MEMPHIS,
Tenn., Sept. 29, 2023 /PRNewswire/ -- First
Horizon Corporation (NYSE: FHN) ("First Horizon" or "the
Company") announced today its 2023 Bank Holding Company-run capital
stress test results which demonstrate the ability to successfully
navigate periods of economic stress and maintain capital ratios
well above regulatory-required minimums. These internally generated
results, which utilized the 2023 Severely Adverse Scenario
published by the Federal Reserve on February
9, 2023, reflect continued strong risk discipline.
"Our 2023 stress test results demonstrate the resilience of our
diversified business model, strong capital position and commitment
to prudent risk management through all economic environments," said
Chief Financial Officer Hope
Dmuchowski. "Our minimum common equity tier 1 capital ratio
of 8.7% reflects an additional $4
billion of pre-tax loss absorption capacity beyond the
required regulatory minimums and our stressed loss rates and
pre-provision net revenue results once again outperformed the
Federal Reserve published CCAR-bank median."
The following table reflects the Company's ending and minimum
capital ratios under the Federal Reserve's Severely Adverse
Scenario compared to the required regulatory minimums.
% Regulatory
Ratio
|
Actual
|
Projected Stressed
Capital Ratios
|
Minimum
Regulatory Capital
Ratios
|
4Q22
|
Ending
|
Minimum
|
Common equity tier 1
capital ratio
|
10.2 %
|
8.8 %
|
8.7 %
|
4.5 %
|
Tier 1 risk-based
capital ratio
|
11.9 %
|
10.4 %
|
10.4 %
|
6.0 %
|
Total risk-based
capital ratio
|
13.3 %
|
12.6 %
|
12.6 %
|
8.0 %
|
Tier 1 leverage
ratio
|
10.4 %
|
9.5 %
|
9.4 %
|
4.0 %
|
The Company's minimum common equity tier 1 ratio under stress of
8.7% reflects an additional $4.0
billion in pre-tax loss absorption capacity above the 4.5%
regulatory required minimum. These results include a $0.15 quarterly common stock dividend throughout
the nine-quarter forecast horizon.
First Horizon's loan portfolio stressed loss rate of 2.3% was
3.9 percentage points below the Federal Reserve-published median
CCAR-bank result. The Company's stress test utilized Current
Expected Credit Loss-based models for allowance and credit losses
and reflected total cumulative losses of $1.3 billion. Additionally, the Company's
pre-provision net revenue as a percentage of total assets of 2.7%
exceeded the peer median of 2.1%.
For more information, please see First Horizon's 2023 stress
test disclosure at
https://ir.firsthorizon.com/investor-relations/news-and-events/stress-testing-results/default.aspx.
About First Horizon
First Horizon Corp. (NYSE:
FHN), with $85.1 billion in assets as
of June 30, 2023, 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, mortgage, and title
insurance 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