FRANKLIN FINANCIAL NETWORK, INC. (NYSE:FSB) Files An 8-K Regulation FD Disclosure
Item 7.01
As previously disclosed, on March 29, 2019, the administrative agent for a shared national credit (“SNC”) in which Franklin Financial Network, Inc. (the “Company”) is one of several lenders issued a notice of default and reservation of rights to the borrower. The SNC and defaults are more fully described in the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission (“SEC”) on April 8, 2019.
As a result of continued uncertainty as to the ultimate resolution of the cited defaults, the Company has determined that an additional specific reserve for the remaining balance of this credit relationship in the amount of approximately $6.3 million will be allocated to this SNC, meaning the full balance of the relationship has either been charged-off or is now subject to a specific reserve, and will be included in the provision for loan and lease losses during the second quarter of 2019. Additionally, due to the level of credit impairment of this relationship, the Company will recognize a charge-off of $7.5 million during the second quarter of 2019. The Company allocated the specific reserve and estimated the amount of the relationship to be charged-off based on information available to the Company at this time. The circumstances related to the SNC defaults are fluid, and the Company intends to address events as they develop. Further details on the Company’s SNC portfolio, overall credit quality and an overall update on business results will take place as a part of the planned earnings release on July 24, 2019, as well as during the planned earnings conference call on July 25, 2019.
The Company will host a live webcast on Thursday, July 25, 2019, at 8:00 a.m. CT to review its financial results, business outlook for the firm and other matters. The second quarter 2019 earnings release will be available on the Investor Relations page of Franklin Synergy Bank’s website at www.FranklinSynergyBank.com.
To access the call for audio only, please call 1-844-378-6480. For the presentation materials and streaming audio, please access the webcast on the Investor Relations page of Franklin Synergy Bank’s website at www.FranklinSynergyBank.com. For those unable to participate in the webcast, it will be archived for one calendar year following the presentation.
to the rules and regulations of the SEC, the information in this Item 7.01 disclosure is deemed to have been furnished and shall not be deemed to be “filed” under the Securities Exchange Act of 1934.
About FRANKLIN FINANCIAL NETWORK, INC. (NYSE:FSB)
Franklin Financial Network, Inc. is a financial holding company. Through its bank subsidiary, Franklin Synergy Bank (the Bank), a commercial bank, the Company provides a range of banking and related financial services. The Company focuses on the provision of services to small businesses, corporate entities, local governments and individuals. It operates through approximately 10 branches in Williamson and Rutherford counties within the Nashville metropolitan area. The Company’s loan portfolio consists of real estate loans, including construction and land development loans, commercial loans and residential loans; commercial and industrial, and consumer and other loans. The Company’s investment securities portfolio consists of both securities classified as available-for-sale and securities classified as held-to-maturity. The Company’s primary sources of funds include deposits.