First Horizon closed the fourth quarter with earnings per share of $0.52, up from $0.46 consensus, and net interest margin of 3.51%. Net interest income rose by $16 million sequentially, while headline margin was modestly lower due to Main Street Lending Program accretion in the prior quarter. Excluding that impact, margin expanded by 2 basis points. Deposit pricing drove a 25 basis‐point decline in average interest‐bearing deposit cost to 2.53% from 2.78% in Q3, contributing to stable net interest income despite modest margin compression.

Period‐end loans increased by $1.1 billion, or 2%, quarter over quarter. Mortgage company lending led with a $776 million increase—refinance activity represented one-third of volume versus roughly 25% in prior quarters—while commercial and industrial balances rose by $727 million on broad‐based origination strength, including outsized growth in equipment finance. Commercial real estate balances declined by $111 million, but the pace of paydowns slowed and commitments ticked higher, signaling momentum into 2026. The company reported a cumulative deposit beta of 64% since September 2024, and interest‐bearing spot rate ended the quarter at 2.34%.

Fee income climbed by $3 million excluding deferred compensation, driven largely by $4.4 million in equipment finance lease activity. Adjusted expenses increased by $4 million sequentially; personnel costs rose by $12 million (excluding deferred compensation) on $8 million of incentives after reaching the high end of revenue targets, and outside services costs grew by $16 million for technology, product initiatives and advertising. Management reiterated a flattish expense outlook for 2026 while maintaining a rule‐of‐thumb of 60% commission expense on countercyclical revenue growth. CEO Brian Jordan emphasized continued investments in client‐facing technology alongside efficiency gains, targeting over $100 million of pre‐provision net revenue improvement by 2027.

Common equity tier 1 ratio ended at 10.64% following $335 million of share repurchases in the quarter and $894 million for the full year. The board authorized a $1.2 billion repurchase program in October, with just under $1 billion remaining. Net charge‐offs rose by $4 million to $30 million (0.19% of average loans), in line with expectations, and no provision for credit losses was recorded as the allowance to loans ratio fell to 1.31%. For 2026, management forecasts total revenue growth of 3%–7%, net charge‐offs of 15–25 basis points, a tax rate of 21%–23% and a net interest margin around the mid‐340s, citing rate path uncertainty, loan growth timing and countercyclical business performance as key swing factors.