MEMPHIS,
Tenn., July 30, 2024 /PRNewswire/ -- First
Horizon Corporation (NYSE: FHN) ("First Horizon" or "the Company")
announced today its 2024 Company-run capital stress test results.
The 2024 test showed that, under hypothetical severe economic and
business downturns, First Horizon would maintain capital ratios
well above regulatory-required minimums. These internally generated
results, which utilized the 2024 Severely Adverse Scenario
published by the Federal Reserve on February
15, 2024, reflect continued strong risk discipline.
"Our 2024 capital stress test results in a minimum Common Equity
Tier 1 capital ratio of 9.5% which is 500 bps over the required
regulatory minimum," said Chief Financial Officer Hope Dmuchowski. "That buffer is driven by FHN's
diversified loan portfolio, countercyclical businesses, and strong
risk culture that enables the bank to support clients as well as
pursue opportunistic relationships through economic cycles."
The following table reflects the Company's starting, ending, and
minimum capital ratios under the Federal Reserve's Severely Adverse
Scenario compared to required regulatory minimums.
|
% Regulatory
Ratio
|
Actual
|
Projected Stressed
Capital Ratios
|
Regulatory Capital
Ratios
|
|
4Q23
|
Ending
|
Minimum
|
Minimum
|
|
Common equity tier 1
capital ratio
|
11.4 %
|
11.1 %
|
9.5 %
|
4.5 %
|
|
Tier 1 risk-based
capital ratio
|
12.4 %
|
12.1 %
|
10.5 %
|
6.0 %
|
|
Total risk-based
capital ratio
|
14.0 %
|
14.0 %
|
12.7 %
|
8.0 %
|
|
Tier 1 leverage
ratio
|
10.7 %
|
10.9 %
|
9.3 %
|
4.0 %
|
These results include a $0.15
quarterly common stock dividend throughout the nine-quarter
scenario horizon.
First Horizon's loan portfolio stressed loss rate of 2.5% is
significantly lower than the 6.8% loss rate from the Federal
Reserve-published median DFAST result. FHN's lower loss rate
benefits from portfolio mix including low loss loans to mortgage
companies and limited exposure to high loss rate credit cards.
Additionally, the Company's pre-provision net revenue as a
percentage of total assets of 4.6% exceeded the peer median of
1.9%. FHN's stresses to pre-provision net revenue are buffered by
its countercyclical businesses of loans to mortgage companies,
mortgage warehouse, and FHN Financial.
For more information, please see First Horizon's 2024 stress
test disclosure at
https://ir.firsthorizon.com/fixed-income/stress-test-results/default.aspx.
About First Horizon
First Horizon Corp.
(NYSE: FHN), with $82.2
billion in assets as of June 30,
2024, is a leading regional financial services company,
dedicated to helping our clients, communities and associates unlock
their full potential with capital and counsel. Headquartered in
Memphis, TN, the banking
subsidiary First Horizon Bank operates in 12 states across the
southern U.S. The Company and its subsidiaries offer
commercial, private banking, consumer, small business, wealth and
trust management, retail brokerage, capital markets, fixed income,
and mortgage banking services. First Horizon has been recognized as
one of the nation's best employers by Fortune and Forbes magazines
and a Top 10 Most Reputable U.S. Bank. More
information is available at
www.FirstHorizon.com.
FHN-G
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SOURCE First Horizon Corporation