After First Horizon reported weaker-than-expected profits on Wednesday morning, the regional bank’s CEO, Brian Jordan, told CNBC’s Jim Cramer that tough competition in the industry could continue through the rest of the year.
“Competition is increasing. Money market and CD deposit rates are becoming very competitive,” Jordan said. “We’re seeing a lot of special rates in the market, but what we’ve experienced this quarter has been a little different than what we’ve seen in previous quarters.”
Jordan also said the competition “has led to some incremental costs” as First Horizon has increased the cost of deposits by matching rates for customers, but he said the company “remains committed to its customer base,” adding that it thinks about the business for the long term, not quarterly.
First Horizon is headquartered in Memphis, Tennessee, and has operations in 12 states, primarily in the Southeast. As of Wednesday’s close, First Horizon shares were down 5.79%.
Jordan said the rest of the year could be “a bit of a battleground” due to uncertainty surrounding both the presidential election and the Federal Reserve’s interest rate decisions. He noted that the outcome of the election will affect regulation, taxation and competition in the economy. He added that it’s unclear when the Fed plans to cut interest rates and by how much.
“Once those two issues are resolved, the economy should start to accelerate and we should see a little bit of demand for loans pick up,” he said. “But I think there’s reason to be optimistic about 2025 and beyond.”
