First Horizon Delivers Strong Q1 2025 Results Amidst Economic Uncertainty
First Horizon, a leading regional bank, has reported solid financial results for the first quarter of 2025, despite the ongoing economic uncertainty sparked by the Trump administration's efforts to address tariffs and trade imbalances.
In his opening remarks on the company's Q1 2025 earnings call, Chairman, President and CEO Bryan Jordan acknowledged that the current macroeconomic environment is marked by heightened uncertainty. However, he expressed optimism that a recession can be avoided, provided the current levels of market volatility persist for an extended period.
Underpinning First Horizon's resilience in this challenging economic landscape are its strong Southeast footprint and diversified business model. The company's disciplined approach to safety and soundness, profitability, and growth has positioned it well to navigate shifting economic expectations and market uncertainty.
The key highlights from the quarter include a solid pre-provision net revenue growth of $16 million, achieved through continued margin expansion and deposit pricing discipline. This growth enabled First Horizon to deliver an adjusted EPS of $0.42 per share, representing a modest decrease of $0.01 compared to the prior quarter.
In addition to its financial performance, First Horizon also demonstrated its ability to efficiently manage expenses, lowering them by $20 million during the first quarter. The company continued to prioritize prudent capital management through its share repurchase program, which saw it buy back $360 million of stock in Q1 2025.
One notable area of focus for the bank remains credit performance. First Horizon's charge-off ratio of 19 basis points remained in line with the strong results seen in 2024, while the company also increased its coverage ratio to reflect macroeconomic uncertainty. The bank has consistently prioritized prudent management of its portfolio to maintain an outstanding credit culture.
Chief Financial Officer Hope Dmuchowski provided a detailed overview of First Horizon's financial performance during the earnings call. Key highlights from her presentation include a $1 million increase in net interest income, driven by deposit repricing and offsetting lower loan yields. Fee income, excluding deferred compensation, declined by $5 million, while expenses decreased by $20 million.
First Horizon's Q1 2025 results demonstrate the company's commitment to delivering steady returns despite shifting economic expectations and market uncertainty. As the company continues to navigate this challenging landscape, its strong Southeast footprint and diversified business model are likely to serve it well in achieving continued growth and profitability.
