TD - First Horizon Q1 earnings miss as higher funding costs weigh on NII

2023-04-18 16:34:38 ET

First Horizon ( NYSE: FHN ) turned in mixed first-quarter financial results as the benefit of higher loan rates was more than offset by a rise in funding costs and day count, it said Tuesday.

The company gave no further update on the pending acquisition by TD Bank ( TD ). At the beginning of March, TD said it does not expect that the necessary regulatory approvals will be received in time to complete the deal by May 27, and that TD cannot provide a new projected closing date.

Q1 adjusted EPS of $0.45 , falling short of the $0.47 average analyst estimate, slid from $0.51 in the previous quarter and rose from $0.38 a year before. Revenue of $859M, vs. $871.4M consensus, fell from $882M in Q4 and rose from $707M in Q1 2022.

Net interest income was 688M compared with $709M in Q4 and $479M in Q1 of last year. Net interest margin of 3.87% vs. 3.89% in the prior quarter and 2.37% in Q1 2022.

Noninterest income slipped to $171M from $174M in Q4 and from $229M in the year-earlier quarter. Noninterest expense of $478M decreased 5% Q/Q and 3% Y/Y.

Provision for credit losses came in at $50M, compared with $45M in Q4 and a benefit of $40M a year ago.

Average loans of $58.1B gained 1% Q/Q and 7% Y/Y; average deposits of $62.2B dropped 4% Q/Q and 16% Y/Y.

FHN edged down 0.2% in after-hours trading.

Last week, TD Bank CEO remained committed to completing First Horizon deal .

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