First Horizon Corporation · NYSE:FHN
First Horizon — Investor Presentation (March 2025)
20 slides from First Horizon's investor presentation, March 2025
Slide 1: Economic Update March 2025
py FiRsT PENN HORIZON BANK. FINANCIAL. Economic Update March 2025
Slide 2: The only certainty is uncertainty
The only certainty is uncertainty Sophia Kearney-Lederman Senior Economist, FHN Financial
Slide 3: Strong growth coming into 2025
Strong growth coming into 2025 Real GDP w/ Atlanta Fed GDPNow 6.0% Qrt/Qtr Annualized w/ Sector Contributions 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% -1.0% -2.0% -3.0% Consumption Bus. Fixed Invest Residential Invest. Government -4.0% Inventories Net Exports Real GDP, Qtr/Qtr -5.0% Q1-22 Q2-22 Q3-22 Q4-22 Q1-
Slide 4: Growth in Q1 tracking notably slower
Growth in Q1 tracking notably slower Atlanta Fed GDPNow: Q1 '25 Unofficial gold adjusted 5.0% w/ sector contributions 4.0% 3.0% 2.0% 1.0% 0.0% -1.0% Net Exports Inventories -2.0% Government Residential Invest Bus. Fixed Invest Consumption -3.0% GDPNow -4.0% -5.0% 31-Jan 05-Feb 10-Feb 15-Feb 20-Feb 2
Slide 5: Year starts slow for consumer spending
Year starts slow for consumer spending Food & beverage stores Restaurants & bars Nominal Nominal 1.5% 10.0% 10.0% 40.0% MoM% (left) MoM% (left) YoY% (right) 7.5% 1.0% 7.5% YoY% (right) 30.0% 5.0% 0.5% 5.0% 20.0% 2.5% 0.0% 0.0% 2.5% 10.0% -2.5% -0.5% 0.0% 0.0% -5.0% -1.0% -7.5% -2.5% -10.0% 2022 2023
Slide 6: Consumer confidence has faded
Consumer confidence has faded Conference Board Consumer Confidence Index 190 Consumer Confidence Present Situation Expectations 170 150 130 110 90 70 50 2018 2019 2020 2021 2022 2023 2024 2025 6 Source: Conference Board, Macrobond, FHN Financial
Slide 7: Business sentiment reflects uncertainty
Business sentiment reflects uncertainty ISM Indices 75 ISM Indices: New Orders Contraction < 50 < Expansion Contraction < 50 < Expansion 70 70 Manufacturing Manufacturing Services 65 Services 65 60 60 55 55 50 50 45 45 40 40 35 2017 2018 2019 2020 2021 2022 2023 2024 2025 2017 2018 2019 2020 2021 20
Slide 8: Firms report higher input costs
Firms report higher input costs ISM Indices: Prices Paid ISM Indices: Employment Contraction < 50 < Expansion 100 Contraction < 50 < Expansion 65 Manufacturing 60 90 Services 55 80 50 70 45 60 40 35 50 30 40 Manufacturing Services 25 30 20 2017 2018 2019 2020 2021 2022 2023 2024 2025 2018 2019 2020
Slide 9: Hiring was volatile in '24, slow start to '25
Hiring was volatile in ’24, slow start to ‘25 Nonfarm Payrolls 600k Monthly change Government Services Goods Total 3mth Avg 12mth Avg 500k 400k 300k 200k 100k 0k Jan '23 Apr '23 Jul '23 Oct '23 Jan '24 Apr '24 Jul '24 Oct '24 Jan '25 Source: Bureau of Labor Statistics, Macrobond, FHN Financial 9
Slide 10: Unemployment rate little changed for 8 months
Unemployment rate little changed for 8 months Unemployment Rate 4.50% 4.22% 4.23% 4.40% Unemployment Rate 4.30% 3mth avg 4.20% 4.10% 4.00% 4.09% 3.90% 3.80% 3.70% 3.60% 3.67% 3.50% 3.40% 3.45% 3.30% 3.20% Jan '22 Apr '22 Jul '22 Oct '22 Jan '23 Apr '23 Jul '23 Oct '23 Jan '24 Apr '24 Jul '24 Oct '24
Slide 11: Tariff uncertainty = near-term inflation uncertainty
Tariff uncertainty = near-term inflation uncertainty Consumer Price Index 9.0% Core Consumer Price Index 0.8% MoM% (left) 8.0% 1.4% MoM%(left) 8.0% YoY% (right) 1.2% 0.7% 7.0% YoY% (right) 7.0% 0.6% 6.0% 1.0% 6.0% 0.5% 5.0% 0.8% 5.0% 0.4% 4.0% 4.0% 0.6% 0.3% 3.0% 3.0% 0.4% 0.2% 2.0% 2.0% 0.2% 1.0% 0
Slide 12: Short- and long-term inflation expectations
Short- and long-term inflation expectations Short and Long Term Inflation Expectations 7.0% NY Fed Inflation Expectations Median 1 Year Ahead 6.0% NY Fed Inflation Expectations Median 3 Year Ahead 5.0% U.S. 5yr 5yr Forward Breakeven 4.0% 3.0% 2.0% 1.0% 0.0% 2015 2016 2017 2018 2019 2020 2021 2022 20
Slide 13: Fed 2025 projection: slower growth, higher inflation
Fed 2025 projection: slower growth, higher inflation 2025 Real GDP 2025 Unemployment 2025 Core PCE 3.0% 5.0% 4.0% 4.8% 2.5% 3.5% 4.6% 4.4% 2.0% 3.0% 4.2% 1.5% 4.0% 2.5% 3.8% 1.0% 2.0% 3.6% 3.4% 0.5% 1.5% 3.2% 0.0% 3.0% 1.0% Mar '24 Jun '24 Sept '24 Dec '24 Mar '25 Mar '24 Jun '24 Sept '24 Dec '24 Ma
Slide 14: No change to median fed funds projections
No change to median fed funds projections Evolution of median participants' projections: Fed funds rate 6.0% Hundreds 5.5% Mar '24 June '24 Sept '24 Dec '24 Mar '25 5.0% 4.5% 3.9% 4.0% 3.4% 3.5% 3.1% 3.0% 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% Actual 2025 2026 2027 Longer Run Source: 14
Slide 15: However, distribution of dots did shift
However, distribution of dots did shift Fed funds projections: Dec '24 vs Mar '25 Dec '24 Mar '25 Dec '24 Mar '25 Dec '24 Mar '25 Dec '24 Mar '25 6.0% 6.0% 5.5% 5.5% 5.0% 5.0% 4.5% 4.5% 4.0% 4.0% 3.5% 3.5% 3.0% 3.0% 2.5% 2.5% 2.0% 2.0% 1.5% 1.5% 1.0% 1.0% 2025 2026 2027 Longer run Source: Federal Re
Slide 16: Market vs Fed rate cut expectations
Market vs Fed rate cut expectations FF futures implied qtr-point cuts '25 0 Market expectations v. FOMC dot plot median 1 2 Number of 25bp point cuts 3 4 5 Mkt expected cuts in '25 Median dot expected cuts '25 6 7 Jan '24 Mar '24 May '24 Jul '24 Sep '24 Nov '24 Jan '25 Mar '25 Source: Federal Reserv
Slide 17: US 10-yr yield reflects shifting concern
US 10-yr yield reflects shifting concern US 10-Yr Yield 5.00% 4.90% 4.80% 4.70% 4.60% 4.50% 4.40% 4.30% 4.20% 4.10% 4.00% 3.90% 3.80% 3.70% 3.60% 3.50% Jan '24 Feb '24 Mar '24 Apr '24 May '24 Jun '24 Jul '24 Aug '24 Sep '24 Oct '24 Nov '24 Dec '24 Jan '25 Feb '25Mar '25 Source: Bloomberg, FHN Financ
Slide 18: Key takeaways
Key takeaways • Sharp slowdown in Q1 growth likely. And Q2 uncertain, too. • Biggest difference between Trump 1.0 and Trump 2.0 is last time the good came before the bad. This time it is the other way around. • Tariff hokey-pokey is fueling growth concerns • April 2 is the next important tariff date
Slide 19: Disclaimer
Disclaimer Although this information has been obtained from sources which we believe to be reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. This is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale o
Slide 20: Thank you!
Thank you! Py rigs BY HORIZON BANK. FINANCIAL.