FHN-PE — First Horizon Corporation

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

1. Key Financial Results and Metrics:

• Earnings Per Share (EPS): $0.53, up $0.11 YoY.
• Return on Average Assets (ROAA): 1.3%, an increase of 19 basis points YoY.
• Adjusted Return on Tangible Common Equity (ROTCE): 15.1%, up over 200 basis points YoY.
• Net Interest Income (NII): Grew 6% YoY, outpacing loan growth of 3%.
• Adjusted Pre-Provision Net Revenue (PPNR): Increased by 8% YoY.
• Common Equity Tier 1 (CET1) Ratio: 10.53%, with a target updated to 10.5%.
• Tangible Book Value per Share: $14.34, up 9% YoY.
• Net Charge-Offs: $29 million, with a net charge-off ratio of 18 basis points.

2. Strategic Updates and Business Highlights:

• Continued focus on building client relationships and providing tailored solutions.
• Strong growth in the Commercial & Industrial (C&I) loan portfolio, with $624 million growth in Q1.
• Diversified business model with countercyclical strengths positioned well for evolving market conditions.
• Successful issuance of $400 million in Series H preferred stock, contributing to capital ratios.
• Ongoing investments in technology and talent to enhance operational effectiveness.

3. Forward Guidance and Outlook:

• Full-year revenue growth guidance remains at 3% to 7%, with expectations for mid-single-digit loan growth.
• Anticipation of a seasonal increase in mortgage warehouse balances in Q2.
• Continued optimism regarding C&I pipelines, with expectations for strong lending growth throughout the year.
• The company aims for over $100 million in incremental PPNR, focusing on deepening client relationships and enhancing fee income.

4. Bad News, Challenges, or Points of Concern:

• Deposit Competition: Increased competition for deposits noted, with expectations for slight upward pressure on deposit costs in Q2 and Q3.
• Commercial Real Estate (CRE): Ongoing headwinds in CRE loan growth, though strong pipelines are expected to stabilize balances later in the year.
• Consumer Loan Portfolio: Experienced a decline of $198 million, aligned with typical seasonal fluctuations.
• Market Volatility: Concerns regarding the impact of geopolitical uncertainties and rising energy prices on discretionary consumer spending.

5. Notable Q&A Insights:

• C&I Lending Outlook: CEO D. Bryan Jordan expressed optimism about C&I pipelines, noting that macro uncertainties have not significantly impacted lending.
• Mortgage Warehouse Lending: CFO Hope Dmuchowski expects a seasonal uptick in warehouse balances, although overall mortgage origination remains low.
• Credit Quality: Chief Credit Officer Thomas Hung indicated that credit performance remains stable, with a focus on consumer discretionary sectors as potential risks.
• Expense Management: The company aims for flat year-over-year expenses, with ongoing investments in growth while controlling costs.
• M&A Strategy: The focus remains on internal profitability and core business growth, with opportunistic evaluations of potential acquisitions.

This summary encapsulates the key aspects of First Horizon Corporation's Q1 2026 earnings call, highlighting both the positive developments and the challenges faced by the company.