First Horizon (NYSE:FHN) 2026 Conference Summary Company Overview - First Horizon operates as a commercial and consumer banking organization across a 12-state footprint in the Southern United States, from Virginia to Texas and Arkansas to Florida, following the merger with IberiaBank [4][5] - The company focuses on commercial banking but also has a diverse range of specialty businesses to balance across rate cycles [4] Economic Environment - The economies within First Horizon's operational footprint are strong, characterized by low unemployment rates and significant in-migration [5] - The Southern United States is expected to be a major growth engine for the U.S. economy in the foreseeable future [5] Strategic Focus and Momentum - First Horizon has simplified its strategic framework from 70-80 pages to 6-7 pages, enhancing organizational clarity and focus [6] - The company aims to generate an additional $100 million in pre-tax profitability through various initiatives, with progress already being made [7][10] - The integration of IberiaBank and First Horizon is a key focus, ensuring consistent consumer strategies across all business lines [9] Lending and Growth - The start of 2026 has shown strong momentum, with loan closings and pipelines performing well, particularly in the Commercial & Industrial (C&I) sector, which is up over 1% quarter-over-quarter [13] - Commercial real estate lending has seen some payoffs, but pipelines are strong, indicating a potential recovery in construction funding [17][18] Mortgage Warehouse Lending - The Mortgage Warehouse business has been stable, with expectations of increased refinancing activity due to lower interest rates [21][25] - The business is characterized by seasonality, with growth expected in the second and third quarters [25] Deposit Environment - The company is experiencing a secular change in deposit pricing, driven by technology and increased transparency in rates [38] - Despite strong competition for deposits, First Horizon has managed to maintain a healthy deposit base and is well-positioned to grow it further [40] Expense Management - First Horizon is confident in managing expenses to remain flat while expanding its capabilities and hiring new talent [46][47] - The company has identified areas of high spending that can be reduced in 2026 [46] Regulatory Environment - The regulatory landscape appears to be improving, with less concern about the $100 billion asset threshold and its implications for the company [50] - First Horizon is proactively managing its balance sheet to ensure compliance and operational efficiency [51] M&A Strategy - The company is open to small, strategic acquisitions but prioritizes organic growth and capital return to shareholders over significant M&A activity [62] - There is a focus on maintaining flexibility in operations and avoiding distractions from larger acquisitions [62] Capital Management - First Horizon has executed a significant buyback program, purchasing approximately $900 million in common stock, with plans for continued buybacks [73] - The company aims for a CET1 ratio of 10%-10.5%, aligning with industry standards while returning excess capital to shareholders [74][75] Conclusion - First Horizon is positioned for growth in a strong economic environment, with a clear strategic focus on profitability, expense management, and organic growth while navigating regulatory changes and competitive pressures in the banking sector [5][62][75]