the prevailing market rates at the time of the
commitment. Since commitments may expire without being fully drawn upon, the
total contract amount does not necessarily represent future cash requirements.

First Horizon National Corporation     89





<Page>


NOTE 18 - RESTRICTIONS, CONTINGENCIES, COMMITMENTS AND OTHER DISCLOSURES
(CONTINUED)

Other commitments include standby and commercial letters of credit and other
credit enhancements. Standby and commercial letters of credit and other credit
enhancements are conditional commitments issued by FHN to guarantee the
performance and/or payment of a customer to a third party in connection with
specified transactions. The credit risk involved in issuing these commitments is
essentially the same as that involved in extending loan facilities to customers,
as performance under any of these facilities would result in a loan being funded
to the customer.

The following is a summary of the maximum credit exposure of each class of
lending related off-balance sheet financial instruments outstanding on
December 31:

<Table>
<Caption>
(Dollars in millions)                                            2004        2003
- -----------------------------------------------------------------------------------
<S>                                                            <C>         <C>
Commitments to extend credit:
 Consumer credit card lines                                    $ 2,002.3   $ 1,668.9
 Consumer home equity                                            5,868.7     4,119.9
 Commercial real estate and construction and land
   development                                                   2,489.0     1,453.4
 Commercial and other                                            3,262.3     2,839.2
- ------------------------------------------------------------------------------------
Total loan commitments                                          13,622.3    10,081.4
Other commitments:
 Standby letters of credit                                         618.8       522.4
 Other                                                              84.4        48.1
- ------------------------------------------------------------------------------------
Total loan and other commitments                               $14,325.5   $10,651.9
====================================================================================
</Table>

OTHER DISCLOSURES  -  COMPANY OWNED LIFE INSURANCE. FHN has purchased life
insurance on certain of its employees and is the beneficiary on these policies.
On December 31, 2004, the cash surrender value of these policies, which is
included in 'Capital markets receivables and other assets' on the Consolidated
Statements of Condition, was $378.7 million. There are no restrictions on the
proceeds from these benefits, and FHN has not borrowed against the cash
surrender value of these policies.

OTHER DISCLOSURES  -  INDEMNIFICATION AGREEMENTS AND GUARANTEES. In the ordinary
course of business, FHN enters into indemnification agreements for legal
proceedings against its directors and officers and standard representation
warranties for underwriting agreements, merger and acquisition agreements, sold
loans and other similar types of arrangements. It is not possible to estimate a
maximum potential amount of payouts that could be required with such agreements.

First Horizon Home Loans services a first-lien mortgage loan portfolio of
approximately $86.6 billion as of December 31, 2004, a significant portion of
which is held by Government Sponsored Enterprises (GSE) or private security
holders. In connection with its servicing activities, First Horizon Home Loans
guarantees the receipt of the scheduled principal and interest payments on the
underlying loans. In the event of customer non-performance on the loan, First
Horizon Home Loans is obligated to make the payment to the security holder.
Under the terms of the servicing agreements, First Horizon Home Loans can
utilize payments received from other prepaid loans in order to make the security
holder whole. In the event payments are ultimately made by First Horizon Home
Loans to satisfy this obligation, for loans sold with no recourse, all funds are
recoverable from the GSE at foreclosure sale. See Note 24  -  Securitizations
for additional information on loans sold with recourse.

First Horizon Home Loans is also subject to losses in its loan servicing
portfolio due to loan foreclosures and other recourse obligations. Certain
agencies have the authority to limit their repayment guarantees on foreclosed
loans resulting in certain foreclosure costs being borne by servicers. In
addition, First Horizon Home Loans has exposure on all loans sold with recourse.
First Horizon Home Loans has various claims for reimbursement, repurchase
obligations, and/or indemnification requests outstanding with government
agencies or private investors. First Horizon Home Loans has evaluated all of its
exposure under recourse obligations based on factors, which include loan
delinquency status, foreclosure expectancy rates and claims outstanding.
Accordingly, First

                                       90     First Horizon National Corporation





<Page>


NOTE 18 - RESTRICTIONS, CONTINGENCIES, COMMITMENTS AND OTHER DISCLOSURES
(CONTINUED)

Horizon Home Loans had an allowance for losses on the mortgage servicing
portfolio of approximately $18.5 million and $22.3 million as of December 31,
2004 and 2003, respectively. First Horizon Home Loans has sold certain mortgage
loans with an agreement to repurchase the loans upon default. As of
December 31, 2004 and 2003, First Horizon Home Loans had single-family
residential loans with outstanding balances of $150.8 million and $199.3
million, respectively that were sold on a recourse basis. For the single-family
residential loans, in the event of borrower nonperformance, First Horizon Home
Loans would assume losses to the extent they exceed the value of the collateral
and private mortgage insurance, FHA insurance or VA guarantees. As of
December 31, 2004 and 2003, the outstanding principal balance of loans sold with
limited recourse and serviced by First Horizon Home Loans was $3.4 billion and
$3.7 billion, respectively.

In 2004, FTBNA securitized and sold home equity lines of credit and second-lien
mortgages which are held by private security holders, and on December 31, 2004,
the outstanding principal balance of loans was $1.3 billion and $.2 billion,
respectively. In connection with its servicing activities, FTBNA does not
guarantee the receipt of the scheduled principal and interest payments on the
underlying loans but does have a residual interest of $55.0 million on December
31, 2004, which is available to make the security holder whole in the event of
credit losses. FTBNA has projected expected credit losses in the valuation of
the residual interest.

NOTE 19 - SHAREHOLDER PROTECTION RIGHTS AGREEMENT

On October 20, 1998, FHN adopted a Shareholder Protection Rights Agreement (the
'Agreement') and declared a dividend of one right on each outstanding share of
common stock held on November 2, 1998, or issued thereafter and prior to the
time the rights separate and thereafter pursuant to options and convertible
securities outstanding at the time the rights separate.

The Agreement provides that until the earlier of the tenth business day (subject
to certain adjustments by the board of directors) after a person or group
commences a tender or exchange offer that will, subject to certain exceptions,
result in such person or group owning 10 percent or more of FHN's common stock,
or the tenth business day (subject to certain adjustments by the board) after
the public announcement by FHN that a person or group owns 10 percent or more of
FHN's common stock, the rights will be evidenced by the common stock
certificates, will automatically trade with the common stock, and will not be
exercisable. Thereafter, separate rights certificates will be distributed, and
each right will entitle its holder to purchase one one-hundredth of a share of
participating preferred stock having economic and voting terms similar to those
of one share of common stock for an exercise price of $150.

If any person or group acquires 10 percent or more of FHN's common stock, then
each right (other than rights beneficially owned by holders of 10 percent or
more of the common stock or affiliates, associates or transferees thereof, which
rights become void) will entitle its holder to purchase, for the exercise price,
a number of shares of FHN common stock or participating preferred stock having a
market value of twice the exercise price. Also, if there is a 10 percent
shareholder and FHN is involved in certain significant transactions, each right
will entitle its holder to purchase, for the exercise price, a number of shares
of common stock of the other party having a market value of twice the exercise
price. If any person or group acquires 10 percent or more (but not more than 50
percent) of FHN's common stock, FHN's board of directors may, at its option,
exchange one share of FHN common stock or one one-hundredth of a share of
participating preferred stock for each right (other than rights which have
become void). The board of directors may amend the Agreement in any respect
prior to the tenth business day after announcement by FHN that a person or group
has acquired 10 percent or more of FHN's common stock. The rights will expire on
the earliest of the following times: the time of the exchange described in the
second preceding sentence; December 31, 2009; or the date the rights are
redeemed as described in the following sentence. The rights may be redeemed by
the board of directors for $0.001 per right until 10 business days after FHN
announces that any person or group owns 10 percent or more of FHN's common
stock.

First Horizon National Corporation     91





<Page>


NOTE 20 - SAVINGS, PENSION AND OTHER EMPLOYEE BENEFITS

SAVINGS PLAN. Substantially all employees of FHN are covered by a contributory
savings plan in conjunction with a flexible benefits plan. During the year, FHN
makes contributions to each employee's flexible benefits plan account. These
contributions are based on length of service and a percentage of the employee's
salary. The employees have the option to direct a portion or all of the
contribution into their savings plan accounts. Employees may also make pre-tax
and after-tax personal contributions to the savings plan. FHN matches the
majority of employee pre-tax contributions invested in FHN's common stock fund
(or for employees of First Horizon Home Loans, contributions made to any savings
plan fund) at a rate of $.50 for each $1.00 invested up to 6 percent of the
employee's qualifying salary. Contributions made by FHN to the flexible benefits
plan were $26.8 million for 2004, $24.4 million for 2003 and $20.4 million for
2002. A feature of the savings plan allows employees to choose to invest their
savings in one or more of ten various component funds, including a nonleveraged
employee stock ownership plan (ESOP). Compensation cost related to the ESOP is
measured as the amount allocated from matching contributions and discretionary
contributions contributed to the ESOP and is included in the contributions
amount above. Dividends on shares held by the ESOP are charged to retained
earnings and shares held by the ESOP are treated as outstanding in computing
earnings per share. The number of allocated shares held by the ESOP totaled
8,200,173 on December 31, 2004.

PENSION PLAN. FHN provides pension benefits to employees retiring under the
provisions of a noncontributory, defined benefit pension plan. Pension benefits
are based on years of service, average compensation near retirement and
estimated social security benefits at age 65. The annual funding is based on an
actuarially determined amount using the entry age cost method. FHN also
maintains a nonqualified supplemental executive retirement plan. All benefits
provided under this plan are unfunded and payments to plan participants are made
by FHN.

OTHER EMPLOYEE BENEFITS. FHN provides postretirement medical insurance to
full-time employees retiring under the provisions of the FTNC Pension Plan. The
postretirement medical plan is contributory with retiree contributions adjusted
annually. The plan is based on criteria that are a combination of the employee's
age and years of service and utilizes a two-step approach. For any employee
retiring on or after January 1, 1995, FHN will contribute a fixed amount based
on years of service and age at time of retirement. FHN's postretirement benefits
include prescription drug benefits. The Medicare Prescription Drug, Improvement
and Modernization Act of 2003 (the Act) introduces a prescription drug benefit
under Medicare Part D as well as a federal subsidy to sponsors of retiree health
care benefit plans that provide a benefit that is at least actuarially
equivalent to Medicare Part D. In May 2004, the FASB approved issuance of FSP
FAS 106-2, 'Accounting and Disclosure Requirements Related to the Medicare
Prescription Drug, Improvement and Modernization Act of 2003'. FSP FAS 106-2
requires a plan sponsor to determine if benefits offered through a
postretirement health care plan are actuarially equivalent to Medicare Part D.
If benefits are determined to be actuarially equivalent, the resulting effect on
the plan's obligations should be reflected as an actuarial gain in determining
the plan's accumulated postretirement benefit obligation. FHN adopted the
provisions of FSP FAS 106-2 effective July 1, 2004. The impact of adopting FSP
FAS 106-2 was immaterial to FHN.

                                       92     First Horizon National Corporation





<Page>


NOTE 20 - SAVINGS, PENSION AND OTHER EMPLOYEE BENEFITS (CONTINUED)

ACTUARIAL ASSUMPTIONS. The actuarial assumptions used in the defined benefit
pension plan and the other employee benefit plan were as follows:

<Table>
<Caption>
                                                               Pension Benefits     Postretirement Benefits
                                                              ------------------    -----------------------
                                                              2004   2003   2002     2004    2003     2002
                                                              -------------------   -----------------------
<S>                                                           <C>    <C>    <C>     <C>      <C>     <C>
- -----------------------------------------------------------------------------------------------------------
WEIGHTED-AVERAGE ASSUMPTIONS USED TO DETERMINE BENEFIT
 OBLIGATIONS AS OF SEPTEMBER 30 MEASUREMENT DATE
Discount rate                                                 6.47%  6.25%   6.75%   6.07%   6.25%    6.75%
Rate of compensation increase                                 4.00   4.00    4.00     N/A     N/A      N/A
- -----------------------------------------------------------------------------------------------------------
WEIGHTED-AVERAGE ASSUMPTIONS USED TO DETERMINE NET PERIODIC
 BENEFIT COST FOR THE FISCAL YEAR
Discount rate                                                 6.25%  6.75%   7.25%   6.25%   6.75%    7.25%
Expected return on plan assets                                8.75   8.75   10.00    8.75    8.75    10.00
Expected return on plan assets dedicated to employees who
 retired prior to January 1, 1993                             N/A    N/A      N/A    5.75    5.75     6.50
Rate of compensation increase                                 4.00   4.00    4.00     N/A     N/A      N/A
- -----------------------------------------------------------------------------------------------------------
</Table>

To develop the expected long-term rate of return on assets assumption, FHN
considered the current level of expected returns on risk free investments
(primarily government bonds), the historical level of the risk premium
associated with the other asset classes in which the portfolio is invested and
the expectations for future returns of each asset class. Since FHN's investment
policy is to actively manage certain asset classes where the potential exists to
outperform the broader market, the expected returns for those asset classes were
adjusted to reflect the expected additional returns. The expected return for
each asset class was then weighted based on the target asset allocation to
develop the expected long-term rate of return on assets assumption for the
portfolio. This resulted in the selection of an 8.70 percent assumption for 2005
and 8.75 percent for 2004.

The discount rates for 2004 of 6.47 percent for pension and 6.07 percent for
postretirement benefits were determined by using a hypothetical AA yield curve
represented by a series of annualized individual discount rates from one-half to
thirty years. The discount rate is selected based on data specific to FHN's
plans and employee population. For prior years, the discount rate was determined
by monitoring Moody's AA corporate rates as of the measurement date to establish
an annual discount rate. These rates were not based on FHN's specific
participant data but were intended to be reflective of the interest rate at
which pension liabilities could be settled. The rates as reflected by Moody's AA
corporate rates were rounded to the nearest .25 percent.

The assumed health care cost trend rates used in the defined benefit pension
plan and the other employee benefit plan were as follows:

<Table>
<Caption>
                                                       2004                                 2003
- -------------------------------------------------------------------------------------------------------------
ASSUMED HEALTH CARE COST TREND            PARTICIPANTS   PARTICIPANTS 65       Participants   Participants 65
RATES ON SEPTEMBER 30                     UNDER AGE 65   YEARS AND OLDER       under age 65   years and older
                                          -------------------------------------------------------------------
<S>                                       <C>            <C>                   <C>            <C>
Health care cost trend rate assumed for
 next year                                     9.0%           11.0%                 9.5%           11.5%
Rate to which the cost trend rate is
 assumed to decline (the ultimate trend
 rate)                                         6.0             8.0                  6.0             8.0
Year that the rate reaches the ultimate
 trend rate                                   2010            2010                 2010            2010
- -------------------------------------------------------------------------------------------------------------
</Table>

First Horizon National Corporation     93





<Page>


NOTE 20 - SAVINGS, PENSION AND OTHER EMPLOYEE BENEFITS (CONTINUED)

The health care cost trend rate assumption has a significant effect on the
amounts reported. A one-percentage-point change in assumed health care cost
trend rates would have the following effects:

<Table>
<Caption>
(Dollars in thousands)                                        1% Increase            1% Decrease
- ------------------------------------------------------------------------------------------------
<S>                                                           <C>                    <C>
Adjusted total service and interest cost components             $ 2,745                $ 2,573
Adjusted postretirement benefit obligation at end of plan
 year                                                            30,982                 28,460
- ------------------------------------------------------------------------------------------------
</Table>

The components of net periodic benefit cost for the plan years 2004, 2003 and
2002 were as follows:

<Table>
<Caption>
                                                     Pension Benefits         Postretirement Benefits
                                                ---------------------------   ------------------------
(Dollars in thousands)                           2004      2003      2002      2004     2003     2002
- ------------------------------------------------------------------------------------------------------
COMPONENTS OF NET PERIODIC BENEFIT COST
<S>                                             <C>       <C>       <C>       <C>      <C>      <C>
Service cost                                    $14,359   $12,832   $10,418   $  723   $  732   $  949
Interest cost                                    19,335    17,950    16,210    1,932    1,750    1,941
Expected return on plan assets                  (30,940)  (26,645)  (29,387)  (1,626)  (1,376)  (1,726)
Amortization of prior service cost                  684       736       738     (176)    (176)    (176)
Recognized losses                                 3,711       637       184        -        -        -
Amortization of transition obligation/(asset)         -       (20)     (460)     989      989      989
- ------------------------------------------------------------------------------------------------------
Net periodic cost/(benefit)                     $ 7,149   $ 5,490   $(2,297)  $1,842   $1,919   $1,977
======================================================================================================
</Table>

                                       94     First Horizon National Corporation





<Page>


NOTE 20 - SAVINGS, PENSION AND OTHER EMPLOYEE BENEFITS (CONTINUED)

The following table sets forth the plans' funded status reconciled to the
amounts shown in the Consolidated Statements of Condition:

<Table>
<Caption>
                                                             Pension Benefits     Postretirement Benefits
                                                            -------------------   -----------------------
(Dollars in thousands)                                        2004       2003       2004       2003
- ---------------------------------------------------------------------------------------------------------
<S>                                                         <C>        <C>        <C>        <C>
CHANGE IN BENEFIT OBLIGATION
Benefit obligation at beginning of plan year                $312,357   $270,143   $ 31,869   $ 26,947
Service cost                                                  14,359     12,832        723        732
Interest cost                                                 19,335     17,950      1,932      1,750
Actuarial (gain)/loss                                         (1,174)    19,502     (3,257)     4,276
Benefits paid                                                (11,469)    (8,070)    (1,599)    (1,836)
- ---------------------------------------------------------------------------------------------------------
Benefit obligation at end of plan year                      $333,408   $312,357   $ 29,668   $ 31,869
=========================================================================================================
CHANGE IN PLAN ASSETS
Fair value of plan assets at beginning of plan year         $288,059   $246,442   $ 20,803   $ 17,371
Actual return on plan assets                                  14,434     49,490      1,741      4,273
Employer contribution                                         57,041        197        615        995
Benefits paid                                                (11,469)    (8,070)    (1,599)    (1,836)
- ---------------------------------------------------------------------------------------------------------
Fair value of plan assets at end of plan year               $348,065   $288,059   $ 21,560   $ 20,803
=========================================================================================================
NET FUNDED STATUS ON SEPTEMBER 30                           $ 14,657   $(24,298)  $ (8,108)  $(11,066)
Unrecognized net actuarial loss                              109,765     98,144       (925)     2,447
Unrecognized net transitional obligation                           -          -      7,906      8,895
Unrecognized prior service cost/(benefit)                      5,760      6,444     (1,596)    (1,772)
- ---------------------------------------------------------------------------------------------------------
Prepaid benefit cost on September 30                         130,182     80,290     (2,723)    (1,496)
Contributions paid from October 1 to December 31                 145     28,835          -          -
- ---------------------------------------------------------------------------------------------------------
Prepaid benefit cost on December 31                         $130,327   $109,125   $ (2,723)  $ (1,496)
=========================================================================================================
Amounts recognized in the Consolidated Statements of
 Condition consist of the following:
Prepaid benefit cost                                        $130,327   $109,125
Accrued benefit liability                                     (5,393)    (5,017)
Intangible asset                                                 906      1,035
Accumulated other comprehensive income                         4,487      3,982
- ---------------------------------------------------------------------------------------------------------
Net amount recognized                                       $130,327   $109,125
=========================================================================================================
</Table>

The accumulated benefit obligation for the pension plan was $284.7 million and
$266.1 million on September 30, 2004 and 2003, respectively. FHN expects to
contribute the maximum tax deductible contribution to the pension plan, which is
estimated to be approximately $15 million to $17 million, and expects to make no
contribution to the other employee benefit plan in 2005. On September 30, 2004,
the qualified pension plan had $136.9 million in prepaid benefit cost, while the
supplemental executive retirement plan had $(6.7) million in benefit cost. The
accrued benefit liability, intangible asset and accumulated other comprehensive
income is attributable to the unfunded supplemental executive retirement plan.

First Horizon National Corporation     95





<Page>


NOTE 20 - SAVINGS, PENSION AND OTHER EMPLOYEE BENEFITS (CONTINUED)

The following benefit payments, which reflect expected future service, as
appropriate, are expected to be paid:

<Table>
<Caption>
                                                              Pension Benefits   Postretirement Benefits
- ------------------------------------------------------------------------------------------------------------
<S>                                                           <C>                <C>
2005                                                              $ 10,396               $ 1,566
2006                                                                11,574                 1,703
2007                                                                12,947                 1,833
2008                                                                14,447                 1,957
2009                                                                16,061                 2,074
Years 2010  - 2014                                                 110,221                11,980
- ------------------------------------------------------------------------------------------------------------
</Table>

The following provides the amount included within other comprehensive income for
the period arising from a change in the minimum pension liability:

<Table>
<Caption>
                                                              Pension Benefits
                                                              ----------------
(Dollars in thousands)                                         2004     2003
- ------------------------------------------------------------------------------
<S>                                                           <C>      <C>
Increase in minimum pension liability included in other
 comprehensive income                                         $ 505    $1,786
- ------------------------------------------------------------------------------
</Table>

The following table sets forth FHN's pension plan asset allocation on
September 30, 2004 and 2003:

<Table>
<Caption>
                                                                            Percentage of
                                                                             Plan Assets
                                                                           on September 30
                                                                   -----------------------------------
                                                        Targeted
                                                           Range        2004             2003
- ------------------------------------------------------------------------------------------------------
<S>                                                  <C>    <C>    <C>     <C>      <C>     <C>
Equity securities                                      70%          68.1%            57.4%
 Large capital equity                                         35%            39.0%            45.7%
 Small capital equity                                         20             19.2             11.7
 International equity                                         15              9.9                -
Other                                                  30           31.9             42.6
 Fixed income                                                                31.3             41.7
 Money market                                                                  .6               .9
- ------------------------------------------------------------------------------------------------------
   Total                                                                    100.0%           100.0%
======================================================================================================
</Table>

The primary investment objective is to ensure, over the long-term life of the
pension plan, an adequate pool of sufficiently liquid assets to support the
benefit obligations to participants, retirees and beneficiaries. In meeting this
objective, the pension plan seeks to achieve a high level of investment return
consistent with a prudent level of portfolio risk. Investment objectives are
long-term in nature covering typical market cycles of three to five years. Any
shortfall of investment performance compared to investment objectives should be
explainable in terms of general economic and capital market conditions. In
addition, the investment objective will be implemented through traditional
long-term stock and bond strategies. It is not contemplated at this time that
any derivative instruments will be used to achieve investment objectives.

During 2004 FHN reviewed its pension portfolio investment strategy and decided
to increase its equity exposure to 70 percent of total plan assets in 2005. The
expected return on plan assets assumption for 2005 will be 8.70 percent.

                                       96     First Horizon National Corporation





<Page>


NOTE 20 - SAVINGS, PENSION AND OTHER EMPLOYEE BENEFITS (CONTINUED)

Risk Management Practices: The asset allocation policy and the associated risk
budget has been developed based on an evaluation of the organization's ability
and willingness to assume investment risk in light of the Retirement Investment
Committee's financial and benefits-related goals and objectives.

Frequency of Rebalancing: The Retirement Investment Committee will rebalance the
portfolio assets as necessary to maintain liquidity for benefit payments and/or
stay within the established target asset allocation ranges. At a minimum
rebalancing will take place on an annual basis.

The following table sets forth FHN's other benefit plan asset allocation on
September 30, 2004 and 2003:

<Table>
<Caption>
                                                                       Percentage of
                                                                        Plan Assets
                                                                      on September 30
                                                              -----------------------------------
                                                                   2004             2003
- -------------------------------------------------------------------------------------------------
<S>                                                           <C>     <C>      <C>     <C>
Equity securities                                              55.5%            54.0%
 Large capital equity                                                   44.3%            43.3%
 Small capital equity                                                   11.2             10.7
Other                                                          44.5             46.0
 Fixed income                                                           43.5             44.7
 Money market                                                            1.0              1.3
- -------------------------------------------------------------------------------------------------
   Total                                                               100.0%           100.0%
=================================================================================================
</Table>

The primary investment objective is to ensure, over the long-term life of the
retiree medical obligation, an adequate pool of sufficiently liquid assets to
partially support the obligations to retirees and beneficiaries. The allocation
utilizing a tactical blend of individual securities and registered funds across
the broad asset classes is designed to capture a reasonable balance of risk and
return based on historical averages and parameters of Trust policy. In meeting
this objective, the retiree medical plan seeks to achieve a high level of
investment return consistent with a prudent level of portfolio risk. Investment
objectives are long-term in nature (longer than 10 years). It is not
contemplated at this time that any derivative instruments will be used to
achieve investment objectives.

Tactical allocation within the broad strategic objective of 55/45 equity to
fixed blend is contemplated periodically with an attention to the likelihood of
improving the return potential coupled with a reduction of the risk level.

The following table sets forth the amounts and types of mutual funds managed by
FTBNA that are included in plan assets:

<Table>
<Caption>
                                                                                     Postretirement
                                                               Pension Benefits         Benefits
                                                              -------------------   ----------------
(Dollars in thousands)                                          2004       2003      2004      2003
- ----------------------------------------------------------------------------------------------------
<S>                                                           <C>        <C>        <C>       <C>
First Funds Capital Appreciation Portfolio Class I            $ 66,781   $ 33,795   $ 2,423   $2,220
First Funds Core Equity Portfolio Class I                      106,722    103,504     7,106    6,463
First Funds Bond Portfolio Class I                             108,624    119,615     7,049    6,833
- ----------------------------------------------------------------------------------------------------
</Table>

FHN provides benefits to former and inactive employees after employment but
before retirement. The obligation recognized was $2.0 million in 2004, $3.6
million in 2003 and $1.4 million in 2002.

First Horizon National Corporation     97





<Page>


NOTE 20 - SAVINGS, PENSION AND OTHER EMPLOYEE BENEFITS (CONTINUED)

Medical and group life insurance expenses incurred for active employees are
shown in the following table:

<Table>
<Caption>
(Dollars in thousands)                                          2004      2003      2002
- ------------------------------------------------------------------------------------------
<S>                                                           <C>        <C>       <C>
Medical plan expense based on claims incurred                 $ 27,312   $23,919   $26,157
Participants                                                     9,130     8,576     7,273
- ------------------------------------------------------------------------------------------
Group life insurance expense based on benefits incurred       $  2,992   $ 2,171   $ 1,649
Participants                                                    12,709    11,653    10,679
- ------------------------------------------------------------------------------------------
</Table>

                                       98     First Horizon National Corporation





<Page>


NOTE 21 - STOCK OPTION, RESTRICTED STOCK INCENTIVE, AND DIVIDEND REINVESTMENT
PLANS

STOCK OPTION PLANS. FHN issues non-qualified stock options under various plans
to employees, non-employee directors, and bank advisory board members. The plans
provide for the issuance of FHN common stock at a price equal to its fair market
value at the date of grant; however, the exercise price may be less than the
fair market value if the grantee has agreed to receive the options in lieu of
compensation. The foregone compensation plus the exercise price equals the fair
market value of the stock on the date of grant. All options vest within 3 to 5
years and expire 7 years or 10 years from the date of grant, except for those
options that were previously part of compensation deferral, which vest
immediately or after 6 months and expire 20 years from the date of grant. After
January 2, 2004, stock options granted that are part of the compensation
deferral vest immediately or after 6 months and expire 10 years from the date of
grant. There were 3,336,677 shares available for option plan grants on
December 31, 2004.

As a result of plan amendments adopted by the board of directors during 1997,
employees may defer the receipt of shares upon the exercise of stock options.
The summary of stock option activity is shown below:

<Table>
<Caption>
                                                                                   Weighted
                                                                Options            Average
                                                              Outstanding       Exercise Price
- ----------------------------------------------------------------------------------------------
<S>                                                           <C>               <C>
January 1, 2002                                               21,111,090            $25.00
Options granted                                                4,908,512             33.12
Options exercised*                                            (3,218,704)            20.55
Options canceled                                                (502,155)            32.36
                                                              ----------
December 31, 2002                                             22,298,743             27.26
                                                              ==========
Options exercisable                                           15,916,332             24.96
- ----------------------------------------------------------------------------------------------
January 1, 2003                                               22,298,743            $27.26
Options granted                                                3,931,673             36.80
Options exercised*                                            (4,688,153)            24.49
Options canceled                                                (419,602)            34.56
                                                              ----------
December 31, 2003                                             21,122,661             29.51
                                                              ==========
Options exercisable                                           15,290,028             27.08
- ----------------------------------------------------------------------------------------------
January 1, 2004                                               21,122,661            $29.51
Options granted                                                2,961,967             42.67
Options exercised*                                            (2,829,981)            25.24
Options canceled                                                (822,413)            37.85
                                                              ----------
DECEMBER 31, 2004                                             20,432,234             31.68
                                                              ==========
Options exercisable                                           13,690,108             27.82
- ----------------------------------------------------------------------------------------------
</Table>

* Stock options exercised for 2004, 2003 and 2002 respectively, included 83,998,
  178,747 and 332,305 options converted to stock equivalents as part of the
  deferred compensation program.

The following table summarizes information about stock options outstanding on
December 31, 2004:

<Table>
<Caption>
                                                                           Weighted                    Weighted
                                                             Weighted       Average                     Average
                                                              Average      Exercise                    Exercise
                                                             Remaining      Price-                      Price-
                                                Options     Contractual     Options       Options       Options
Exercise Price Range                          Outstanding      Life       Outstanding   Exercisable   Exercisable
- -----------------------------------------------------------------------------------------------------------------
<S>                                           <C>           <C>           <C>           <C>           <C>
$ 4.00  -  $20.00                              3,270,352        9.24        $ 16.05      3,266,602      $16.04
$20.01  -  $30.00                              4,272,235       11.87          25.07      4,112,133       25.15
$30.01  -  $40.00                              8,834,866        6.88          34.98      4,581,528       33.17
$40.01  -  $50.00                              4,054,781        7.07          44.20      1,729,845       42.23
- -----------------------------------------------------------------------------------------------------------------
</Table>

First Horizon National Corporation     99





<Page>


NOTE 21 - STOCK OPTION, RESTRICTED STOCK INCENTIVE, AND DIVIDEND REINVESTMENT
PLANS (CONTINUED)

FHN accounts for these plans under APB Opinion No. 25 pursuant to which
recognized compensation costs are negligible. Total additional compensation cost
that would have been recognized in income under SFAS No. 123 for all stock-based
compensation awards was $13.9 million for 2004, $32.9 million for 2003 and $23.8
million for 2002. See Note 1 - Summary of Significant Accounting Policies for
pro forma information.

FHN used the Black-Scholes Option Pricing Model to estimate the fair value of
stock options granted in 2004, 2003 and 2002, with the following assumptions:

<Table>
<Caption>
                                                                 2004             2003             2002
- ----------------------------------------------------------------------------------------------------------
<S>                                                           <C>              <C>              <C>
Expected dividend yield                                            3.51%            3.00%            2.81%
Expected option lives of options issued at market             4.93 YEARS       5.42 years       4.44 years
Expected option lives of options issued below market*         4.54 YEARS       4.68 years       4.54 years
Expected volatility                                               26.57%           30.63%           30.30%
Risk-free interest rates                                           3.04%            4.24%            4.10%
- ----------------------------------------------------------------------------------------------------------
</Table>

* Options are issued with an exercise price less than the fair market value on
  the date of grant if the grantee has agreed to receive the options in lieu of
  compensation. The foregone compensation plus the exercise price equals the
  fair market value on the date of grant.

<Table>
<Caption>
                                                                                  Weighted
                                                                                Average Fair
                                                               Number         Value per Option
                                                               Issued          at Grant Date
- ----------------------------------------------------------------------------------------------
<S>                                                           <C>             <C>
2004:
Options issued at market on the date of grant                 2,608,368            $ 8.61
Options issued below market on the date of grant*               353,599             22.42
- ----------------------------------------------------------------------------------------------
2003:
Options issued at market on the date of grant                 3,258,924            $ 8.52
Options issued below market on the date of grant*               672,749             20.19
- ----------------------------------------------------------------------------------------------
2002:
Options issued at market on the date of grant                 3,703,159            $ 8.28
Options issued below market on the date of grant*             1,205,353             13.47
- ----------------------------------------------------------------------------------------------
</Table>

* Options are issued with an exercise price less than the fair market value on
  the date of grant if the grantee has agreed to receive the options in lieu of
  compensation. The foregone compensation plus the exercise price equals the
  fair market value on the date of grant.

RESTRICTED STOCK INCENTIVE PLANS. FHN has authorized the issuance of its common
stock for awards to executive employees who have a significant impact on the
profitability of FHN under restricted stock incentive plans. Additionally, one
of the plans allows stock awards to be granted to non-employee directors upon
approval by the board of directors. It has been the recent practice of the board
to grant 8,000 shares of restricted stock to each new non-employee director upon
election to the board, with restrictions lapsing at a rate of ten percent per
year. In 2004, FHN granted 22,844 restricted shares under the plans. In 2003,
200,444 restricted shares were granted and 175,559 shares were granted in 2002.
Compensation expense related to these plans was $1.8 million, $5.1 million and
$2.5 million for the years 2004, 2003 and 2002, respectively.

The board of directors approved amendments to the restricted stock plan during
1998 permitting deferral by participants of the receipt of restricted stock
prior to the lapse of restrictions.

DIVIDEND REINVESTMENT PLAN. The Dividend Reinvestment and Stock Purchase Plan
(the Plan), as amended in October 2002, authorizes the sale of FHN's common
stock from shares acquired on the open market to shareholders who choose to
invest all or a portion of their cash dividends and make optional cash payments
of $25 to $10,000 per quarter without paying commissions. Prior to the 2002
amendment, the Plan authorized the sale of FHN's common stock from authorized,
but unissued common stock or from shares acquired on the open market. In 2002,
shares for this plan were purchased on the open market. The price of shares
purchased on the open market is the average price paid.

                                      100     First Horizon National Corporation





<Page>


NOTE 22 - BUSINESS SEGMENT INFORMATION

FHN has adapted its segments to reflect the common activities and operations of
aggregated business segments across the various delivery channels. Prior periods
have been restated for comparability. The new segments are Retail/Commercial
Banking, Mortgage Banking, Capital Markets and Corporate. The Retail/Commercial
Banking segment offers financial products and services, including traditional
lending and deposit taking, to retail and commercial customers. Additionally,
Retail/Commercial Banking provides investments, insurance, financial planning,
trust services and asset management, credit card, cash management, merchant
services, check clearing, and correspondent services. Retail/Commercial Banking
now includes Equity Lending and second-lien mortgage and construction loans
originated by First Horizon Home Loans which were previously in the mortgage
segment and correspondent banking which was previously in Capital Markets. The
Mortgage Banking segment consists of core mortgage banking elements including
originations and servicing and the associated ancillary revenues related to
these businesses. The Capital Markets segment consists of traditional capital
markets trading activities, equity research and investment banking. The
Corporate segment consists of unallocated corporate expenses, expense on certain
subordinated debt issuances and certain preferred stock, bank owned life
insurance, unallocated interest income associated with excess capital, funds
management and venture capital.

Total revenue, expense and asset levels reflect those which are specifically
identifiable or which are allocated based on an internal allocation method.
Because the allocations are based on internally developed assignments and
allocations, they are to an extent subjective. This assignment and allocation
has been consistently applied for all periods presented. The following table
reflects the amounts of consolidated revenue, expense, tax, and assets for each
segment for the three years ended December 31:

<Table>
<Caption>
(Dollars in thousands)                                                        2004          2003          2002
- ------------------------------------------------------------------------------------------------------------------
<S>                  <C>                                                   <C>           <C>           <C>
CONSOLIDATED         Net interest income                                   $   856,311   $   805,784   $   755,614
                     Provision                                                  48,348        86,698        92,184
                     Noninterest income                                      1,363,186     1,667,584     1,311,935
                     Noninterest expense                                     1,504,340     1,667,672     1,417,306
                     ---------------------------------------------------------------------------------------------
                     Pre-tax income                                            666,809       718,998       558,059
                     Income taxes                                              212,401       245,689       181,608
                     ---------------------------------------------------------------------------------------------
                     Net income                                            $   454,408   $   473,309   $   376,451
                     =============================================================================================
                     Average assets                                        $27,305,833   $25,133,612   $20,704,008
                     ---------------------------------------------------------------------------------------------
                     Depreciation, amortization and MSR impairment         $   324,585   $   425,231   $   353,672
                     Expenditures for long-lived assets                         78,763       149,600        56,794
- ------------------------------------------------------------------------------------------------------------------
RETAIL/COMMERCIAL    Net interest income                                   $   699,181   $   596,831   $   551,292
BANKING              Provision                                                  48,401        85,130        89,530
                     Noninterest income                                        483,255       442,889       403,233
                     Noninterest expense                                       721,260       709,134       651,347
                     ---------------------------------------------------------------------------------------------
                     Pre-tax income                                            412,775       245,456       213,648
                     Income taxes                                              123,433        74,590        55,122
                     ---------------------------------------------------------------------------------------------
                     Net income                                            $   289,342   $   170,866   $   158,526
                     =============================================================================================
                     Average assets                                        $17,498,468   $14,129,036   $12,182,293
                     ---------------------------------------------------------------------------------------------
                     Depreciation, amortization and MSR impairment         $    93,527   $    82,206   $    59,367
                     Expenditures for long-lived assets                         45,660        59,290        19,069
- ------------------------------------------------------------------------------------------------------------------
</Table>

Certain previously reported amounts have been reclassified to agree with current
presentation.

First Horizon National Corporation    101





<Page>


NOTE 22 - BUSINESS SEGMENT INFORMATION (CONTINUED)

<Table>
<Caption>
(Dollars in thousands)                                                            2004         2003         2002
- -------------------------------------------------------------------------------------------------------------------
<S>                <C>                                                         <C>          <C>          <C>
MORTGAGE           Net interest income                                         $  153,368   $  190,604   $  133,652
BANKING            Provision                                                          (53)       1,568        2,654
                   Noninterest income                                             464,975      664,248      456,186
                   Noninterest expense                                            438,366      466,244      344,815
                   ------------------------------------------------------------------------------------------------
                   Pre-tax income                                                 180,030      387,040      242,369
                   Income taxes                                                    65,598      143,741       92,086
                   ------------------------------------------------------------------------------------------------
                   Net income                                                  $  114,432   $  243,299   $  150,283
                   ================================================================================================
                   Average assets                                              $5,295,501   $6,441,890   $4,859,846
                   ------------------------------------------------------------------------------------------------
                   Depreciation and amortization                               $  220,055   $  317,946   $  289,199
                   Expenditures for long-lived assets                              25,148       79,120       22,148
- -------------------------------------------------------------------------------------------------------------------
CAPITAL MARKETS    Net interest income                                         $      399   $    5,621   $    7,757
                   Noninterest income                                             383,690      545,787      452,487
                   Noninterest expense                                            300,918      396,802      326,863
                   ------------------------------------------------------------------------------------------------
                   Pre-tax income                                                  83,171      154,606      133,381
                   Income taxes                                                    30,897       57,795       50,594
                   ------------------------------------------------------------------------------------------------
                   Net income                                                  $   52,274   $   96,811   $   82,787
                   ================================================================================================
                   Average assets                                              $1,675,445   $1,990,594   $1,353,211
                   ------------------------------------------------------------------------------------------------
                   Depreciation and amortization                               $    8,120   $    4,444   $    2,860
                   Expenditures for long-lived assets                               3,922        7,562        5,573
- -------------------------------------------------------------------------------------------------------------------
CORPORATE          Net interest income                                         $    3,363   $   12,728   $   62,913
                   Noninterest income                                              31,266       14,660           29
                   Noninterest expense                                             43,796       95,492       94,281
                   ------------------------------------------------------------------------------------------------
                   Pre-tax income                                                  (9,167)     (68,104)     (31,339)
                   Income taxes                                                    (7,527)     (30,437)     (16,194)
                   ------------------------------------------------------------------------------------------------
                   Net income                                                  $   (1,640)  $  (37,667)  $  (15,145)
                   ================================================================================================
                   Average assets                                              $2,836,419   $2,572,092   $2,308,658
                   ------------------------------------------------------------------------------------------------
                   Depreciation and amortization                               $    2,883   $   20,635   $    2,246
                   Expenditures for long-lived assets                               4,033        3,628       10,004
- -------------------------------------------------------------------------------------------------------------------
</Table>

Certain previously reported amounts have been reclassified to agree with current
presentation.

                                      102     First Horizon National Corporation





<Page>


NOTE 23 - FAIR VALUE OF FINANCIAL INSTRUMENTS

Accounting standards require the disclosure of estimated fair values of all
asset, liability and off-balance sheet financial instruments. The following fair
value estimates are determined as of a specific point in time utilizing various
assumptions and estimates. The use of assumptions and various valuation
techniques, as well as the absence of secondary markets for certain financial
instruments, will likely reduce the comparability of fair value disclosures
between financial institutions. In some cases, book value is a reasonable
estimate of fair value due to the relatively short period of time between
origination of the instrument and its expected realization. The following table
summarizes the book value and estimated fair value of financial instruments
recorded in the Consolidated Statements of Condition as well as off-balance
sheet commitments as of December 31, 2004 and 2003:

<Table>
<Caption>
                                                 ON DECEMBER 31, 2004        On December 31, 2003
                                               -------------------------   -------------------------
                                                  Book          Fair          Book          Fair
(Dollars in thousands)                            Value         Value         Value         Value
- ----------------------------------------------------------------------------------------------------
<S>                                            <C>           <C>           <C>           <C>
ASSETS:
Loans, net of unearned income:
   Floating                                    $11,821,969   $11,821,652   $ 9,188,478   $ 9,194,178
   Fixed                                         4,564,602     4,556,283     4,759,017     4,815,890
   Nonaccrual                                       41,102        41,102        43,030        43,030
   Allowance for loan losses                      (158,159)     (158,159)     (160,333)     (160,333)
- ----------------------------------------------------------------------------------------------------
Total net loans                                 16,269,514    16,260,878    13,830,192    13,892,765
Liquid assets                                    1,675,654     1,675,654     1,182,488     1,182,488
Loans held for sale                              5,167,981     5,194,866     2,977,723     2,984,219
Securities available for sale                    2,680,556     2,680,556     2,469,342     2,469,342
Securities held to maturity                            441           457         1,028         1,077
Derivative assets                                  134,451       134,451       301,196       301,196
Nonearning assets                                1,007,215     1,007,215     1,443,915     1,443,915
- ----------------------------------------------------------------------------------------------------
LIABILITIES:
Deposits:
   Defined maturity                            $10,277,438   $10,311,409   $ 7,117,213   $ 7,143,619
   Undefined maturity                            9,504,729     9,504,729     8,754,109     8,754,109
- ----------------------------------------------------------------------------------------------------
Total deposits                                  19,782,167    19,816,138    15,871,322    15,897,728
Short-term borrowings                            3,752,804     3,752,804     3,307,224     3,307,224
Term borrowings                                  2,616,368     2,647,367     1,726,766     1,748,412
Derivative liabilities                              31,268        31,268        38,890        38,890
Other noninterest-bearing liabilities              444,924       444,924       746,947       746,947
Preferred stock of subsidiary                          458           515           452           512
- ----------------------------------------------------------------------------------------------------
<Caption>
                                               Contractual      Fair       Contractual      Fair
                                                 Amount         Value        Amount         Value
- ----------------------------------------------------------------------------------------------------
<S>                                            <C>           <C>           <C>           <C>
OFF-BALANCE SHEET COMMITMENTS:
Loan commitments                               $13,622,394       $11,010   $10,081,353        $9,018
Other commitments                                  703,214         8,962       570,504         6,309
- ----------------------------------------------------------------------------------------------------
</Table>

The following describes the assumptions and methodologies used to estimate the
fair value for financial instruments:

FLOATING RATE LOANS. With the exception of floating rate 1-4 family residential
mortgage loans, the fair value is approximated by the book value. Floating rate
1-4 family residential mortgage loans reprice annually and will lag movements in
market rates; whereas, commercial and consumer loans typically reprice monthly.
The fair value for floating rate 1-4 family mortgage loans is calculated by
discounting future cash flows to their present value. Future cash flows are
discounted to their present value by using the current rates at which similar
loans would be made to borrowers with similar credit ratings and for the same
time period. Prepayment assumptions based on historical prepayment speeds and

First Horizon National Corporation    103





<Page>


NOTE 23 - FAIR VALUE OF FINANCIAL INSTRUMENTS (CONTINUED)

industry speeds for similar loans have been applied to the floating rate 1-4
family residential mortgage portfolio.

FIXED RATE LOANS. The fair value is estimated by discounting future cash flows
to their present value. Future cash flows are discounted to their present value
by using the current rates at which similar loans would be made to borrowers
with similar credit ratings and for the same time period. Prepayment assumptions
based on historical prepayment speeds and industry speeds for similar loans have
been applied to the fixed rate mortgage and installment loan portfolios.

NONACCRUAL LOANS. The fair value is approximated by the book value.

ALLOWANCE FOR LOAN LOSSES. The fair value is approximated by the book value.
Additionally, the credit exposure known to exist in the loan portfolio is
embodied in the allowance for loan losses.

LIQUID ASSETS. The fair value is approximated by the book value. For the purpose
of this disclosure, liquid assets consist of federal funds sold, securities
purchased under agreements to resell, capital markets securities inventory,
mortgage banking trading securities, and investment in bank time deposits.

LOANS HELD FOR SALE. Fair value of mortgage loans held for sale is based
primarily on quoted market prices. Fair value of home equity lines of credit
held for sale is based upon market values as evidenced in prior securitizations.
Fair value of other loans held for sale is approximated by their carrying
values.

SECURITIES AVAILABLE FOR SALE. Fair values are based primarily on quoted market
prices.

SECURITIES HELD TO MATURITY. Fair values for marketable securities are based
primarily on quoted market prices.

DERIVATIVE ASSETS. Fair values are based primarily on quoted market prices.

NONEARNING ASSETS. The fair value is approximated by the book value. For the
purpose of this disclosure, nonearning assets include cash and due from banks,
accrued interest receivable and capital markets receivables.

DEFINED MATURITY DEPOSITS. The fair value is estimated by discounting future
cash flows to their present value. Future cash flows are discounted by using the
current market rates of similar instruments applicable to the remaining
maturity. For the purpose of this disclosure, defined maturity deposits include
all certificates of deposit and other time deposits.

UNDEFINED MATURITY DEPOSITS. The fair value is approximated by the book value.
For the purpose of this disclosure, undefined maturity deposits include demand
deposits, checking interest accounts, savings accounts, and money market
accounts.

SHORT-TERM BORROWINGS. The fair value of federal funds purchased, securities
sold under agreements to repurchase, commercial paper, bank notes and other
short-term borrowings is approximated by the book value. The fair value for
Federal Home Loan Bank borrowings is determined using discounted future cash
flows.

TERM BORROWINGS. The fair value is approximated by the present value of the
contractual cash flows discounted by the investor's yield which considers FHN's
and FTBNA's debt ratings.

DERIVATIVE LIABILITIES. Fair values are based primarily on quoted market prices.

                                      104     First Horizon National Corporation





<Page>


NOTE 23 - FAIR VALUE OF FINANCIAL INSTRUMENTS (CONTINUED)

OTHER NONINTEREST-BEARING LIABILITIES. For the purpose of this disclosure, other
noninterest-bearing liabilities include accrued interest payable and capital
markets payables. The fair value is approximated by the book value.

PREFERRED STOCK OF SUBSIDIARY. The fair value is approximated by the current
trade amount of similar instruments.

LOAN COMMITMENTS. Fair values are based on fees charged to enter into similar
agreements taking into account the remaining terms of the agreements and the
counterparties' credit standing.

OTHER COMMITMENTS. Fair values are based on fees charged to enter into similar
agreements.

First Horizon National Corporation    105






<Page>



NOTE 24 - SECURITIZATIONS

During 2004 and 2003, FHN securitized $26.4 billion and $46.1 billion,
respectively, of single-family residential loans in primarily proprietary and
agency securitization transactions, and the resulting securities were sold as
senior and subordinate certificates. In 2004 and 2003, FHN recognized net
pre-tax gains of $332.4 million and $566.9 million, respectively, from the sale
of securitized loans which includes gains recognized on the capitalization of
MSR associated with these loans. In 2004 and 2003, FHN capitalized approximately
$319.2 million and $536.7 million, respectively, in originated MSR. These MSR,
as well as other MSR held by FHN, are discussed further in Note 6 - Mortgage
Servicing Rights. In certain cases, FHN continues to service and receive
servicing fees related to the securitized loans, and has also retained residual
interest certificates or financial assets including excess interest (structured
as interest-only strips), principal-only strips, interest-only strips, or
subordinated bonds. FHN received annual servicing fees approximating .31 percent
in 2004 and .32 percent in 2003 of the outstanding balance of underlying
mortgage loans. FHN received annual servicing fees approximating .50 percent in
2004 of the outstanding balance of underlying loans for HELOC securitizations.
Additionally, FHN retained rights to future cash flows on the HELOC
securitizations arising after investors in the securitization trust have
received the return for which they contracted. The investors and the
securitization trusts have no recourse to other assets of First Horizon Home
Loans or FHN for failure of debtors to pay when due.

The sensitivity of the current fair value of retained interests for MSR to
immediate 10 percent and 20 percent adverse changes in assumptions on
December 31, 2004, are as follows:

<Table>
<Caption>

(Dollars in thousands                                            MSR                   MSR                MSR
 except for annual cost to service)                           1st Liens             2nd Liens            HELOC
- ---------------------------------------------------------------------------------------------------------------
<S>                                                           <C>                    <C>                 <C>
DECEMBER 31, 2004
Fair value of retained interests                              $1,038,967             $2,116              $8,638
Weighted average life (in years)                                     5.7                2.9                 2.0

Annual prepayment rate                                              13.7%              30.0%               45.0%
 Impact on fair value of 10% adverse change                   $  (47,235)            $  (97)             $ (612)
 Impact on fair value of 20% adverse change                      (90,650)              (184)             (1,159)

Annual discount rate on residual cash flows                         10.1%              14.0%               18.0%
 Impact on fair value of 10% adverse change                   $  (37,084)            $  (57)             $ (196)
 Impact on fair value of 20% adverse change                      (71,576)              (111)               (383)

Annual cost to service (per loan)                                    $45                $50                 $50
 Impact on fair value of 10% adverse change                   $  (11,196)            $  (61)             $ (175)
 Impact on fair value of 20% adverse change                      (22,392)              (122)               (351)

Annual earnings on escrow                                            3.4%               2.0%                2.0%
 Impact on fair value of 10% adverse change                   $  (18,944)            $  (29)             $ (172)
 Impact on fair value of 20% adverse change                      (37,888)               (59)               (343)
- ---------------------------------------------------------------------------------------------------------------
</Table>

                                      106     First Horizon National Corporation





<Page>



NOTE 24 - SECURITIZATIONS (CONTINUED)

The sensitivity of the current fair value of retained interests for other
residuals to immediate 10 percent and 20 percent adverse changes in assumptions
on December 31, 2004, are as follows:

<Table>
<Caption>
                                                                                                     Residual       Residual
                                                  Excess                                             Interest       Interest
(Dollars in thousands                            Interest   Certificated            Subordinated   Certificates   Certificates
except for annual cost to service)                  IO           PO          IO         Bonds        2nd liens        HELOC
- ------------------------------------------------------------------------------------------------------------------------------
<S>                                              <C>          <C>          <C>         <C>            <C>           <C>
DECEMBER 31, 2004
Fair value of retained interests                 $199,595     $15,914      $4,690      $5,272         $9,321        $54,959
Weighted average life (in years)                      6.0         4.8         3.4         6.0            2.9            2.1

Annual prepayment rate                               11.0%       17.6%       25.0%       45.0%          30.0%          45.0%
 Impact on fair value of 10% adverse change      $ (8,098)    $  (433)     $ (339)     $    5         $ (536)       $(3,819)
 Impact on fair value of 20% adverse change       (15,647)       (927)       (915)         15         (1,023)        (7,272)

Annual discount rate on residual cash flows          11.5%        7.7%       13.0%        7.1%          20.0%          18.0%
 Impact on fair value of 10% adverse change      $ (7,673)    $  (403)     $ (133)     $ (154)        $ (561)       $(1,969)
 Impact on fair value of 20% adverse change       (14,786)       (785)       (272)       (303)        (1,077)        (3,820)

Annual cost to service                                N/A         N/A         N/A         N/A            N/A            N/A
 Impact on fair value of 10% adverse change           N/A         N/A         N/A         N/A            N/A            N/A
 Impact on fair value of 20% adverse change           N/A         N/A         N/A         N/A            N/A            N/A

Annual earnings on escrow                             N/A         N/A         N/A         N/A            N/A            N/A
 Impact on fair value of 10% adverse change           N/A         N/A         N/A         N/A            N/A            N/A
 Impact on fair value of 20% adverse change           N/A         N/A         N/A         N/A            N/A            N/A
- ------------------------------------------------------------------------------------------------------------------------------
</Table>

These sensitivities are hypothetical and should not be considered to be
predictive of future performance. As the figures indicate, changes in fair value
based on a 10 percent variation in assumptions generally cannot necessarily be
extrapolated because the relationship of the change in assumption to the change
in fair value may not be linear. Also, in this table, the effect of a variation
in a particular assumption on the fair value of the retained interest is
calculated independently from any change in another assumption. In reality,
changes in one factor may result in changes in another, which might magnify or
counteract the sensitivities. Furthermore, the estimated fair values as
disclosed should not be considered indicative of future earnings on these
assets.

FHN uses assumptions and estimates in determining the fair value allocated to
retained interests at the time of initial securitization. The key economic
assumptions used to measure the fair value of the MSR at the date of
securitization were as follows:

<Table>
<Caption>
                                                                  MSR           MSR          MSR
                                                               1st Liens     2nd Liens      HELOC
- ----------------------------------------------------------------------------------------------------
<S>                                                           <C>             <C>          <C>
2004
Weighted average life (in years)                                5.0-6.5          2.9       1.7-2.0
Annual prepayment rate                                        11.3%-16.1%      30.0%       40%-45%
Annual discount rate                                          10.1%-10.2%      20.0%       18%-20%
Annual cost to service (per loan)                               $44-$45          $50         $50
Annual earnings on escrow                                     2.73%-3.76%       2.0%        2.0%
- ----------------------------------------------------------------------------------------------------
2003
Weighted average life (in years)                                2.6-5.9          N/A         N/A
Annual prepayment rate                                        12.4%-29.8%        N/A         N/A
Annual discount rate                                          10.3%-10.5%        N/A         N/A
Annual cost to service (per loan)                               $44-$45          N/A         N/A
Annual earnings on escrow                                      2.3%-3.6%         N/A         N/A
- ----------------------------------------------------------------------------------------------------
</Table>

First Horizon National Corporation    107





<Page>



NOTE 24 - SECURITIZATIONS (CONTINUED)

The key economic assumptions used to measure the fair value of other retained
interests at the date of securitization were as follows:

<Table>
<Caption>
                                    Excess                                           Residual Interest  Residual Interest
                                   Interest     Certificated           Subordinated    Certificates       Certificates
                                      IO             PO         IO         Bond          2nd Liens            HELOC
- -------------------------------------------------------------------------------------------------------------------------
<S>                              <C>            <C>           <C>      <C>           <C>                <C>
2004
Weighted average life
 (in years)                        5.1-6.8        1.8-9.4     3.3-6.2      7.6              2.9              1.7-2.0
Annual prepayment rate            9.3%-14.4%     7.6%-40.0%    25.0%      40.0%            30.0%             40%-45%
Annual discount rate                11.5%       5.11%-17.93%   13.0%    6.1%-8.8%          20.0%             18%-20%
- -------------------------------------------------------------------------------------------------------------------------
2003
Weighted average life
 (in years)                        3.5-6.8        6.4-6.5       N/A        N/A              N/A                N/A
Annual prepayment rate           12.4%-29.8%       15.0%        N/A        N/A              N/A                N/A
Annual discount rate             10.3%-10.5%     5.5%-6.9%      N/A        N/A              N/A                N/A
- -------------------------------------------------------------------------------------------------------------------------
</Table>

FTN Financial Capital Assets Corporation (FTNFCAC), an indirect wholly-owned
subsidiary of FHN, enters into transactions where mortgage loans are purchased,
pooled, securitized and sold. During 2004 and 2003, $154.6 million and $528.0
million of mortgage loans were sold for pre-tax gains of $3.3 million and $5.3
million, respectively, that were recognized in capital markets noninterest
income. FTNFCAC does not retain servicing rights or any other form of retained
interest on these securitizations.

FHN has also securitized certain real estate loans through a real estate
mortgage investment conduit (REMIC) in prior years and retained all of the
securitized assets. Fair value for these securities was based upon cash flows
discounted at a market yield. Market yields were computed by adding Treasury
yields at year-end plus an appropriate spread estimated by observing quotes on
similarly structured marketable securities and changes in swap spreads.

For the years ended December 31, 2004, 2003 and 2002, cash flows received and
paid related to securitizations were as follows:

<Table>
<Caption>

(Dollars in thousands)                                               2004          2003          2002
- -----------------------------------------------------------------------------------------------------
<S>                                                           <C>           <C>           <C>
Proceeds from initial securitizations                         $26,834,087   $47,037,436   $30,338,111
Servicing fees received                                           232,566       186,728       168,028
Purchases of GNMA guaranteed mortgages                            315,646       554,483       786,725
Purchases of delinquent or foreclosed assets                       13,213        33,581        67,186
Other cash flows received on retained interests*                    6,416       181,512       153,734
- -----------------------------------------------------------------------------------------------------
</Table>

* Other cash flows include all cash flows from other retained interests and
  REMIC securities.

As of December 31, 2004, the principal amount of loans securitized and other
loans managed with them, and the principal amount of delinquent loans, in
addition to net credit losses during 2004 are as follows:

<Table>
<Caption>
                                                                                  Principal Amount
                                                              Total Principal      of Delinquent          Net Credit
(Dollars in thousands)                                        Amount of Loans          Loans*               Losses
- ------------------------------------------------------------------------------------------------------------------------
                                                                                                       FOR THE YEAR ENDED
                                                                       ON DECEMBER 31, 2004            DECEMBER 31, 2004
                                                              --------------------------------------   ------------------
<S>                                                             <C>                   <C>                   <C>
Type of loan:
 Real estate residential                                        $70,584,410           $295,257              $19,864
- -----------------------------------------------------------------------------         --------         -----------------
Total loans managed or securitized**                             70,584,410           $295,257              $19,864
                                                                                      ========         =================
Loans securitized and sold                                      (58,302,285)
Loans held for sale or securitization                            (5,037,409)
- -----------------------------------------------------------------------------
 Loans held in portfolio                                        $ 7,244,716
=============================================================================
</Table>

 * Nonaccrual loans and loans 90 days or more past due including $179.8
   million of GNMA guaranteed mortgages.
** Securitized loans are real estate residential loans in which FHN has a
   retained interest other than servicing rights.

                                     108     First Horizon National Corporation





<Page>



NOTE 25 - VARIABLE INTEREST ENTITIES

On March 31, 2004, FHN adopted FASB Interpretation No. 46 (FIN 46-R),
'Consolidation of Variable Interest Entities (revised December 2003)'. FIN 46-R
clarifies certain aspects of FIN 46 and provides certain entities with
exemptions from the requirements of FIN 46. Additionally, FIN 46-R incorporates
the guidance found in eight final FASB Staff Positions (FSPs) that had been
issued prior to its release. FIN 46-R requires the consolidation by a business
enterprise of variable interest entities (VIE) in which it is the primary
beneficiary. FIN 46-R also required the adoption of FIN 46, as of December 31,
2003, for all entities previously considered as special purpose entities and for
all VIE created after January 31, 2003. Upon adoption of FIN 46-R, FHN
reassessed certain of its nonconsolidated interests as VIE but did not meet the
criteria of primary beneficiary and, therefore, has not consolidated any of its
VIE.

On December 31, 2003, FHN adopted FASB Interpretation No. 46 (FIN 46),
'Consolidation of Variable Interest Entities'. FHN identified certain of its
nonconsolidated interests as VIE but did not meet the criteria of primary
beneficiary and, therefore, has not consolidated any of its VIE. Upon adoption
of this standard, FHN deconsolidated its subsidiary, Capital I, which has issued
$100.0 million of capital securities that are fully and unconditionally
guaranteed by FHN.

Since 1997, First Tennessee Housing Corporation (FTHC), a wholly-owned
subsidiary, makes equity investments as a limited partner, in various
partnerships that sponsor affordable housing projects utilizing the Low Income
Housing Tax Credit (LIHTC) pursuant to Section 42 of the Internal Revenue Code.
The purpose of these investments is to achieve a satisfactory return on capital
and to support FHN's community reinvestment initiatives. The activities of the
limited partnerships include the identification, development, and operation of
multi-family housing that is leased to qualifying residential tenants generally
within FHN's primary geographic region. On December 31, 2004 and 2003, FTHC's
maximum exposure to loss resulting from those LIHTC investments was $112.9
million and $118.9 million, respectively. This represents the investment value
of $106.3 million and $108.7 million included in 'Capital markets receivables
and other assets' on the Consolidated Statements of Condition and unfunded
commitments of $6.6 million and $10.2 million on December 31, 2004 and 2003,
respectively.

First Horizon National Corporation    109








<Page>



NOTE 26 - PARENT COMPANY FINANCIAL INFORMATION

Following are condensed statements of the parent company:

<Table>
<Caption>

STATEMENTS OF CONDITION                                                       December 31
- ------------------------------------------------------------------------------------------------
(Dollars in thousands)                                                      2004         2003
- ------------------------------------------------------------------------------------------------
<S>                                                                      <C>          <C>
ASSETS:
Cash                                                                     $       46   $        -
Securities purchased from subsidiary bank under agreements to resell        148,393       34,239
- ------------------------------------------------------------------------------------------------
 Total cash and cash equivalents                                            148,439       34,239
Investment in bank time deposits                                             30,777      153,967
Securities available for sale                                                32,976       50,485
Investments in subsidiaries:
 Bank                                                                     2,306,458    1,953,985
 Non-bank                                                                    34,239       35,136
Other assets                                                                249,683      168,819
- ------------------------------------------------------------------------------------------------
TOTAL ASSETS                                                             $2,802,572   $2,396,631
================================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY:
Commercial paper and other short-term borrowings                         $   23,712   $   31,793
Accrued employee benefits and other liabilities                             278,834      202,148
Term borrowings                                                             459,043      272,372
- ------------------------------------------------------------------------------------------------
 Total liabilities                                                          761,589      506,313
Shareholders' equity                                                      2,040,983    1,890,318
- ------------------------------------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                               $2,802,572   $2,396,631
================================================================================================
</Table>

<Table>
<Caption>

STATEMENTS OF INCOME                                              Year Ended December 31
- --------------------------------------------------------------------------------------------
(Dollars in thousands)                                          2004       2003       2002
- --------------------------------------------------------------------------------------------
<S>                                                           <C>        <C>        <C>
Dividend income:
 Bank                                                         $110,109   $272,987   $159,332
 Non-bank                                                        9,059      8,545      7,708
- --------------------------------------------------------------------------------------------
Total dividend income                                          119,168    281,532    167,040
Interest income                                                  3,816      3,848      3,491
Other income                                                     4,801        686        228
- --------------------------------------------------------------------------------------------
 Total income                                                  127,785    286,066    170,759
- --------------------------------------------------------------------------------------------
Interest expense:
 Short-term debt                                                   252        314        395
 Term borrowings                                                13,581     15,352     16,061
- --------------------------------------------------------------------------------------------
Total interest expense                                          13,833     15,666     16,456
Compensation, employee benefits and other expense               28,944     59,863     25,685
- --------------------------------------------------------------------------------------------
 Total expense                                                  42,777     75,529     42,141
- --------------------------------------------------------------------------------------------
Income before income taxes and equity in undistributed net
 income of subsidiaries                                         85,008    210,537    128,618
Applicable income taxes                                        (20,899)   (34,125)   (18,375)
- --------------------------------------------------------------------------------------------
Income before equity in undistributed net income of
 subsidiaries                                                  105,907    244,662    146,993
Equity in undistributed net income of subsidiaries:
 Bank                                                          349,999    229,404    228,949
 Non-bank                                                       (1,498)      (757)       509
- --------------------------------------------------------------------------------------------
NET INCOME                                                    $454,408   $473,309   $376,451
============================================================================================
</Table>

                                      110     First Horizon National Corporation





<Page>



NOTE 26 - PARENT COMPANY FINANCIAL INFORMATION (CONTINUED)

<Table>
<Caption>

STATEMENTS OF CASH FLOWS                                          Year Ended December 31
- --------------------------------------------------------------------------------------------
(Dollars in thousands)                                          2004       2003       2002
- --------------------------------------------------------------------------------------------
<S>                                                           <C>        <C>        <C>
OPERATING ACTIVITIES:
Net income                                                    $454,408   $473,309   $376,451
Less undistributed net income of subsidiaries                  348,501    228,647    229,458
- --------------------------------------------------------------------------------------------
Income before undistributed net income of subsidiaries         105,907    244,662    146,993
Adjustments to reconcile income to net cash provided by
 operating  activities:
 Deferred income tax benefit                                   (10,657)      (319)      (575)
 Depreciation and amortization                                   5,122      9,182      3,477
 Loss on debt purchase                                               -      5,766          -
 (Gain)/loss on sale of securities                              (2,408)      (284)        49
 Net change in interest receivable and other assets            (63,809)  (116,934)      (309)
 Net change in interest payable and other liabilities           69,293    108,740     16,949
- --------------------------------------------------------------------------------------------
Total adjustments                                               (2,459)     6,151     19,591
- --------------------------------------------------------------------------------------------
Net cash provided by operating activities                      103,448    250,813    166,584
- --------------------------------------------------------------------------------------------
INVESTING ACTIVITIES:
Securities:
 Sales and prepayments                                          20,926        356        212
 Purchases                                                        (190)      (362)      (450)
Decrease/(increase) in investment in bank time deposits        123,190    (56,000)    14,000
Advances to subsidiaries                                             -          -        (35)
Proceeds from sale of a subsidiary                                   -     49,833          -
Return on investment in subsidiary                               5,005      1,614     10,000
Cash investments in subsidiaries                               (10,000)    (1,930)    (1,945)
- --------------------------------------------------------------------------------------------
Net cash provided/(used) by investing activities               138,931     (6,489)    21,782
- --------------------------------------------------------------------------------------------
FINANCING ACTIVITIES:
Common stock:
 Exercise of stock options                                      67,935     77,591     51,015
 Cash dividends                                               (198,495)  (150,863)  (125,736)
 Repurchase of shares                                         (184,224)  (209,263)  (111,187)
Term borrowings:
 Payment                                                        (9,500)   (57,739)         -
 Issuance                                                      204,186     99,350          -
(Decrease)/increase in short-term borrowings                    (8,081)     4,098      3,422
- --------------------------------------------------------------------------------------------
Net cash used by financing activities                         (128,179)  (236,826)  (182,486)
- --------------------------------------------------------------------------------------------
Net increase in cash and cash equivalents                      114,200      7,498      5,880
- --------------------------------------------------------------------------------------------
Cash and cash equivalents at beginning of year                  34,239     26,741     20,861
- --------------------------------------------------------------------------------------------
Cash and cash equivalents at end of year                      $148,439   $ 34,239   $ 26,741
============================================================================================
Total interest paid                                           $ 11,132   $ 15,326   $ 16,210
Total income taxes paid                                        159,700    133,950    120,740
- --------------------------------------------------------------------------------------------
</Table>



First Horizon National Corporation    111








<Page>



CONSOLIDATED AVERAGE BALANCE SHEETS AND RELATED YIELDS AND RATES (UNAUDITED)

<Table>
<Caption>
- -----------------------------------------------------------------------------------------------------------------------------
                                                              2004                             2003                 Average
                                                 ------------------------------   ------------------------------    Balance
                                                             Interest   Average               Interest   Average   Growth (%)
(Fully taxable equivalent)                        Average    Income/    Yields/    Average    Income/    Yields/   ----------
(Dollars in millions)                             Balance    Expense     Rates     Balance    Expense     Rates      04/03
- -----------------------------------------------------------------------------------------------------------------------------
<S>                                              <C>         <C>        <C>        <C>        <C>        <C>       <C>
ASSETS:
Earning assets:
Loans, net of unearned income**                  $15,384.6   $  775.1     5.04%   $12,656.3   $  658.1    5.20%       21.6 +
Investment securities:
 U.S. Treasuries                                      48.4         .8     1.67         45.3         .7     1.62        6.8 +
 U.S. government agencies                          2,194.9       95.6     4.35      2,107.6       88.7     4.21        4.1 +
 States and municipalities                            10.8         .7     6.52         22.1        1.5     6.80       51.1 -
 Other                                               195.0        7.7     3.96        369.9       21.0     5.69       47.3 -
- ----------------------------------------------------------------------------------------------------------------
  Total investment securities                      2,449.1      104.8     4.28      2,544.9      111.9     4.40        3.8 -
- ----------------------------------------------------------------------------------------------------------------
Other earning assets:
 Loans held for sale                               4,179.4      226.8     5.43      4,420.7      229.1     5.18        5.5 -
 Investment in bank time deposits                      8.6         .1     1.04          1.7         .1      .82      405.9 +
 Federal funds sold and securities purchased
  under agreements to resell                         722.2        7.6     1.06        656.3        4.9      .75       10.0 +
 Mortgage banking trading securities                 221.3       26.7    12.05        154.7       16.9    10.94       43.1 +
 Capital markets securities inventory                753.1       26.8     3.56        894.3       33.7     3.76       15.8 -
- ----------------------------------------------------------------------------------------------------------------
  Total other earning assets                       5,884.6      288.0     4.90      6,127.7      284.7     4.65        4.0 -
- ----------------------------------------------------------------------------------------------------------------
Total earning assets                              23,718.3    1,167.9     4.92     21,328.9    1,054.7     4.94       11.2 +
Allowance for loan losses                           (165.2)                          (160.3)                           3.1 +
Cash and due from banks                              739.2                            748.3                            1.2 -
Premises and equipment, net                          364.4                            300.7                           21.2 +
Capital markets receivables and other assets       2,649.1                          2,916.0                            9.2 -
- ----------------------------------------------------------------------------------------------------------------
Total assets/Interest income                     $27,305.8   $1,167.9             $25,133.6   $1,054.7                 8.6 +
================================================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY:
Interest-bearing liabilities:
Interest-bearing deposits:
 Savings                                         $   293.8   $     .4      .14%   $   306.1   $     .8     .27%        4.0 -
 Checking interest and money market                3,846.1       24.0      .62      3,659.7       22.8      .62        5.1 +
 Certificates of deposit under $100,000 and
  other time                                       1,947.0       60.1     3.08      1,866.3       57.1     3.06        4.3 +
- ----------------------------------------------------------------------------------------------------------------
  Total interest-bearing core deposits             6,086.9       84.5     1.39      5,832.1       80.7     1.38        4.4 +
Certificates of deposit $100,000 and more          6,875.3      108.0     1.57      5,165.5       69.4     1.34       33.1 +
Federal funds purchased and securities sold
 under agreements to repurchase                    3,685.2       45.1     1.22      3,712.7       36.9      .99         .7 -
Commercial paper and other short-term
 borrowings                                          614.1       22.7     3.69        659.9       25.2     3.82        6.9 -
Term borrowings                                    2,248.0       50.2     2.24      1,342.9       35.4     2.64       67.4 +
- ----------------------------------------------------------------------------------------------------------------
Total interest-bearing liabilities                19,509.5      310.5     1.59     16,713.1      247.6     1.48       16.7 +
Demand deposits                                    1,805.6                          2,076.0                           13.0 -
Other noninterest-bearing deposits                 2,867.7                          3,038.0                            5.6 -
Capital markets payables and other liabilities     1,217.0                          1,383.9                           12.1 -
Guaranteed preferred beneficial interests in
 First Horizon's junior subordinated debentures
 (Note 11)                                               -                            100.0                          100.0 -
Preferred stock of subsidiary (Note 12)                 .5                             22.2                           97.7 -
Shareholders' equity                               1,905.5                          1,800.4                            5.8 +
- ----------------------------------------------------------------------------------------------------------------
Total liabilities and shareholders'
 equity/Interest expense                         $27,305.8   $  310.5             $25,133.6   $  247.6                 8.6 +
================================================================================================================
Net interest income-tax equivalent basis/Yield               $  857.4     3.62%               $  807.1    3.78%
Fully taxable equivalent adjustment                              (1.1)                            (1.3)
- ----------------------------------------------------------------------------------------------------------------
Net interest income                                          $  856.3                         $  805.8
================================================================================================================
Net interest spread                                                       3.33%                           3.46%
Effect of interest-free sources used to fund
 earning assets                                                            .29                              .32
- ----------------------------------------------------------------------------------------------------------------
Net interest margin                                                       3.62%                           3.78%
================================================================================================================
</Table>

Certain previously reported amounts have been reclassified to agree with current
presentation.
Yields and corresponding income amounts are adjusted to a fully taxable
equivalent. Earning assets yields are expressed net of unearned income. Rates
are expressed net of unamortized debenture cost for long-term debt. Net interest
margin is computed using total net interest income.

                                      112     First Horizon National Corporation







<Page>

<Table>
<Caption>
- ------------------------------------------------------------------------------------------------------------------------
                                                                2002                                2001
                                                 -----------------------------------   ------------------------------
                                                                  Interest   Average               Interest   Average
(Fully taxable equivalent)                             Average    Income/    Yields/    Average    Income/    Yields/
(Dollars in millions)                                  Balance    Expense    Rates      Balance    Expense    Rates
- ------------------------------------------------------------------------------------------------------------------------
<C>                                              <S>              <C>        <C>       <C>         <C>        <C>
ASSETS:
Earning assets:
Loans, net of unearned income**                       $10,634.5   $  666.6     6.27%   $10,104.3   $  812.5    8.04%
Investment securities:
 U.S. Treasuries                                           55.5        1.7     3.04         31.5        1.6    4.98
 U.S. government agencies                               1,819.7      106.8     5.87      1,781.0      116.5    6.54
 States and municipalities                                 34.9        2.5     7.30         50.8        3.8    7.53
 Other                                                    556.3       32.8     5.89        732.0       47.5    6.49
- ------------------------------------------------------------------------------------------------------------------------
  Total investment securities                           2,466.4      143.8     5.83      2,595.3      169.4    6.53
- ------------------------------------------------------------------------------------------------------------------------
Other earning assets:
 Loans held for sale                                    3,024.2      184.0     6.09      2,388.0      165.9    6.95
 Investment in bank time deposits                           1.8         .1     2.07          1.9         .1    6.56
 Federal funds sold and securities purchased
  under agreements to resell                              404.8        5.5     1.35        226.5        7.0    3.07
 Mortgage banking trading securities                      131.3       12.5     9.55        127.5       12.1    9.48
 Capital markets securities inventory                     734.4       31.2     4.25        681.9       36.6    5.37
- ------------------------------------------------------------------------------------------------------------------------
  Total other earning assets                            4,296.5      233.3     5.43      3,425.8      221.7    6.47
- ------------------------------------------------------------------------------------------------------------------------
Total earning assets                                   17,397.4    1,043.7     6.00     16,125.4    1,203.6    7.46
Allowance for loan losses                                (151.2)                          (145.2)
Cash and due from banks                                   775.3                            756.5
Premises and equipment, net                               246.3                            268.7
Capital markets receivables and other assets            2,436.2                          2,221.8
- ------------------------------------------------------------------------------------------------------------------------
Total assets/Interest income                          $20,704.0   $1,043.7             $19,227.2   $1,203.6
========================================================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY:
Interest-bearing liabilities:
Interest-bearing deposits:
 Savings                                              $   302.7   $    2.2      .72%   $   304.4   $    3.8    1.26%
 Checking interest and money market                     3,557.5       37.1     1.04      3,548.2       84.9    2.39
 Certificates of deposit under $100,000 and
  other time                                            1,937.1       71.2     3.68      2,092.3      111.1    5.31
- ------------------------------------------------------------------------------------------------------------------------
  Total interest-bearing core deposits                  5,797.3      110.5     1.91      5,944.9      199.8    3.36
Certificates of deposit $100,000 and more               3,843.0       79.8     2.08      3,142.7      137.1    4.36
Federal funds purchased and securities sold
 under agreements to repurchase                         3,134.3       45.5     1.45      3,162.7      115.6    3.66
Commercial paper and other short-term
 borrowings                                               537.4       22.2     4.13        565.3       29.9    5.30
Term borrowings                                           685.5       28.6     4.17        521.5       30.2    5.79
- ------------------------------------------------------------------------------------------------------------------------
Total interest-bearing liabilities                     13,997.5      286.6     2.05     13,337.1      512.6    3.84
Demand deposits                                         1,882.0                          1,660.7
Other noninterest-bearing deposits                      2,152.5                          1,792.3
Capital markets payables and other liabilities            959.4                            891.8
Guaranteed preferred beneficial interests in
 First Horizon's junior subordinated debentures
 (Note 11)                                                100.0                            100.0
Preferred stock of subsidiary (Note 12)                    44.3                             44.0
Shareholders' equity                                    1,568.3                          1,401.3
- ------------------------------------------------------------------------------------------------------------------------
Total liabilities and shareholders'
 equity/Interest expense                              $20,704.0   $  286.6             $19,227.2   $  512.6
========================================================================================================================
Net interest income-tax equivalent basis/Yield                    $  757.1     4.35%               $  691.0    4.29%
Fully taxable equivalent adjustment                                   (1.5)                            (2.1)
- ------------------------------------------------------------------------------------------------------------------------
Net interest income                                               $  755.6                         $  688.9
========================================================================================================================
Net interest spread                                                            3.95%                           3.62%
Effect of interest-free sources used to fund
 earning assets                                                                 .40                             .67
- ------------------------------------------------------------------------------------------------------------------------
Net interest margin                                                            4.35%                           4.29%
========================================================================================================================


<Caption>
- -------------------------------------------------------------------------------------------------------------------------------
                                                              2000                        1999                        Average
                                                 ------------------------------   --------------------  ----------    Balance
                                                             Interest   Average               Interest    Average    Growth (%)
(Fully taxable equivalent)                        Average    Income/    Yields/    Average    Income/     Yields/  ------------
(Dollars in millions)                             Balance    Expense    Rates      Balance    Expense     Rates        04/99*
- ------------------------------------------------------------------------------------------------------ ------------------------
<C>                                              <S>         <C>        <C>       <C>         <C>           <C>         <C>
ASSETS:
Earning assets:
Loans, net of unearned income**                  $ 9,932.0   $  915.9     9.22%   $ 8,818.8   $  754.6      8.56%       11.8 +
Investment securities:
 U.S. Treasuries                                      33.0        2.1     6.41         79.2        5.0      6.30         9.4 -
 U.S. government agencies                          1,734.7      117.7     6.78      1,631.9      105.5      6.46         6.1 +
 States and municipalities                            48.7        3.6     7.49         50.7        3.8      7.56        26.6 -
 Other                                             1,046.3       76.8     7.34        940.9       66.2      7.04        27.0 -
- ------------------------------------------------------------------------------------------------------------------
  Total investment securities                      2,862.7      200.2     6.99      2,702.7      180.5      6.68         2.0 -
- ------------------------------------------------------------------------------------------------------------------
Other earning assets:
 Loans held for sale                               2,450.8      197.3     8.05      3,217.7      231.3      7.19         5.4 +
 Investment in bank time deposits                      2.1         .1     5.07          9.8         .5      4.76         2.6 -
 Federal funds sold and securities purchased
  under agreements to resell                         328.4       20.0     6.10        292.6       13.9      4.75        19.8 +
 Mortgage banking trading securities                     -          -        -            -          -         -         N/A
 Capital markets securities inventory                519.5       34.7     6.68        542.1       31.6      5.82         6.8 +
- ------------------------------------------------------------------------------------------------------------------
  Total other earning assets                       3,300.8      252.1     7.64      4,062.2      277.3      6.82         7.7 +
- ------------------------------------------------------------------------------------------------------------------
Total earning assets                              16,095.5    1,368.2     8.50     15,583.7    1,212.4      7.78         8.8 +
Allowance for loan losses                           (140.0)                          (136.7)                             3.9 +
Cash and due from banks                              815.8                            779.3                              1.1 -
Premises and equipment, net                          294.6                            288.5                              4.8 +
Capital markets receivables and other assets       2,259.4                          2,110.5                              4.7 +
- ------------------------------------------------------------------------------------------------------------------
Total assets/Interest income                     $19,325.3   $1,368.2             $18,625.3   $1,212.4                   8.0 +
==================================================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY:
Interest-bearing liabilities:
Interest-bearing deposits:
 Savings                                         $   337.4   $    5.5     1.64%   $   350.0   $    5.8      1.65%        3.4 -
 Checking interest and money market                3,371.5      110.8     3.29      3,551.2      104.3      2.94         1.6 +
 Certificates of deposit under $100,000 and
  other time                                       2,310.3      129.2     5.59      2,398.4      123.8      5.16         4.1 -
- ------------------------------------------------------------------------------------------------------------------
  Total interest-bearing core deposits             6,019.2      245.5     4.08      6,299.6      233.9      3.71          .7 -
Certificates of deposit $100,000 and more          3,959.7      254.9     6.44      3,163.9      165.9      5.24        16.8 +
Federal funds purchased and securities sold
 under agreements to repurchase                    2,899.4      169.4     5.84      2,292.9      104.7      4.57        10.0 +
Commercial paper and other short-term
 borrowings                                        1,050.4       70.6     6.72      1,631.4       88.4      5.42        17.8 -
Term borrowings                                      384.3       24.3     6.34        371.1       24.8      6.69        43.4 +
- ------------------------------------------------------------------------------------------------------------------
Total interest-bearing liabilities                14,313.0      764.7     5.34     13,758.9      617.7      4.49         7.2 +
Demand deposits                                    1,759.2                          1,974.1                              1.8 -
Other noninterest-bearing deposits                 1,193.9                            972.0                             24.2 +
Capital markets payables and other liabilities       675.1                            633.5                             13.9 +
Guaranteed preferred beneficial interests in
 First Horizon's junior subordinated debentures
 (Note 11)                                           100.0                            100.0                            100.0 -
Preferred stock of subsidiary (Note 12)                7.5                                -                              N/A
Shareholders' equity                               1,276.6                          1,186.8                              9.9 +
- ------------------------------------------------------------------------------------------------------------------
Total liabilities and shareholders'
 equity/Interest expense                         $19,325.3   $  764.7             $18,625.3   $  617.7                   8.0 +
==================================================================================================================
Net interest income-tax equivalent basis/Yield               $  603.5     3.75%               $  594.7      3.82%
Fully taxable equivalent adjustment                              (2.6)                            (3.0)
- ------------------------------------------------------------------------------------------------------------------
Net interest income                                          $  600.9                         $  591.7
==================================================================================================================
Net interest spread                                                       3.16%                             3.29%
Effect of interest-free sources used to fund
 earning assets                                                            .59                               .53
- ------------------------------------------------------------------------------------------------------------------
Net interest margin                                                       3.75%                             3.82%
==================================================================================================================
</TABLE>
 * Compound annual growth rate
** Includes loans on nonaccrual status.

First Horizon National Corporation    113




<Page>


            CONSOLIDATED HISTORICAL STATEMENTS OF INCOME (UNAUDITED)
<Table>
<Caption>
- ------------------------------------------------------------------------------------------------------------
(Dollars in millions except per share data)    2004       2003       2002       2001       2000       1999
- ------------------------------------------------------------------------------------------------------------
<S>                                          <C>        <C>        <C>        <C>        <C>        <C>
INTEREST INCOME:
Interest and fees on loans                   $  774.7   $  657.6   $  666.0   $  811.7   $  915.0   $  753.7
Investment securities                           104.2      111.2      143.0      168.2      198.8      178.6
Loans held for sale                             226.8      229.1      184.0      165.9      197.3      231.3
Trading securities inventory                     53.4       50.5       43.7       48.6       34.4       31.4
Other earning assets                              7.7        5.0        5.5        7.1       20.1       14.4
- ------------------------------------------------------------------------------------------------------------
  Total interest income                       1,166.8    1,053.4    1,042.2    1,201.5    1,365.6    1,209.4
- ------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE:
Deposits:
 Savings                                           .4         .8        2.2        3.8        5.5        5.8
 Checking interest and money market              24.0       22.8       37.0       84.9      110.8      104.3
 Certificates of deposit under $100,000 and
  other time                                     60.1       57.2       71.3      111.1      129.2      123.8
 Certificates of deposit $100,000 and more      108.0       69.3       79.8      137.1      254.9      165.9
Short-term borrowings                            67.7       62.1       67.7      145.5      240.0      193.1
Term borrowings                                  50.3       35.4       28.6       30.2       24.3       24.8
- ------------------------------------------------------------------------------------------------------------
  Total interest expense                        310.5      247.6      286.6      512.6      764.7      617.7
- ------------------------------------------------------------------------------------------------------------
NET INTEREST INCOME                             856.3      805.8      755.6      688.9      600.9      591.7
Provision for loan losses                        48.3       86.7       92.2       93.2       67.5       57.4
- ------------------------------------------------------------------------------------------------------------
NET INTEREST INCOME AFTER PROVISION             808.0      719.1      663.4      595.7      533.4      534.3
- ------------------------------------------------------------------------------------------------------------
NONINTEREST INCOME:
Mortgage banking                                444.8      649.5      436.7      285.0      122.5      298.2
Capital markets                                 376.5      538.9      448.0      344.3      118.7      126.9
Deposit transactions and cash management        148.5      146.7      143.3      133.6      116.1      106.2
Merchant processing                              75.1       57.6       48.4       45.4       48.2       49.7
Insurance commissions                            56.1       57.8       50.4       16.8       12.2       10.9
Trust services and investment management         47.3       45.9       48.4       56.7       65.8       59.8
Gains on divestitures                             7.0       22.5        4.6       80.4      157.6        4.2
Equity securities gains/(losses), net             2.0        8.5       (9.4)      (3.3)        .8        2.3
Debt securities gains/(losses), net              18.7       (6.1)        .2       (1.0)      (5.0)         -
All other income                                187.1      146.3      141.3      137.1      160.2      130.3
- ------------------------------------------------------------------------------------------------------------
  Total noninterest income                    1,363.1    1,667.6    1,311.9    1,095.0      797.1      788.5
- ------------------------------------------------------------------------------------------------------------
ADJUSTED GROSS INCOME AFTER PROVISION         2,171.1    2,386.7    1,975.3    1,690.7    1,330.5    1,322.8
- ------------------------------------------------------------------------------------------------------------
NONINTEREST EXPENSE:
Employee compensation, incentives and
benefits                                        915.0      995.6      830.6      670.9      508.3      488.7
Occupancy                                        89.4       83.6       76.7       69.1       80.5       73.1
Equipment rentals, depreciation and
maintenance                                      72.7       69.0       68.7       74.1       68.2       57.8
Operations services                              67.5       67.9       60.2       59.6       70.9       64.6
Communications and courier                       49.6       50.5       45.1       42.2       41.9       45.3
Amortization of intangible assets                 9.5        8.0        6.2       10.8       11.7       10.5
All other expense                               300.6      393.1      329.7      275.4      212.0      203.4
- ------------------------------------------------------------------------------------------------------------
  Total noninterest expense                   1,504.3    1,667.7    1,417.2    1,202.1      993.5      943.4
- ------------------------------------------------------------------------------------------------------------
INCOME BEFORE INCOME TAXES                      666.8      719.0      558.1      488.6      337.0      379.4
Provision for income taxes                      212.4      245.7      181.6      162.2      104.4      131.9
- ------------------------------------------------------------------------------------------------------------
INCOME BEFORE CUMULATIVE EFFECT OF CHANGES
 IN ACCOUNTING PRINCIPLES                       454.4      473.3      376.5      326.4      232.6      247.5
Cumulative effect of changes in accounting
 principles, net of tax                             -          -          -       (8.2)         -          -
- ------------------------------------------------------------------------------------------------------------
NET INCOME                                   $  454.4   $  473.3   $  376.5   $  318.2   $  232.6   $  247.5
============================================================================================================
FULLY TAXABLE EQUIVALENT ADJUSTMENT          $    1.1   $    1.3   $    1.5   $    2.1   $    2.6   $    3.0
- ------------------------------------------------------------------------------------------------------------
 EARNINGS PER COMMON SHARE BEFORE
  CUMULATIVE EFFECT OF CHANGES IN
  ACCOUNTING PRINCIPLES                      $   3.64   $   3.73   $   2.97   $   2.55   $   1.79   $   1.90
- ------------------------------------------------------------------------------------------------------------
EARNINGS PER COMMON SHARE                    $   3.64   $   3.73   $   2.97   $   2.49   $   1.79   $   1.90
- ------------------------------------------------------------------------------------------------------------
DILUTED EARNINGS PER COMMON SHARE BEFORE
 CUMULATIVE EFFECT OF CHANGES IN ACCOUNTING
 PRINCIPLES                                  $   3.54   $   3.62   $   2.89   $   2.48   $   1.77   $   1.85
- ------------------------------------------------------------------------------------------------------------
DILUTED EARNINGS PER COMMON SHARE            $   3.54   $   3.62   $   2.89   $   2.42   $   1.77   $   1.85
- ------------------------------------------------------------------------------------------------------------


<Caption>
- --------------------------------------------------------------------------------
                                                      Growth Rates (%)
                                             -----------------------------------
(Dollars in millions except per share data)       04/03              04/99*
- --------------------------------------------------------------------------------
<S>                                          <C>                <C>
INTEREST INCOME:
Interest and fees on loans                         17.8 +               .6 +
Investment securities                               6.3 -             10.2 -
Loans held for sale                                 1.0 -               .4 -
Trading securities inventory                        5.7 +             11.2 +
Other earning assets                               54.0 +             11.8 -
- -------------------------------------------
  Total interest income                            10.8 +               .7 -
- -------------------------------------------
INTEREST EXPENSE:
Deposits:
 Savings                                           50.0 -             41.4 -
 Checking interest and money market                 5.3 +             25.5 -
 Certificates of deposit under $100,000 and
  other time                                        5.1 +             13.5 -
 Certificates of deposit $100,000 and more         55.8 +              8.2 -
Short-term borrowings                               9.0 +             18.9 -
Term borrowings                                    42.1 +             15.2 +
- -------------------------------------------
  Total interest expense                           25.4 +             12.9 -
- -------------------------------------------
NET INTEREST INCOME                                 6.3 +              7.7 +
Provision for loan losses                          44.3 -              3.4 -
- -------------------------------------------
NET INTEREST INCOME AFTER PROVISION                12.4 +              8.6 +
- -------------------------------------------
NONINTEREST INCOME:
Mortgage banking                                   31.5 -              8.3 +
Capital markets                                    30.1 -             24.3 +
Deposit transactions and cash management            1.2 +              6.9 +
Merchant processing                                30.3 +              8.6 +
Insurance commissions                               2.9 -             38.7 +
Trust services and investment management            3.1 +              4.6 -
Gains on divestitures                                NM                 NM
Equity securities gains/(losses), net                NM                 NM
Debt securities gains/(losses), net                  NM                 NM
All other income                                   27.9 +              7.5 +
- -------------------------------------------
  Total noninterest income                         18.3 -             11.6 +
- -------------------------------------------
ADJUSTED GROSS INCOME AFTER PROVISION               9.0 -             10.4 +
- -------------------------------------------
NONINTEREST EXPENSE:
Employee compensation, incentives and
benefits                                            8.1 -             13.4 +
Occupancy                                           7.0 +              4.1 +
Equipment rentals, depreciation and
maintenance                                         5.4 +              4.7 +
Operations services                                  .6 -               .9 +
Communications and courier                          1.9 -              1.8 +
Amortization of intangible assets                  19.6 +              1.9 -
All other expense                                  23.5 -              8.1 +
- -------------------------------------------
  Total noninterest expense                         9.8 -              9.8 +
- -------------------------------------------
INCOME BEFORE INCOME TAXES                          7.3 -             11.9 +
Provision for income taxes                         13.6 -             10.0 +
- -------------------------------------------
INCOME BEFORE CUMULATIVE EFFECT OF CHANGES
 IN ACCOUNTING PRINCIPLES                           4.0 -             12.9 +
Cumulative effect of changes in accounting
 principles, net of tax                               -                  -
- -------------------------------------------
NET INCOME                                          4.0 -             12.9 +
===========================================
FULLY TAXABLE EQUIVALENT ADJUSTMENT                15.4 -             18.2 -
- -------------------------------------------
 EARNINGS PER COMMON SHARE BEFORE
  CUMULATIVE EFFECT OF CHANGES IN
  ACCOUNTING PRINCIPLES                             2.4 -             13.9 +
- -------------------------------------------
EARNINGS PER COMMON SHARE                           2.4 -             13.9 +
- -------------------------------------------
DILUTED EARNINGS PER COMMON SHARE BEFORE
 CUMULATIVE EFFECT OF CHANGES IN ACCOUNTING
 PRINCIPLES                                         2.2 -             13.9 +
- -------------------------------------------
DILUTED EARNINGS PER COMMON SHARE                   2.2 -             13.9 +
- -------------------------------------------
</Table>

* Compound annual growth rate.
Certain previously reported amounts have been reclassified to agree with current
presentation.
NM - Due to the variable nature of these items the growth rate is considered to
be not meaningful.

                                      114     First Horizon National Corporation




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-21
<SEQUENCE>16
<FILENAME>ex21.txt
<DESCRIPTION>EXHIBIT 21
<TEXT>


<PAGE>




                                                                      Exhibit 21


                            PARENTS AND SUBSIDIARIES

         The following is a list of all subsidiaries of First Horizon National
Corporation ("FHNC") and information on unconsolidated entities at December 31,
2004. Each subsidiary is 100% owned by its immediate parent, except as described
below in note (3), and all are included in the Consolidated Financial
Statements:


<TABLE>
<CAPTION>
                                                                         Type of               Jurisdiction of
                                                                         Ownership             Incorporation/
         Subsidiary                                                      by FHNC               Organization
         ----------                                                      ----------            ---------------
<S>                                                                      <C>                   <C>
First National Bank of Springdale*                                         Direct              United States

First Tennessee Bank National Association (1)                              Direct              United States
     Check Consultants, Incorporated*                                      Indirect            Tennessee
     Community Leasing Corporation*                                        Indirect            Tennessee
     Community Money Center, Inc.*                                         Indirect            Tennessee
     East Tennessee Service Corporation*                                   Indirect            Tennessee
         Upper East Tennessee Insurance Agency*                            Indirect            Tennessee
     First Express Remittance Processing, Inc.                             Indirect            Tennessee
     First Funds, Inc.*                                                    Indirect            Tennessee
     First Horizon Insurance Services, Inc.                                Indirect            Tennessee
     First Horizon Merchant Services, Inc.                                 Indirect            Tennessee
         Global Card Services, Inc.                                        Indirect            Florida
     First Horizon Mint Distribution, Inc.                                 Indirect            Tennessee
     First Horizon Money Center, Inc.*                                     Indirect            Tennessee
     First Tennessee ABS, Inc.*                                            Indirect            Delaware
     First Tennessee Brokerage, Inc.                                       Indirect            Tennessee
     First Tennessee Commercial Loan Management, Inc.*                     Indirect            Tennessee
     First Tennessee Equipment Finance Corporation                         Indirect            Tennessee
     First Tennessee Housing Corporation                                   Indirect            Tennessee
         CC Community Development Holdings, Inc.                           Indirect            Tennessee
     First Tennessee Insurance Services, Inc.                              Indirect            Tennessee
     First Tennessee Merchant Equipment, Inc.*                             Indirect            Tennessee
     FT Building, LLC                                                      Indirect            Tennessee
     FT Insurance Corporation                                              Indirect            Alabama
     FT Mortgage Holding Corporation                                       Indirect            Delaware
         Federal Flood Certification Corporation                           Indirect            Texas
         FHEL, Inc.                                                        Indirect            Delaware
              FHRF, Inc.                                                   Indirect            Delaware
                  First Horizon Mortgage Loan Corporation                  Indirect            Delaware
                      FT Real Estate Securities Company, Inc.              Indirect            Arkansas
                           FHRIII, LLC                                     Indirect            Delaware
                           FHTRS, Inc.                                     Indirect            Delaware
                               FH-FF Mortgage Services, L.P.               Indirect            Delaware
         FHR Holding, Inc.                                                 Indirect            Delaware
              FHRIV, LLC                                                   Indirect            Delaware
              FHRV, LLC                                                    Indirect            Delaware
</TABLE>



                                     1

<PAGE>



<TABLE>
<S>                                                                      <C>                   <C>
              FHRVI, LLC                                                   Indirect            Delaware
         First Horizon Home Loan Corporation (3)                           Indirect            Kansas
              First Tennessee Mortgage Services, Inc.                      Indirect            Tennessee
              First Horizon Asset Securities, Inc.                         Indirect            Delaware
         FT Real Estate Information Mortgage Solutions Holdings, Inc.      Indirect            Delaware
              FT Real Estate Information Mortgage Solutions, Inc.          Indirect            Delaware
                  Total Mortgage Solutions, LP                             Indirect            Delaware
         FT Reinsurance Company                                            Indirect            South Carolina
     FTN Financial Capital Assets Corporation                              Indirect            Tennessee
     FTN Financial Securities Corp.                                        Indirect            Tennessee
     FTN Financial Securitization Corporation                              Indirect            Delaware
     FTN Investment Corp.                                                  Indirect            Delaware
     FTN Midwest Securities Corp.                                          Indirect            Delaware
     FTN Premium Services, Inc.                                            Indirect            Tennessee
     Hickory Venture Capital Corporation                                   Indirect            Alabama
     JPO, Inc.                                                             Indirect            Tennessee
     JV Mortgage Solutions LLC                                             Indirect            Delaware
     Synaxis Group, Inc.                                                   Indirect            Delaware
         SFSR, Inc.                                                        Indirect            Tennessee
         Employers Risk Services, Inc.                                     Indirect            Kentucky
         Mann, Smith and Cummings, Inc.*                                   Indirect            Tennessee
         Merritt & McKenzie, Inc.                                          Indirect            Georgia
         Polk & Sullivan Group, Inc.                                       Indirect            Tennessee
         Synaxis Risk Services, Inc.                                       Indirect            Tennessee
         Van Meter Insurance, Inc.                                         Indirect            Kentucky
     TSMM Corporation*                                                     Indirect            Tennessee

FTB Futures Corporation*                                                   Direct              Tennessee
FT Title Reinsurance Company, Inc.                                         Direct              South Carolina
Hickory Capital Corporation                                                Direct              Tennessee
Highland Capital Management Corp.                                          Direct              Tennessee
Martin & Company, Inc.                                                     Direct              Tennessee
Mountain Financial Company*                                                Direct              Tennessee
Norlen Life Insurance Company                                              Direct              Arizona
</TABLE>

   *Inactive.


(1)  Divisions of this subsidiary do business in certain jurisdictions under the
     following names: First Express, First Horizon, First Horizon Bank, First
     Horizon Equity Lending, First Horizon Money Center, FTN Financial Capital
     Markets, Garland Trust, Gulf Pacific Mortgage.

(2)  Divisions of this subsidiary do business in certain jurisdictions under the
     following names: First Horizon Home Loans, First Horizon Lending Center,
     McGuire Mortgage, OneLoan.

(3)  The following subsidiaries are not wholly-owned by their immediate parent:

            FT Mortgage Holding Corporation - FHNC owns <1% of the common
                  stock with the balance owned by the subsidiary's immediate
                  parent.


                                        2


<PAGE>

            FT Real Estate Securities Company, Inc. - FHNC owns <1% of the
                  common stock with the balance of the common stock owned by the
                  subsidiary's immediate parent. Some preferred stock is not
                  owned directly or indirectly by FHNC.

            First Horizon Mortgage Loan Corporation - FHNC owns <1% of the
                  common stock directly with the balance of the common stock
                  owned by the subsidiary's immediate parent.

            First Tennessee Mortgage Services, Inc. - FHNC owns <2% of the
                  common stock directly with the balance of the common stock
                  owned by the subsidiary's immediate parent.

            FH-FF Mortgage Services, L.P. - FHTRS, Inc. owns a 99% limited
                  partnership interest and First Tennessee Mortgage Services,
                  Inc. owns a 1% general partnership interest.

            FHRF, Inc. - First Tennessee Mortgage Services, Inc. owns 1.01% of
                  the common stock with the balance owned by the subsidiary's
                  immediate parent.

            JV    Mortgage Solutions, LLC - First Tennessee Bank National
                  Association owns 50%.

            Total Mortgage Solutions, LP - FT Real Estate Information Mortgage
                  Solutions, Inc. owns 49.5% and JV Mortgage Solutions, LLC owns
                  1%.


In addition, FHNC owns 100% of the common securities of the following
unconsolidated entities:

         First Tennessee Capital I, a Delaware business trust.

         First Tennessee Capital II, a Delaware business trust.


                                        3

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23
<SEQUENCE>17
<FILENAME>ex23.txt
<DESCRIPTION>EXHIBIT 23
<TEXT>


<PAGE>

                                                                    Exhibit 23

            Consent of Independent Registered Public Accounting Firm

The Board of Directors
First Horizon National Corporation:

We consent to the incorporation by reference into the previously filed
registration statements Nos. 33-9846, 33-40398, 33-44142, 33-52561, 33-57241,
33-63809, 33-64471, 333-16225, 333-16227, 333-17457, 333-17457-01, 333-17457-02,
333-17457-03, 333-17457-04, 333-70075, 333-91137, 333-92145, 333-92147,
333-56052, 333-73440, 333-73442, 333-106015, 333-108738, 333-108750, 333-109862,
and 333-110845 of First Horizon National Corporation (the Company) of our
reports dated March 11, 2005, with respect to the Company's consolidated
statements of condition as of December 31, 2004 and 2003, and the related
consolidated statements of income, shareholders' equity, and cash flows for
each of the years in the three-year period ended December 31, 2004, management's
assessment of the effectiveness of internal control over financial reporting
as of December 31, 2004, and the effectiveness of internal control over
financial reporting as of December 31, 2004, which reports are incorporated by
reference into the Company's 2004 Annual Report on Form 10-K, and to all
references to our firm included therein.



/s/ KPMG LLP
Memphis, Tennessee
March 11, 2005



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-24
<SEQUENCE>18
<FILENAME>ex24.txt
<DESCRIPTION>EXHIBIT 24
<TEXT>


<PAGE>



                                                                      EXHIBIT 24

                                POWER OF ATTORNEY

         KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below does hereby constitute and appoint MARLIN L. MOSBY, III, JAMES F.
KEEN, CLYDE A. BILLINGS, JR., and MILTON A. GUTELIUS, JR., jointly and each of
them severally, his or her true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution, for him or her and in his or her name,
place and stead, in any and all capacities, to execute and sign the Annual
Report on Form 10-K for the fiscal year ended December 31, 2004 to be filed with
the Securities and Exchange Commission, pursuant to the provisions of the
Securities Exchange Act of 1934, by First Horizon National Corporation
("Corporation") and, further, to execute and sign any and all amendments thereto
and to file the same, with all exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, or their or his or her
substitute or substitutes, full power and authority to do and perform each and
every act and thing requisite or necessary to be done in and about the premises,
as fully to all intents and purposes as the undersigned might or could do in
person, hereby ratifying and confirming all the acts that said attorneys-in-fact
and agents, or any of them, or their or his or her substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.



<TABLE>
<CAPTION>
         Signature                                     Title                                 Date
         ---------                                     -----                                 ----
<S>                                   <C>                                              <C>
/s/ J. Kenneth Glass                   Chairman of the Board, President and             March 4, 2005
- ----------------------------           Chief Executive Officer and a Director
J. Kenneth Glass                       (principal executive officer)


/s/ Marlin L. Mosby, III               Executive Vice President and Chief               March 4, 2005
- ----------------------------           Financial Officer (principal financial
Marlin L. Mosby, III                   officer)


/s/ James F. Keen                      Executive Vice President and Corporate           March 4, 2005
- ----------------------------           Controller (principal accounting officer)
James F. Keen


/s/ Robert C. Blattberg                Director                                         March 4, 2005
- ----------------------------
Robert C. Blattberg


- ----------------------------           Director
George E. Cates
</TABLE>


                                       1




<PAGE>



<TABLE>
<S>                                   <C>                                              <C>
/s/ Simon F. Cooper                    Director                                         March 4, 2005
- ----------------------------
Simon F. Cooper


/s/ James A. Haslam, III               Director                                         March 4, 2005
- ----------------------------
James A. Haslam, III


/s/ R. Brad Martin                     Director                                         March 4, 2005
- ----------------------------
R. Brad Martin


/s/ Vicki R. Palmer                    Director                                         March 4, 2005
- ----------------------------
Vicki R. Palmer


/s/ Michael D. Rose                    Director                                         March 4, 2005
- ----------------------------
Michael D. Rose


/s/ Mary F. Sammons                    Director                                         March 4, 2005
- ----------------------------
Mary F. Sammons


/s/ William B. Sansom                  Director                                         March 4, 2005
- ----------------------------
William B. Sansom


/s/ Jonathon P. Ward                   Director                                         March 4, 2005
- ----------------------------
Jonathan P. Ward


/s/ Luke Yancy III                     Director                                         March 4, 2005
- ----------------------------
Luke Yancy III
</TABLE>


                                       2


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>19
<FILENAME>ex31a.txt
<DESCRIPTION>EXHIBIT 31(A)
<TEXT>


<Page>


                                                                   Exhibit 31(a)

                       FIRST HORIZON NATIONAL CORPORATION
                     RULE 13a - 14(a) CERTIFICATIONS OF CEO
            Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
                                 (ANNUAL REPORT)

                                 CERTIFICATIONS

I, J. Kenneth Glass, Chairman of the Board, President and Chief Executive
Officer of First Horizon National Corporation, certify that:

1.     I have reviewed this annual report on Form 10-K of First Horizon National
       Corporation;

2.     Based on my knowledge, this report does not contain any untrue statement
       of a material fact or omit to state a material fact necessary to make the
       statements made, in light of the circumstances under which such
       statements were made, not misleading with respect to the period covered
       by this report;

3.     Based on my knowledge, the financial statements, and other financial
       information included in this report, fairly present in all material
       respects the financial condition, results of operations and cash flows of
       the registrant as of, and for, the periods presented in this report;

4.     The registrant's other certifying officer and I are responsible for
       establishing and maintaining disclosure controls and procedures (as
       defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
       control over financial reporting (as defined in Exchange Act Rules
       13a-15(f) and 15d-15(f)) for the registrant and have:

       a)     Designed such disclosure controls and procedures, or caused such
              disclosure controls and procedures to be designed under our
              supervision, to ensure that material information relating to the
              registrant, including its consolidated subsidiaries, is made known
              to us by others within those entities, particularly during the
              period in which this report is being prepared;

       b)     Designed such internal control over financial reporting, or caused
              such internal control over financial reporting to be designed
              under our supervision, to provide reasonable assurance regarding
              the reliability of financial reporting and the preparation of
              financial statements for external purposes in accordance with
              generally accepted accounting principles;

       c)     Evaluated the effectiveness of the registrant's disclosure
              controls and procedures and presented in this report our
              conclusions about the effectiveness of the disclosure controls and
              procedures, as of the end of the period covered by this report
              based on such evaluation; and

       d)     Disclosed in this report any change in the registrant's internal
              control over financial reporting that occurred during the
              registrant's most recent fiscal quarter (the registrant's fourth
              fiscal quarter in the case of an annual report) that has
              materially affected, or is reasonably likely to materially affect,
              the registrant's internal control over financial reporting; and

5.     The registrant's other certifying officer and I have disclosed, based on
       our most recent evaluation of internal control over financial reporting,
       to the registrant's auditors and the audit committee of the registrant's
       board of directors (or persons performing the equivalent functions):

       a)     All significant deficiencies and material weaknesses in the design
              or operation of internal control over financial reporting which
              are reasonably likely to adversely affect the registrant's ability
              to record, process, summarize and report financial information;
              and

       b)     Any fraud, whether or not material, that involves management or
              other employees who have a significant role in the registrant's
              internal control over financial reporting.

Date     March 11, 2005

/s/ J. Kenneth Glass
- ------------------------------
J. Kenneth Glass
Chairman of the Board, President and Chief Executive Officer
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>20
<FILENAME>ex31b.txt
<DESCRIPTION>EXHIBIT 31(B)
<TEXT>


<Page>



                                                                  Exhibit 31(b)

                       FIRST HORIZON NATIONAL CORPORATION
                     RULE 13a - 14(a) CERTIFICATIONS OF CFO
            Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
                                 (ANNUAL REPORT)

                                 CERTIFICATIONS

I, Marlin L. Mosby, Executive Vice President and Chief Financial Officer of
First Horizon National Corporation, certify that:

1.     I have reviewed this annual report on Form 10-K of First Horizon National
       Corporation;

2.     Based on my knowledge, this report does not contain any untrue statement
       of a material fact or omit to state a material fact necessary to make the
       statements made, in light of the circumstances under which such
       statements were made, not misleading with respect to the period covered
       by this report;

3.     Based on my knowledge, the financial statements, and other financial
       information included in this report, fairly present in all material
       respects the financial condition, results of operations and cash flows of
       the registrant as of, and for, the periods presented in this report;

4.     The registrant's other certifying officer and I are responsible for
       establishing and maintaining disclosure controls and procedures (as
       defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
       control over financial reporting (as defined in Exchange Act Rules
       13a-15(f) and 15d-15(f)) for the registrant and have:

       a)     Designed such disclosure controls and procedures, or caused such
              disclosure controls and procedures to be designed under our
              supervision, to ensure that material information relating to the
              registrant, including its consolidated subsidiaries, is made known
              to us by others within those entities, particularly during the
              period in which this report is being prepared;

       b)     Designed such internal control over financial reporting, or caused
              such internal control over financial reporting to be designed
              under our supervision, to provide reasonable assurance regarding
              the reliability of financial reporting and the preparation of
              financial statements for external purposes in accordance with
              generally accepted accounting principles;

       c)     Evaluated the effectiveness of the registrant's disclosure
              controls and procedures and presented in this report our
              conclusions about the effectiveness of the disclosure controls and
              procedures, as of the end of the period covered by this report
              based on such evaluation; and

       d)     Disclosed in this report any change in the registrant's internal
              control over financial reporting that occurred during the
              registrant's most recent fiscal quarter (the registrant's fourth
              fiscal quarter in the case of an annual report) that has
              materially affected, or is reasonably likely to materially affect,
              the registrant's internal control over financial reporting; and

5.     The registrant's other certifying officer and I have disclosed, based on
       our most recent evaluation of internal control over financial reporting,
       to the registrant's auditors and the audit committee of the registrant's
       board of directors (or persons performing the equivalent functions):

       a)     All significant deficiencies and material weaknesses in the design
              or operation of internal control over financial reporting which
              are reasonably likely to adversely affect the registrant's ability
              to record, process, summarize and report financial information;
              and

       b)     Any fraud, whether or not material, that involves management or
              other employees who have a significant role in the registrant's
              internal control over financial reporting.

Date     March 11, 2005

/s/ Marlin L. Mosby III
- -------------------------------------------
Marlin L. Mosby III
Executive Vice President and Chief Financial Officer

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>21
<FILENAME>ex32a.txt
<DESCRIPTION>EXHIBIT 32(A)
<TEXT>



<Page>



                                                                   Exhibit 32(a)

                        CERTIFICATION OF PERIODIC REPORT
                         RULE 1350 CERTIFICATIONS OF CEO
           Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
                      As Codefied at 18 U.S.C. Section 1350


I, the undersigned J. Kenneth Glass, President and Chief Executive Officer of
First Horizon National Corporation ("Corporation"), hereby certify, pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, as
follows:

1.       The Corporation's Annual Report on Form 10-K for the year ended
         December 31, 2004 (the "Report") fully complies with the requirements
         of Section 13(a) or 15(d) of the Securities Exchange Act of 1934.

2.       The information contained in the Report fairly presents, in all
         material respects, the financial condition and results of operations of
         the Corporation.


Dated:  March 11, 2005



                                        /s/ J. Kenneth Glass
                                        -------------------------------------
                                        J. Kenneth Glass
                                        Chairman of the Board, President
                                        and Chief Executive Officer


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>22
<FILENAME>ex32b.txt
<DESCRIPTION>EXHIBIT 32(B)
<TEXT>



<Page>




                                                                   Exhibit 32(b)

                        CERTIFICATION OF PERIODIC REPORT
                         RULE 1350 CERTIFICATIONS OF CFO
           Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
                      As Codefied at 18 U.S.C. Section 1350


I, the undersigned Marlin L. Mosby, Executive Vice President and Chief Financial
Officer of First Horizon National Corporation ("Corporation"), hereby certify,
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section
1350, as follows:

1.       The Corporation's Annual Report on Form 10-K for the year ended
         December 31, 2004 (the "Report") fully complies with the requirements
         of Section 13(a) or 15(d) of the Securities Exchange Act of 1934.

2.       The information contained in the Report fairly presents, in all
         material respects, the financial condition and results of operations of
         the Corporation.


Dated: March 11, 2005



                                        /s/ Marlin L. Mosby III
                                        ---------------------------------------
                                        Marlin L. Mosby III
                                        Executive Vice President and Chief
                                        Financial Officer


</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
