FHN-PF — First Horizon Corporation

Summary of First Horizon Corporation (FHN-PF) Q1 2026 Earnings Call

1. Key Financial Results and Metrics

• Earnings Per Share (EPS): $0.53, up $0.11 year-over-year.
• Return on Average Assets (ROAA): 1.3%, an increase of 19 basis points from Q1 2025.
• Adjusted Return on Tangible Common Equity (ROTCE): 15.1%, up over 200 basis points year-over-year.
• Net Interest Income (NII): Grew 6% year-over-year, outpacing loan portfolio growth of 3%.
• Adjusted Pre-Provision Net Revenue: Improved by 8% compared to 2025.
• Common Equity Tier 1 (CET1) Ratio: 10.53%, with a Tier 1 capital ratio of 11.95%.
• Tangible Book Value per Share: $14.34, a 9% increase year-over-year.
• Net Charge-Offs: $29 million, with a net charge-off ratio of 18 basis points.

2. Strategic Updates and Business Highlights

• Continued focus on relationship banking, with strong growth in Commercial & Industrial (C&I) loans, which increased by $624 million in the quarter.
• Efforts to improve profitability through a diversified business model and disciplined pricing strategies.
• Successful buyback of approximately $230 million in common shares and issuance of $400 million in Series H preferred stock.
• Notable growth in the C&I portfolio and strong pipelines in both C&I and Commercial Real Estate (CRE).
• Emphasis on enhancing client relationships and expanding treasury and wealth management services.

3. Forward Guidance and Outlook

• Maintained full-year revenue growth expectations of 3% to 7%.
• Updated near-term CET1 target to 10.5%.
• Anticipated seasonal increases in loans to mortgage companies in Q2, though overall mortgage origination remains uncertain.
• Optimistic about continued C&I demand and strong CRE pipelines, with expectations for loan growth to remain robust throughout the year.

4. Challenges and Points of Concern

• Deposit Competition: Increased competition for deposits noted, with expectations of rising deposit costs in Q2 and Q3.
• Consumer Loan Portfolio: Experienced a decline of $198 million, attributed to normal fluctuations.
• Commercial Real Estate (CRE): Continues to face headwinds, with stabilized loans moving to permanent markets and a cautious outlook due to market conditions.
• Economic Uncertainty: Concerns about macroeconomic factors, including geopolitical tensions and their potential impact on consumer discretionary spending.

5. Notable Q&A Insights

• Lending Environment: CEO D. Bryan Jordan expressed optimism about C&I pipelines, noting that macro uncertainties have not significantly impacted lending activity.
• Mortgage Warehouse Lending: CFO Hope Dmuchowski indicated expectations for a seasonal increase in warehouse balances, despite a challenging mortgage origination environment.
• Credit Quality: Chief Credit Officer Thomas Hung highlighted stable credit performance but noted vigilance regarding sectors sensitive to consumer spending.
• Expense Management: Hope Dmuchowski confirmed a flat expense outlook, emphasizing that new hires and strategic investments are accounted for without increasing overall expenses.
• M&A Stance: D. Bryan Jordan reiterated a focus on core profitability, with opportunistic evaluation of potential acquisitions but no immediate plans.

This summary encapsulates the key points from the earnings call, highlighting both the positive performance metrics and the challenges faced by First Horizon Corporation in Q1 2026.