FIRST HORIZON CORP

Significant Events and Transactions

Senior Notes Retirement

On May 26, 2025, FHN retired $350 million in senior notes that had reached the maturity date, utilizing part of the proceeds from the issuance of $500 million in Fixed Rate/Floating Rate Senior Notes in first quarter 2025.

Preferred Stock Redemption

On August 1, 2025, FHN redeemed all outstanding shares of its Series B Preferred Stock with a carrying value of $77 million. Prior to the redemption, the Series B Preferred Stock qualified as Tier 1 capital. See Note 17 — Subsequent Events for more information.

Financial Performance Summary

Second Quarter 2025 Highlights

FHN reported second quarter 2025 net income available to common shareholders of $233 million, or $0.45 per diluted share, compared to $213 million, or $0.41 per diluted share, in first quarter 2025 and $184 million, or $0.34 per diluted share, in second quarter 2024.

Net interest income of $641 million increased $10 million compared to first quarter 2025, driven by loan growth, primarily in loans to mortgage companies. Net interest income increased $12 million compared to second quarter 2024, driven by lower interest-bearing deposit costs and the impact of the investment portfolio repositioning in fourth quarter 2024, partially offset by lower loan yields.

Provision for credit losses was $30 million for second quarter 2025 compared to $40 million for first quarter 2025 and $55 million for second quarter 2024. Net charge-offs were $34 million, or 22 basis points, compared to $29 million, or 19 basis points, in first quarter 2025, and $34 million, or 22 basis points, in second quarter 2024.

Noninterest income of $189 million increased $8 million compared to first quarter 2025, largely driven by higher deferred compensation income, service charges and fees, and mortgage banking income, partially offset by lower fixed income. Noninterest income for second quarter 2025 increased $3 million, compared to second quarter 2024, largely driven by higher deferred compensation income.

Noninterest expense of $491 million increased $4 million from first quarter 2025 as increases in personnel and advertising and public relations expenses were partially offset by a reduction in Visa derivative valuation expense in the prior quarter. Compared with second quarter 2024, noninterest expense decreased $9 million, or 2%, largely driven by lower FDIC special assessment expense, contract employment and outsourcing expense and other expense, partially offset by an increase in computer software expense.

Year-to-Date and Period End Highlights

For the six months ended June 30, 2025, net income available to common shareholders was $446 million, or $0.86 per diluted share, compared to $368 million, or $0.67 per diluted share, for the six months ended June 30, 2024.

Net interest income increased $19 million, largely driven by lower funding costs and the impact of the investment portfolio repositioning in fourth quarter 2024, partially offset by lower loan yields.

Provision for credit losses of $70 million decreased $35 million for the year-to-date period of 2025 compared to the same period of 2024. Net charge-offs of $63 million declined $11 million for the year-to-date period of 2025 compared to $74 million for the same period of 2024. Nonperforming loans of $593 million decreased $9 million

PART I, ITEM 2. MANAGEMENT'S DISCUSSION & ANALYSIS (MD&A)

Table of Contents

from December 31, 2024 as an increase in C&I offset a reduction in CRE.

Noninterest income for the year-to-date period decreased $11 million, or 3%, primarily from lower deposit transactions and cash management fees and lower deferred compensation income.

Noninterest expense for the year-to-date period decreased $37 million, or 4%, largely attributable to lower personnel expense, deposit insurance expense and contract employment and outsourcing.

Period-end loans and leases of $63.3 billion increased $695 million, or 1%, from December 31, 2024. Commercial loans increased $446 million, largely driven by an increase of $931 million in the C&I portfolio, partially offset by a

$485 million decline in CRE balances. Growth in loans to mortgage companies contributed $587 million of the increase in the C&I portfolio. Consumer loan growth was $249 million for the year-to-date period.

Period-end deposits of $65.6 billion remained largely unchanged from December 31, 2024, with interest-bearing deposits increasing $125 million and noninterest-bearing deposits decreasing $129 million.

The Common Equity Tier 1 ratio was 10.99% at June 30, 2025 compared to 11.20% at December 31, 2024. Tier 1 risk-based capital and total risk-based capital ratios at June 30, 2025 were 12.00% and 13.95%, down from 12.22% and 14.25% at December 31, 2024.

Table I.2.1

KEY PERFORMANCE INDICATORS

(a) Represents a non-GAAP measure which is reconciled in the non-GAAP to GAAP reconciliation in Table I.2.26.

(b) Calculated using annualized net income divided by average assets.

(c) Calculated using annualized net income available to common shareholders divided by average common equity.

(d) Calculated using annualized net income available to common shareholders divided by average tangible common equity.

(e) Net interest margin is computed using total net interest income adjusted to an FTE basis assuming a statutory federal income tax rate of 21% and, where applicable, state income taxes.

(f) Ratio is noninterest income excluding securities gains (losses) to total revenue excluding securities gains (losses).

(g) Ratio is noninterest expense to total revenue excluding securities gains (losses).

The following portions of this MD&A focus in more detail on the results of operations for thethree and six months ended June 30, 2025, the three months ended March 31, 2025, and thethree and six months ended June 30, 2024 and on information about FHN's financial condition, loan and lease portfolio, liquidity, funding sources, capital and other matters.