First Horizon Corporation · NYSE:FHN
First Horizon — Investor Day (June 2023)
17 slides from First Horizon's investor day presentation, Jun 6, 2023
Slide 1: PS = Purpose driven
PS = 20 Purpose driven (am) oF : = Client centered HORIZON Z Value focused —
Slide 2: Disclaimers
Disclaimers Non-GAAP Information Certain measures included in this document are “non-GAAP,” meaning they are not presented in accordance with generally accepted accounting principles in the U.S. and also are not codified in U.S. banking regulations currently applicable to FHN. Non-GAAP measures are
Slide 3: Disciplined Credit Culture
FIRST HORIZON. Disciplined Credit Culture INVESTOR DAY NON WO
Slide 4: Risk management at First Horizon
Risk management at First Horizon Prudent risk management is a priority across the organization Tone starts at the top Executive focus Risk management is everyone’s responsibility 4
Slide 5: Disciplined credit culture
Disciplined credit culture Higher quality portfolio, well positioned to continue to deliver strong results throughout the cycle ✓ Proven ability to deliver through the cycle: How we deliver these results: NCO (%) Client focus • Strong client relationships 0.42% • Trust and transparency 0.36% • Dedic
Slide 6: Strong credit quality
Strong credit quality Current credit quality is strong, as has historically been the case Non-performing loans (NPLs) Net charge-off ratio (NCO%) Allowance for credit losses (ACL)1 ($ in millions) ($ in millions) 272% $424 268% 244% $386 $316 $1,048 189% $275 $772 $800 $736 $162 0.72% 127% 0.66% 0.2
Slide 7: Diversification as a strength
Diversification as a strength Well diversified across segments, geographies, and industries Loans by category Balance 1Q23 ($ in billions) Balanced credit portfolio with <25% in CRE and CRE/Total Risk Based Capital ratio of 160%, well 23% below regulatory guidance levels ($13.4) Geographically diver
Slide 8: C&I diversification
C&I diversification C&I portfolio well diversified across industries and markets Presence in more than 20 industry sectors….. …. and geographically diverse ($ in billions) ($ in billions) Balance % of C&I Balance % of C&I Industry Sector State2 1Q23 portfolio 1Q23 portfolio Finance & Insurance $4.2
Slide 9: C&I credit quality
C&I credit quality Low net charge-offs over time and 97% of the portfolio is pass-rated Accruing past due, classified and non-accrual Net charge-offs (% of total C&I loans) ($ in millions) $120 0.36% 2.25% $53 $27 Net charge-offs $13 0.17% $12 NCO % 0.13% 1.74% 1.64% 0.04% 1.64% 0.04% 1.42% FY191 FY
Slide 10: CRE diversification
CRE diversification Well-diversified CRE portfolio in higher-growth markets CRE portfolio by property type CRE portfolio by collateral state Balance 1Q23 ($ in billions) State 1Q23 portfolio mix Florida 26% Texas 12% North Carolina 12% $13.4 Georgia 10% Tennessee 9% Louisiana 9% South Carolina 4% Al
Slide 11: CRE office portfolio by type and state
CRE office portfolio by type and state Medical Office portfolio accounts for 43% of the total office portfolio CRE office portfolio by type Distribution by collateral state1 Balance 1Q23 Non-Medical Office Medical Office ($ in billions) State $ in millions % $ in millions % $2.8 North Carolina $291
Slide 12: CRE non-medical office details
CRE non-medical office details Average loan size of $2.3 million - Loans over $5 million have a weighted LTV of 59% Total non-medical office portfolio 1Q23 Period-end loans By loan size Weighted average LTV: 59% ($ in billions) Average loan size: $2.3 million 28% 26% 25% $1.6 $0.5 Loan to 29% $1.1 v
Slide 13: CRE credit quality
CRE credit quality Low net charge-offs over time - 98% of the CRE portfolio is pass-rated Accruing past due, classified and non-accrual Net charge-offs (% of total CRE loans) ($ in millions) $1.7 0.04 $1.2 1.49% $0.7 0.01% $0.6 0.02 1.25% 0.02% Net charge-Offs 0.01% 0.00 0.00% NCO % 1.11% 1.07% -0.0
Slide 14: Consumer credit quality
Consumer credit quality Consumer credit portfolio, 94% of which is secured by real estate (RE), shows high FICOs and low LTVs Refreshed FICO® score: Loan to value (LTV): Distribution consumer & residential portfolio Distribution consumer & residential portfolio with RE collateral Balance 1Q23 Balanc
Slide 15: 2022 company-run stress test results
2022 company-run stress test results Results demonstrate strong ability to navigate the Fed CCAR Severely Adverse Scenario while maintaining capital levels well above regulatory minimums Federal Reserve CCAR severely adverse scenario Results as of August, 20221 Severe global recession with heightene
Slide 16: Positioned for continued success
Positioned for continued success Our credit culture, strong team and proven business model position us well for continued success Client- Credit relationship Teamwork Discipline culture focus 16 Average tenure of 100% Retention of Credit Credit Executives, Team Executives 1Q22 – with ~35 years of 1Q
Slide 17: Q&A Session
FIRST HORIZON. Q&A Session INVESTOR DAY NON WO