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Jun 30
First Horizon Q2 2025 Earnings Report
First Horizon reported solid earnings growth in Q2 2025 driven by loan portfolio expansion and higher net interest income.
Key Takeaways
First Horizon delivered strong Q2 2025 results with EPS of $0.45, supported by loan and deposit growth, stable credit quality, and a CET1 ratio of 11.0%.
Net income rose to $244 million, supported by higher net interest income.
CET1 ratio remained strong at 11.0%, aligning with near-term targets.
Tangible book value per share increased to $13.57 due to strong earnings and mark-to-market impacts.
Loan growth was driven by mortgage companies and C&I, with deposits increasing $1.4 billion.
First Horizon
First Horizon
Forward Guidance
Management expects modest loan growth, stable capital levels, and controlled expense management for FY25, with earnings growth supported by balance sheet optimization.
Positive Outlook
- Expected revenue growth flat to up 4% year-over-year.
- Expense guidance improved to flat to up 2%, reflecting strong cost controls.
- CET1 ratio expected to remain within 10.5% to 11.0%.
- Credit quality expected to remain stable with NCO ratio guidance of 0.15% to 0.25%.
- Focus on strategic capital deployment to enhance ROTCE.
Challenges Ahead
- Earnings remain sensitive to pace and quantity of interest rate cuts.
- Provision expense may fluctuate with macroeconomic conditions.
- NIM compression risk persists due to higher deposit costs.
- Fixed income business expected to remain under pressure in softer markets.
- Loan growth could moderate if economic conditions weaken.