D. Bryan Jordan is putting his stamp on First Horizon National Corp. as he prepares to take over as chief executive next month.
This week Mr. Jordan, who is currently the Memphis company's chief financial officer, outlined one major change and gave employees an update on executive staffing.
In an internal memo dated Tuesday, Mr. Jordan said First Horizon has formed a 13-member executive committee that will meet weekly and "ensure that we quickly and proactively execute on our strategies and tackle emerging issues."
He also discussed how the company will fill several senior roles, including picking his successor as CFO and a president for the FTN Financial capital markets unit. Mark Medford, who had held the latter post, resigned Tuesday to become the president and CEO of Vining-Sparks IBG LP, a Memphis investment firm.
Mr. Jordan, a former Regions Financial Corp. executive, joined the $35.5 billion-asset company a little more than a year ago and is due to succeed CEO Gerald L. Baker Sept. 1.
The formation of the executive committee will coincide with Mr. Jordan's assumption of the CEO role. First Horizon's banking, capital-markets, finance, legal, credit, risk, technology, human resources and communications units will all be represented, according to the memo.
A spokeswoman said the company had previously not used an executive committee structure. Instead, smaller groups of senior managers would meet several times a month, she said. She also said that Mr. Jordan was in meetings this week and unavailable to give an interview.
Mr. Jordan is poised to take over a company that has gone through a lengthy identity crisis, one that left it significantly smaller. Last year it pulled back from a plan to expand its retail bank nationally by converting mortgage offices in big cities. Then, facing mounting losses in its mortgage portfolio, it agreed to sell its national mortgage business to MetLife Inc. in a deal that is to close Aug. 31.
In a regulatory filing Tuesday, First Horizon said it is on schedule with an effort to shrink its balance sheet and preserve capital, including a plan to shed about $4 billion of loans by yearend.
And in Tuesday's memo, Mr. Jordan wrote that, while he seeks someone to succeed him as CFO, Thomas Adams, First Horizon's treasurer, would be the interim CFO. Mr. Jordan wrote that he is considering both internal and external candidates.
Meanwhile, Frank Gusmus, a former FTN Financial chief financial officer, was tapped to be the unit's interim president. Mr. Jordan wrote that he would prefer to fill that post internally. "We have some hard work to do, but we have great people throughout the organization doing the right thing for our customers every day," he wrote.
However, Mr. Jordan's memo made no mention of Sarah L. Meyerrose, who on July 31 resigned as the company's president of emerging national businesses after about two years in the post. First Horizon said in a regulatory filing that her post had been eliminated as part of continuing efforts to exit national businesses such as mortgage origination, small-business lending, and consumer lending.
In a statement e-mailed to American Banker, Mr. Baker wrote: "It has been necessary to evaluate and reduce management at all levels, including the executive suite. We have in this process lost talented people, but it is consistent with the view of our strategic direction."
The turnaround period has been difficult for First Horizon, which lost $19 million, or 11 cents a share, in the second quarter. The company has reported losses in three of its previous four quarters, forcing it to save capital by selling $690 million of common stock and replacing its cash dividend with a common stock equivalent. It has cut more than 2,000 jobs since June 2007.
Frank Barkocy, the director of research at Mendon Capital Advisors LLC, said the departures give Mr. Jordan an immediate chance to build his own management team, mirroring similar moves at Wachovia Corp. in Charlotte, which is looking to hire a chief financial officer and chief risk officer. "A new CEO will always want to get the people in place who have the capabilities to carry things forward," he said in an interview Wednesday.
Albert Savastano, an analyst at Fox-Pitt Kelton Cochran Caronia Waller, said in an interview Wednesday that a need exists to fill the CFO post quickly. However, he said, First Horizon's strategic shift seems to be proceeding as planned. "We do need to see improvement on the credit side," he said. "The earnings aren't that important right now, but of course that may change in another year."
However, observers also said that First Horizon's difficulties in past quarters could make it difficult to fill key posts. One executive recruiter, who asked not to be named, said he is watching to see how quickly the company addresses the vacancies as a gauge for whether it might look to sell itself. "It is more attractive to scoop you up when you're naked at the executive level," he said.
Mr. Baker's statement did not address independence, but the company has said several times that it has no plan to shop itself.
Observers said Mr. Jordan could still look outside the company to fill the capital markets vacancy. Another executive recruiter, who requested anonymity, mentioned G. Douglas Edwards, a former president and chief executive of Regions Financial Corp.'s Morgan Keegan & Co. Inc., as a possible candidate.
Reached for comment Thursday, Mr. Edwards wouldn't comment on his interest. "It would be up to Bryan to determine if I would be a good fit. But I also understand that they are looking to fill the position internally," he said.
Said Mr. Barkocy: "I wouldn't discount any option because you always feel more comfortable when you are surrounded with people you know." However, he added, "I don't get the sense there is a for-sale sign on the door."
