Pre-provision net revenue down 7% from the prior quarter and up 5% on an adjusted basis*
ROTCE of 19.1% and adjusted ROTCE of 21.7% with tangible book value per share of $10.23*
MEMPHIS, Tess., Jan. 18, 2023 /PRNewswire/ — First Horizon Corporation (NYSE: FHN or “First Horizon”) today reported fourth quarter net income available to common shareholders (“NIAC”) of $258 million, or earnings per share of $0.45, compared with third quarter 2022 NIAC of $257 million, or earnings per share of $0.45.
Fourth quarter 2022 results were reduced by a net $34 million after-tax, or $0.06 per share, of notable items compared with a net $5 million, or $0.01 per share, increase in third quarter 2022. Excluding notable items, adjusted fourth quarter 2022 NIAC of $293 million, or $0.51 per share, increased from $252 million, or $0.44 per share in third quarter 2022.
Full year 2022 NIAC of $868 million, or earnings per share of $1.53, compares with $962 million, or earnings per share of $1.74, in 2021, largely reflecting the impact of provision expense. 2022 results included a net $82 million after-tax reduction, or $0.15, from notable items compared with $179 million, or $0.32 per share, in 2021. On an adjusted basis, full year 2022 NIAC of $950 million, or earnings per share of $1.68, compares with NIAC of $1.1 billion, or earnings per share $2.07 in 2021.
“Our results for the quarter and year reflect the strength of our markets and the continued momentum of our attractive business mix,” said Chairman and Chief Executive Officer Bryan Jordan. “Amidst global uncertainty and a challenging macroeconomic landscape, we delivered exceptional net interest income, net interest margin, strong loan growth, and successfully achieved our annualized net cost save target of two hundred million.”
Jordan continued, “I am incredibly proud of our associates for their steadfast commitment to drive value for our clients, communities, and shareholders as we look forward to completing the pending transaction with The Toronto-Dominion Bank (TD).”
The fourth quarter 2022 earnings materials are available on https://ir.firsthorizon.com. In addition, the financial results and earnings presentation will be furnished on a Form 8-K that will be available on the Securities and Exchange Commission website at www.sec.gov.
This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements pertain to FHN’s beliefs, plans, goals, expectations, and estimates. Forward-looking statements are not a representation of historical information, but instead pertain to future operations, strategies, financial results, or other developments. Forward-looking statements can be identified by the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “should,” “is likely,” “will,” “going forward,” and other expressions that indicate future events and trends.
Forward-looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, operational, economic, and competitive uncertainties and contingencies, many of which are beyond FHN’s control, and many of which, with respect to future business decisions and actions (including acquisitions and divestitures), are subject to change and could cause FHN’s actual future results and outcomes to differ materially from those contemplated or implied by forward-looking statements or historical performance. Examples of uncertainties and contingencies include those mentioned: in this document; in Items 2.02 and 7.01 of FHN’s Current Report on Form 8-K to which this document has been filed as an exhibit; in the forepart, and in Items 1, 1A, and 7, of FHN’s most recent Annual Report on Form 10-K, as amended; and in the forepart, and in Item 1A of Part II, of FHN’s Quarterly Report(s) on Form 10-Q filed this year.
FHN assumes no obligation to update or revise any forward-looking statements that are made in this document or in any other statement, release, report, or filing from time to time.
Certain measures included in this report 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. Although other entities may use calculation methods that differ from those used by FHN for non-GAAP measures, FHN’s management believes such measures are relevant to understanding the financial condition, capital position, and financial results of FHN and its business segments. Non-GAAP measures are reported to FHN’s management and Board of Directors through various internal reports.
The non-GAAP measures presented in this earnings release are fully taxable equivalent measures, core net interest income (“NII”), pre-provision net revenue (“PPNR”), loans and leases excluding paycheck protection program (‘PPP”) and/or Loans to Mortgage Companies (“LMC”), return on average tangible common equity (“ROTCE”), tangible common equity (“TCE”) to tangible assets (“TA”), tangible book value (“TBV”) per common share, and various consolidated and segment results and performance measures and ratios adjusted for notable items.
Presentation of regulatory measures, even those which are not GAAP, provide a meaningful base for comparability to other financial institutions subject to the same regulations as FHN, as demonstrated by their use by banking regulators in reviewing capital adequacy of financial institutions. Although not GAAP terms, these regulatory measures are not considered “non-GAAP” under U.S. financial reporting rules as long as their presentation conforms to regulatory standards. Regulatory measures used in this financial supplement include: common equity tier 1 capital (“CET1”), generally defined as common equity less goodwill, other intangibles, and certain other required regulatory deductions; tier 1 capital, generally defined as the sum of core capital (including common equity and instruments that cannot be redeemed at the option of the holder) adjusted for certain items under risk based capital regulations; and risk-weighted assets, which is a measure of total on- and off-balance sheet assets adjusted for credit and market risk, used to determine regulatory capital ratios.
Refer to the tabular reconciliation of non-GAAP to GAAP measures and presentation of the most comparable GAAP items in the financial results exhibit to FHN’s Form 8-K, beginning on page 23.
First Horizon Corp. (NYSE: FHN), with $79.0 billion in assets as of December 31, 2022, 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.
*ROTCE, PPNR, Core net interest income (NII), tangible book value per share, loans and leases excluding PPP and/or LMC, and “Adjusted” results are Non-GAAP Financial Measures; NII, Total Revenue, NIM and PPNR are presented on a fully taxable equivalent basis; References to loans include leases and EPS are based on diluted shares; Capital ratios are preliminary. Please reference the 4Q22 earnings materials at https://ir.firsthorizon.com for a description of our use of Non-GAAP measures and a reconciliation of these measures to GAAP presentation.
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SOURCE First Horizon Corporation
