FIRST HORIZON CORP (FHN) Business

Item 1.    Business

Our Businesses

General

First Horizon Corporation is a Tennessee corporation. We incorporated in 1968, and are headquartered in Memphis, Tennessee. We are registered as a bank holding company and have elected to be treated as a financial holding company. Our common stock is listed on the New York Stock Exchange under the symbol “FHN.” At December 31, 2025, we had total consolidated assets of $84 billion.

We provide commercial, private banking, consumer, small business, wealth and trust management, retail brokerage, capital markets, fixed income, and mortgage banking services principally through our wholly-owned subsidiary, First Horizon Bank. Founded in 1864 as First National Bank of Memphis, the Bank is a Tennessee banking corporation headquartered in Memphis, Tennessee. At December 31, 2025, the Bank had $84 billion in total assets, $68 billion in total deposits, and $64 billion in total loans (including

certain leases, before considering the allowance for loan and lease losses).

In addition to the Bank, as of December 31, 2025, First Horizon's consolidated operating subsidiaries include, but are not limited to: two subsidiaries which are registered with the SEC as investment advisors; two subsidiaries which are registered with the SEC as broker-dealers; and three subsidiaries which are licensed as insurance agencies.

At December 31, 2025, First Horizon had over 450 business locations in 23 U.S. states, excluding off-premises ATMs. Most of those locations (412) were banking centers located in southern states, including Tennessee (137), North Carolina (78), Florida (74), and Louisiana (55).

Loans

Loan Portfolios

Lending is a major source of revenue for us, and loans are our largest asset type. Table 1.1 shows our total loans (including certain leases) at year-end 2025, along with some details regarding the composition of our loans. Most of our loans are commercial.

As shown in Table 1.1, our loans are broken into two major types: commercial and consumer. Each type is broken into portfolios. Our three major portfolios are: traditional, unsecured commercial, financial and industrial (“C&I”) loans; secured commercial real estate (“CRE”) loans; and secured consumer real estate loans. A fourth portfolio consists of consumer credit card and other consumer debt.

Table 1.1

Loan Types & Portfolios1

1    Dollars and percentages at December 31, 2025.

Geographic Mix

Geographically, a significant majority of our loans originate from five states: Florida, Tennessee, Texas, North Carolina, and Louisiana. The geographic dispersion of our loans varies considerably among our three major loan portfolios, as shown in Table 1.2.

Table 1.2

Major Loan Portfolios1 by Geography

1    Dollars and percentages at December 31, 2025.

C&I Loans

The C&I portfolio, our largest portfolio by far, was $36 billion at December 31, 2025. Our C&I portfolio has an industry concentration: about 25% of C&I loans are to businesses in the financial services industry, which includes finance and insurance companies and mortgage lending companies, while 11% of our C&I loans are to borrowers in the real estate and rental and leasing industry. The rest of C&I covers a wide range of industries, as shown in Table 1.3a.

Table 1.3a

C&I Loans1 by Industry/Line of Business

1     Percentages of C&I portfolio at December 31, 2025.

(a)    Leasing, rental of real estate, equipment, and goods.

CRE Loans

The CRE portfolio was $14 billion at December 31, 2025. The largest property type within CRE is multi-family, as shown in Table 1.3b. The next three largest property types were office, retail, and industrial. At year-end, nearly half of the office loans were for medical industry office space.

Table 1.3b

CRE Loans1 by Property Type

1     Percentages of CRE portfolio at December 31, 2025.

Consumer Loans

Consumer loans totaled $15 billion at December 31, 2025, as shown in Table 1.1 above. A substantial majority of consumer loans consists of home equity loans, mortgages, and other secured consumer real estate loans.

Further information regarding our loans is provided in Note 3 beginning on page 113 appearing in our 2025 Financial Statements (Item 8), and under the captions Analysis of Financial Condition and Asset Quality, beginning on pages 48 and 51, respectively, of our 2025 MD&A (Item 7).

Deposits

Deposits comprise our largest resource to fund lending. Deposits overall also tend to be our lowest-cost funding source. At year-end 2025, we had total deposits of $67 billion. Most of our deposits are held in our commercial, consumer & wealth banking segment. Table 1.4 provides a deposit overview at December 31, 2025.

Further information regarding deposits is provided: in Note 8 beginning on page 128 appearing in our 2025 Financial Statements (Item 8); under the caption Deposits beginning on page 62 appearing in our 2025 MD&A (Item 7); and in other parts of this report referenced under Deposits.

Table 1.4

Deposit1 Overview

1    Percentages of deposits at December 31, 2025.

Business Segments

Segment Overview

Our financial results of operations are reported through operational business segments which are not closely related to the legal structure of our subsidiaries. During 2024, we reorganized our internal management structure and, accordingly, reclassified our reportable business segments. Prior to the 2024 reclassification, we operated through three business segments: (1) regional, (2) specialty, and (3) corporate. As a result of the 2024 reclassification, our reportable business segments are now composed of the following: (1) commercial, consumer & wealth, (2) wholesale, and (3) corporate. In this report, segment information for prior periods has been reclassified to conform with our current segments.

Financial and other additional information concerning our segments—including information concerning assets, revenues, and financial results—appears in our 2025 MD&A (Item 7) and in our 2025 Financial Statements (Item 8), especially in Note 19—Business Segment Information. Note 19 begins on page 150.

Commercial, Consumer & Wealth and Wholesale Banking Segments

By far most of our loans and deposits are in the commercial, consumer & wealth and wholesale banking segments. Similarly, those segments are the sources of most of our revenues and expenses. The two segments create and use financial resources differently, and the revenues they generate have a very different mix of net interest income vs. noninterest income. In addition, commercial, consumer & wealth banking is larger than wholesale banking by many financial measures. Table 1.5 provides high-level financial information for each of those two segments, highlighting these points.

Table 1.5

Commercial, Consumer & Wealth (CCW) vs Wholesale Banking Snapshot

Commercial, Consumer & Wealth and Wholesale Lines of Business

The principal lines of business in the commercial, consumer & wealth banking segment are:

•commercial banking (larger business enterprises)

•business banking (smaller business enterprises)

•consumer banking

•private client investment, wealth management, financial planning, trust and asset management services

•asset-based lending

•commercial real estate

•equipment finance/leasing

•energy finance

•international banking

•healthcare finance

•transportation and logistics finance

•treasury management solutions

•loan syndications

•corporate banking services

The principal lines of business in the wholesale banking segment are:

•fixed income securities sales, trading, underwriting, and strategies for institutional clients

•loan sales

•portfolio advisory services

•derivative sales

•mortgage warehouse lending

•franchise finance

•correspondent banking

•mortgage origination

Geographically, commercial, consumer & wealth banking's traditional lending and deposit taking activities mainly

serve commercial and consumer clients located in markets associated with our banking center footprint. Many of the businesses within wholesale banking, as well as several specialty lines of business within commercial, consumer & wealth banking, have much broader geographic reach.

Business Developments

In July 2020, we completed a merger of equals transaction with IBERIABANK Corporation and purchased 30 branches from Truist Bank, making 2020 a transformative year. In February 2022, we completed the principal systems conversion work related to that merger.

On February 27, 2022, FHN entered into an Agreement and Plan of Merger with The Toronto-Dominion Bank, a Canadian chartered bank (“TD”) and certain TD subsidiaries. Under that agreement, TD was to acquire FHN for an all-cash purchase price of $25 per FHN common share, with the price modestly increasing if the transaction closed later than a certain date. FHN and TD agreed to terminate the transaction on May 4, 2023, after TD informed FHN that TD did not expect to receive the necessary regulatory approvals in time to complete the transaction on schedule.

Over the past few years, our strategic priorities have focused on:

•targeted and opportunistic expansion of consumer and commercial banking products and services;

•targeted and opportunistic expansion of commercial lending;

•rigorous expense management;

•managing business units and products with a strong emphasis on risk-adjusted returns on invested capital;

•providing exceptional client service and experience as a primary means to differentiate us from our competitors; and

•investments in technology and other infrastructure to attract and retain clients and to support expansion.

In 2025, we sought to advance these priorities by focusing on three sets of strategic initiatives:

•Quality and Execution. Consolidating and optimizing processes to deliver improvements in scalability, efficiency and controls, and pursuing selected technology investments to enhance our digital and data capabilities;

•Clients. Delivering premium service and value to our clients to enhance our value proposition, which focuses on relationship banking; and

•Associates. Investing in talent to elevate our capabilities and performance, effectively assessing performance and making appropriate and timely decisions based upon those assessments, and ensuring high levels of associate engagement and commitment to Company goals.

We made strong progress in advancing these initiatives throughout 2025, including by:

•Continuing to thoughtfully develop new methods, processes, and systems for providing services for clients, while preserving the high level of service our associates bring to clients and fulfilling the promise of our marketing slogan: Big Bank Muscle, Small Bank Hustle;

•Creating and filling a new senior executive role to lead strategic development and execution of a comprehensive client experience for our consumer segment;

•Engaging in strategic hiring to add banker talent, enhance specific products and product groups and to better serve specific retail markets;

•Developing and implementing a new framework to operationalize our strategic priorities for our associates and to ensure alignment of associate efforts with those priorities; and

•Continuing to implement our multi-year technology plan to transform our digital systems by:

◦building an Enterprise Data Hub as the enterprise data backbone;

◦improving client experiences by modernizing digital account opening, enhancing payments capabilities, strengthening authentication, improving fraud prevention, and elevating our mobile experience;

◦setting up a scalable and modular future-state architecture to advance our cloud maturity and API-first approach; and

◦introducing new product and banking capabilities to allow us to serve more complex business needs, attract new clients and position the bank for growth.

We continue to focus on these strategic priorities and initiatives in 2026.

Competition

In all aspects of the businesses in which we engage, we face substantial competition from banks doing business in our markets as well as from savings and loan associations, credit unions, other financial institutions, consumer finance companies, trust companies, investment counseling firms, money market and other mutual funds, insurance companies and agencies, securities firms, mortgage banking companies, hedge funds, and other firms offering financial products or services.

Our traditional lending and deposit taking businesses, especially our consumer businesses, primarily compete in those areas within the southern U.S. where we have banking center locations. Our commercial businesses also have a geographic linkage, but it is weaker. Some areas of specialty lending, such as franchise finance, mortgage warehouse lending, asset-based lending, and certain other specialty businesses are multi-regional or national in scope rather than being heavily centered on banking center locations.

Key traditional competitors in many of our markets include Bank of America N.A., Fifth Third Bank National Association, First-Citizens Bank & Trust Company (dba First Citizens Bank), Hancock Whitney Bank, Huntington National Bank, JPMorgan Chase Bank National Association, Regions Bank, Pinnacle Bank, PNC Bank National Association, Truist Bank, and Wells Fargo Bank N.A., among many others including many community banks and credit unions.

A number of recent technologies created or operated by non-banks have been integrated into the financial systems used by traditional banks. In addition, certain financial companies or their affiliates that traditionally were not banks have been able to compete more directly with the Bank for deposits and other traditional banking services

and products. Non-traditional companies competing with us for traditional banking products and services include investment banks, brokerage firms, insurance company affiliates, specialty finance companies, and extremely short-term consumer loan companies.

More recent entrants into markets for traditional banking services include: financial technology firms that offer checking, savings, and payment services through digital applications; digital‑asset providers (including exchanges, blockchain‑based payment networks, stablecoin issuers, and digital‑asset lending and financing platforms); and private credit firms that provide direct lending and other alternative financing to businesses. These entities operate under regulatory and supervisory frameworks that differ from those applicable to banks and, in many cases, may be less comprehensive and less costly.

Competition for clients related to traditional and specialty banking products and services is most pronounced in rate pricing (loan rates, loan spreads, and deposit rates), services pricing, scope of services offered, quality of service, convenience, and ease of use for self-service products such as online and mobile banking.

Our fixed income business, which is part of our wholesale banking segment, serves institutional clients, broadly segregated into depositories (including banks, thrifts, and credit unions) and non-depositories (including money managers, insurance companies, governmental units and agencies, public funds, pension funds, and hedge funds). Both client groups are widely dispersed geographically, predominantly within the U.S. We have many competitors within both groups, including major U.S. and international securities firms as well as numerous regional and local firms.

Human Resources Management

Our 160-year history is rooted in our people-focused culture, centered around teamwork and collaboration to achieve best in class results. Everything we do is aligned with our Purpose, Core Values and Commitment, holding ourselves to the highest standards of ethical conduct and operational excellence.

Our Purpose: To help our clients unlock their full potential with capital and counsel.

Our Core Values:

•We Put Clients First

•We Care About People

•We're Committed to Excellence in Everything We Do

•We Expand Access

•We Foster Team Success

Commitment: As teammates and as individuals, we must own the moment. We listen, understand and deliver.

Continuously adapting to the changing needs and expectations of our workforce remains a priority to ensure we attract and retain top talent, have a highly engaged workforce and are well positioned to serve our associates, clients, communities and shareholders.

We strive to offer a workplace in which our associates feel valued, motivated and empowered to grow and excel. In addition to competitive health care benefits, wellness programs and parental and caregiver support, we offer professional development opportunities through mentoring and career development programs. Associates can actively engage with their colleagues at work and be involved in the community in a variety of ways, including

through volunteerism and by participating in our numerous associate resource groups.

We regularly communicate through a variety of channels and seek input through formal surveys and through the Firstpower Council, a group of associates representing various areas of the company that provide direct feedback on opportunities to enhance our culture and organizational effectiveness. In 2025, we implemented an enhanced performance management process to improve

performance measurement, increase engagement between associates and their leaders, and better align associate and leader goals. In January 2026, we launched HorizonU, a new platform for centralized learning, performance, and career development for associates.

At December 31, 2025, First Horizon had 7,404 associates, including 7,277 full-time associates and 127 part-time associates, or 7,338 full-time-equivalent associates, not including contract labor for certain services.

Available Information

Our current primary internet address is www.firsthorizon.com. A link to the Investor Relations section of our internet website (ir.firsthorizon.com) appears near the bottom of the home page of our website. Near the top of the Investor Relations homepage there is a "SEC Filings" link in the banner. Clicking that link makes available to the public, free of charge, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements, and amendments thereto as soon as reasonably practicable after we file such material with, or furnish such material to, the Securities and Exchange Commission. We also use

the Investor Relations section of our website as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD. Accordingly, investors should monitor this channel in addition to our press releases, SEC filings, and public conference calls and webcasts. Additional information regarding materials available on our website is provided in Item 10 of this report beginning on page 187. No information external to this report and its exhibits, unless specifically noted otherwise, is incorporated into this report.

Supervision and Regulation

Scope of this Section

This section describes certain of the material elements of the regulatory framework applicable to bank and financial holding companies and their subsidiaries, and to companies engaged in securities and insurance activities. It also provides certain specific information about us.

This section summarizes certain statutes and regulations and does not provide a comprehensive analysis of all applicable laws. You should refer to the applicable statutes and regulations for more information. In addition,

proposals to change the laws and regulations applicable to bank and financial holding companies are frequently raised at both the state and federal levels. The likelihood and timing of any changes in these laws and regulations, and the impact such changes may have on our business, are difficult to predict. Changes in applicable laws and regulations, or their interpretation by regulatory agencies or courts, may have a material adverse effect on our business.

Overview

First Horizon Corporation is a bank holding company and financial holding company and is regulated under the Bank Holding Company Act of 1956, as amended (the “BHCA”). We and our subsidiaries are subject to the regulation and supervision of, and to examination by, the Federal Reserve under the BHCA.

First Horizon Bank, our most significant subsidiary, is a Tennessee banking corporation subject to the regulation and supervision of, and to examination by, the Tennessee Department of Financial Institutions ("TDFI"). In addition to general supervision and examination powers, the TDFI has the power to approve mergers with the Bank, the Bank’s issuance of preferred stock or capital notes, the

establishment of banking centers, and many other corporate actions.

We are also subject to the Tennessee Bank Structure Act of 1974 which, among other things, prohibits (subject to certain exceptions) a bank holding company from acquiring a bank for which the home state is Tennessee (a “Tennessee bank”) if, upon consummation, the company would directly or indirectly control 30% or more of the total deposits in insured depository institutions in Tennessee. As of June 30, 2025, the FDIC reports that the Bank held approximately 13% of such deposits.

The Bank has chosen to be a member of the Federal Reserve and, consequently, is also supervised and regulated by the Federal Reserve. The Bank is insured by,

and subject to regulation by, the FDIC and is subject to regulation in certain respects by the Consumer Financial Protection Bureau ("CFPB").

The regulatory framework governing banks and the financial industry is intended primarily to protect depositors, the Federal Deposit Insurance Fund, and the stability of the financial system, not to protect our non-depository creditors or our security holders.

First Horizon Corporation is also under the jurisdiction of the SEC and is subject to the disclosure and other regulatory requirements of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. First Horizon Corporation's stock is listed for trading on the NYSE and, consequently, we are subject to the rules of the NYSE for listed companies.

Permissible Activities other than Banking

Federal Law

A bank holding company that is not a financial holding company is limited to engaging in "banking," managing or controlling banks, and other activities found by the Federal Reserve to be "closely related to banking." Eligible bank holding companies that elect to become financial holding companies may engage in, or acquire shares of a company engaged in, a broader range of activities that are (i) financial in nature or incidental to a financial activity (as determined by the Federal Reserve in consultation with the Secretary of the Treasury), or (ii) complementary to a financial activity and do not pose a substantial risk to the safety and soundness of depository institutions or the financial system generally (as determined solely by the Federal Reserve). Activities that are financial in nature include: insurance underwriting and brokerage; merchant banking; securities underwriting, dealing, and market-making; and real estate development.

To maintain financial holding company status, a financial holding company and all of its depository institution subsidiaries must be “well capitalized” and “well managed.” A depository institution subsidiary is considered to be “well capitalized” if it satisfies the requirements for this status as discussed in “Prompt Corrective Action (PCA)” below. A depository institution subsidiary is considered “well managed” if it received a composite rating and management rating of at least “satisfactory” in its most recent examination. A financial holding company’s status will also depend upon it maintaining its status as “well capitalized” and “well managed” under applicable Federal Reserve regulations.

If a financial holding company ceases to meet these capital and management requirements, the BHCA, and the Federal Reserve’s regulations provide that the financial holding company must enter into a confidential agreement with the Federal Reserve to comply with all applicable capital and management requirements. Until the financial holding company returns to compliance, the Federal Reserve may impose limitations or conditions on the conduct of its activities, and the company may not commence any of the broader financial activities permissible for financial holding companies or acquire a company engaged in such financial activities without prior Federal Reserve approval. Bank holding companies and banks must also be both well capitalized and well

managed in order to acquire banks located outside their home state.

In order for a financial holding company to commence any new activity permitted by the BHCA or to acquire a company engaged in any new activity permitted by the BHCA, each insured depository institution subsidiary of the financial holding company must have received a rating of at least “satisfactory” in its most recent CRA performance evaluation, as discussed in “Community Reinvestment Act (“CRA”)” below.

The Federal Reserve has the power to order any bank holding company or its subsidiaries to terminate any activity or to terminate its ownership or control of any subsidiary when the Federal Reserve has reasonable grounds to believe that continuation of such activity or such ownership or control constitutes a serious risk to the financial soundness, safety, or stability of any bank subsidiary of the bank holding company.

A state-chartered member bank may similarly engage in broader financial activities indirectly through “financial” subsidiaries, subject to a number of legal requirements, including that the bank and each of its depository institution affiliates are well capitalized and well managed.

At December 31, 2025, we are a financial holding company and the Bank has a number of financial subsidiaries, as discussed under the caption General within the Our Businesses discussion at page 5 above.

Tennessee Law

Tennessee law does not expressly restrict the activities of a bank holding company or its non-bank affiliates. However, no Tennessee bank may maintain a branch office on the premises of an affiliate if the affiliate is engaged in activities that are not permissible for a bank holding company, a financial holding company, a national bank, or a national bank subsidiary under federal law. Tennessee law permits Tennessee banks to establish subsidiaries and to engage in any activities permissible for a national bank located in Tennessee, subject to compliance with Tennessee regulations relating to the conduct of such activities for the purpose of maintaining bank safety and soundness.

Payment of Dividends

First Horizon Corporation is a legal entity separate and distinct from First Horizon Bank and other subsidiaries. Our principal source of cash flow, including cash flow to pay dividends on our stock or to pay principal (including premium, if any) and interest on debt securities, is dividends from the Bank. There are statutory and regulatory limitations on the payment of dividends by the Bank to us, as well as by us to our shareholders.

The Corporation

Under Tennessee corporate law, we are not permitted to pay cash dividends if, after giving effect to such payment, we would not be able to pay our debts as they become due in the usual course of business or our total assets would be less than the sum of our total liabilities plus any amounts needed to satisfy any preferential rights if we were dissolving. In addition, in deciding whether or not to declare a dividend of any particular size, our Board must consider our current and prospective capital, liquidity, and other needs, including the needs of the Bank which we are obligated to support.

The Bank

Under Tennessee corporate law, the Bank (like the Corporation, discussed above) may not pay a dividend if the Bank would not be able to pay its debts when due or if the Bank’s assets would be inadequate, in a dissolution, to pay liabilities and preferential rights. Similarly, the Bank’s Board must consider current and prospective needs in making a decision to declare a dividend.

In addition, in order to pay cash dividends, the Bank must obtain the prior approval of the Federal Reserve and the TDFI Commissioner if the total of all dividends declared by the Bank’s board of directors in any calendar year exceeds the total of (i) the Bank’s retained net income for that year plus (ii) the Bank’s retained net income for the preceding two years, less certain required capital transfers, as applicable. Federal law also prohibits state-chartered member banks, such as the Bank, from paying dividends that would be greater than the bank’s undivided profits.

Applying the dividend restrictions imposed under applicable federal and state rules, the Bank’s total amount available for dividends, without obtaining regulatory approval, was $88 million at January 1, 2026.

Other Factors Affecting Dividends

If, in the opinion of the Federal Reserve, we or the Bank are engaged in or about to engage in an unsafe or unsound practice (which, depending on the financial condition of FHN or the Bank, could include the payment of dividends), the Federal Reserve may require us or the Bank to cease and desist from that practice.

In addition, under the Federal Deposit Insurance Act, an FDIC-insured depository institution (such as the Bank) may not make any capital distributions, pay any management fees to its holding company, or pay any dividend if it is undercapitalized or if such payment would cause it to become undercapitalized.

The payment of cash dividends by us or by the Bank also may be affected or limited by other factors, such as the requirement to maintain adequate capital above regulatory guidelines, as discussed under Capital Adequacy within this Supervision and Regulation discussion below.

The Federal Reserve generally requires insured banks and bank holding companies to pay dividends only out of current operating earnings and has indicated generally that it may be an unsafe and unsound practice for bank holding companies to pay dividends unless the bank holding company's net income over the preceding year is sufficient to fund the dividends and the expected rate of earnings retention is consistent with the company's capital needs, asset quality and overall financial condition. The Federal Reserve has released a supervisory letter advising, among other things, that a bank holding company should inform the Federal Reserve and should eliminate, defer, or significantly reduce its dividends if (i) the bank holding company’s net income available to shareholders for the past four quarters, net of dividends previously paid during that period, is not sufficient to fully fund the dividends; (ii) the bank holding company’s prospective rate of earnings is not consistent with the bank holding company’s capital needs and overall current and prospective financial condition; or (iii) the bank holding company will not meet, or is in danger of not meeting, its minimum regulatory capital adequacy ratios.

Transactions with Affiliates

The Bank’s ability to lend or extend credit to us or our other affiliates is restricted. The Bank and its subsidiaries generally may not extend credit to us or to any other affiliate of ours in an amount which, individually and in the aggregate, exceeds certain limits based, in part, on the amount of the Bank's capital. Extensions of credit and other transactions between the Bank and us or such other affiliates must be on terms and under circumstances that

are substantially the same or at least as favorable to the Bank as those prevailing at the time for comparable transactions with non-affiliated companies, and extensions of credit by the Bank to us or our other subsidiaries must be secured by specified amounts and types of collateral.

There are similar legal restrictions on other types of transactions, including: the Bank’s purchases of or investments in the securities of and purchases of assets from us or other affiliates; the Bank’s loans or extensions of credit to third parties collateralized by the securities or obligations of us or other affiliates; the issuance of guaranties, acceptances, and letters of credit on behalf of us or other affiliates; and certain Bank transactions with us or other affiliates, or with respect to which we or other affiliates act as agent, participate, or have a financial interest.

Federal law also limits the Bank’s authority to extend credit to its directors, executive officers and 10%

stockholders, as well as to entities controlled by such persons. Among other things, extensions of credit to insiders are required to be made on terms that are substantially the same as, and follow credit underwriting procedures that are not less stringent than, those prevailing at the time for comparable transactions with unaffiliated persons. Also, the terms of such extensions of credit may not involve more than the normal risk of repayment or present other unfavorable features and may not exceed certain limitations on the amount of credit extended to such persons individually and in the aggregate.

Capital Adequacy

Each of the Company and the Bank is required to maintain minimum capital levels under risk-based capital rules issued by the U.S. Federal banking regulators (the "Capital Rules"). The capital rules in the U.S. are based on international standards known as “Basel III.” The Federal Reserve may from time to time require that a banking organization maintain capital above the minimum levels discussed below, due to the banking organization’s financial condition or actual or anticipated growth. Under the Capital Rules, we and the Bank apply the Standardized Approach in measuring risk-weighted assets (“RWA”) and regulatory capital.

The Capital Rules define qualifying capital instruments and specify minimum amounts of capital as a percentage of assets that banking organizations are required to maintain.

Under the Capital Rules, risk-based capital ratios are calculated by dividing Common Equity Tier 1 (“CET1”) capital, Tier 1 capital, and total risk-based capital, respectively, by RWA. Assets and off-balance sheet credit equivalents are assigned a risk weight based primarily on supervisory assessments of relative credit risk.

Under the Capital Rules, we and the Bank are each required to maintain the following:

•CET1 to RWA of at least 4.5%;

•Tier 1 capital to RWA of at least 6%;

•Total risk-based capital to RWA of at least 8%; and

•Tier 1 capital to average consolidated assets (the “leverage ratio”) of at least 4%.

In addition, the Capital Rules require a capital conservation buffer, consisting solely of CET1 capital in an amount above the minimum risk-based capital requirements for “adequately capitalized” institutions equal to 2.5% of total RWA, resulting in a requirement for the Company and the Bank effectively to maintain CET1, Tier 1 and total capital ratios of 7%, 8.5% and 10.5%, respectively. Banking institutions with a ratio of CET1

capital to RWA above the minimum requirement but below the capital conservation buffer face restrictions on the ability to pay dividends, pay discretionary bonuses, and to engage in share repurchases based on the amount of the shortfall and the institution’s “eligible retained income” (the greater of (i) net income for the preceding four quarters, net of distributions and associated tax effects not reflected in net income, and (ii) average net income over the preceding four quarters).

CET1 capital consists of common stock instruments that meet the eligibility criteria in the Capital Rules, including common stock and related surplus, net of treasury stock, retained earnings, and certain minority interests. The Capital Rules provide for a number of deductions from and adjustments to CET1 capital. As a “non-advanced approaches” firm under the Capital Rules, the Company is subject to rules that provide for simplified capital requirements relating to the threshold deductions for mortgage servicing assets, deferred tax assets arising from temporary differences that a banking organization could not realize through net operating loss carrybacks, and investments in the capital of unconsolidated financial institutions, as well as the inclusion of minority interests in regulatory capital. The Company and the Bank, as non-advanced approaches banking organizations, made a one-time, permanent election under the Capital Rules to exclude the effects of certain components of accumulated other comprehensive income (“AOCI”) included in shareholders’ equity under U.S. GAAP in determining regulatory capital ratios.

Federal regulators may also consider concentration of credit risk and certain risks arising from non-traditional activities, and the management of such risks, as important qualitative factors in assessing the Bank's and our overall capital adequacy.

Failure to meet capital guidelines could result in actions by regulators that could have a material adverse impact on our operations or financial condition, including the termination of deposit insurance by the FDIC, the inability to receive regulatory approval for expansion or new

activities, restrictions on our business, and in certain circumstances the appointment of a conservator or receiver.

At December 31, 2025, our CET1 capital ratio was 10.63% and the Bank’s was 10.98%; our Tier 1 capital ratio was 11.51% and the Bank’s was 11.38%; our total capital ratio was 13.35% and the Bank’s was 13.04%; and our leverage ratio was 10.19% and the Bank’s was 10.09%.

In addition to the Capital Rules, the Bank is required to have a capital structure that the TDFI determines is adequate, based on TDFI’s assessment of the Bank’s businesses and risks. The TDFI may require the Bank to increase its capital, if found to be inadequate.

Prompt Corrective Action (PCA)

Under the Federal Deposit Insurance Act (the "FDIA"), Federal banking regulators must take “prompt corrective action” regarding FDIC-insured depository institutions (such as the Bank) that do not meet minimum capital requirements. For this purpose, insured depository institutions are divided into five capital categories: "well capitalized," "adequately capitalized," "undercapitalized," "significantly undercapitalized," and "critically undercapitalized."

Regulators must take certain mandatory supervisory actions, and are authorized to take other discretionary actions, with respect to institutions that are less than adequately capitalized, with supervisory actions progressively becoming more punitive as the institution’s capital category declines. Supervisory actions include: (i) restrictions on payment of capital distributions and management fees, (ii) requirements that a federal bank regulator monitor the condition of the institution and its efforts to restore its capital, (iii) submission of a capital restoration plan, (iv) restrictions on the growth of the institution’s assets, and (v) requirements for prior regulatory approval of certain expansion proposals.

A bank that is “critically undercapitalized” (i.e., has a ratio of tangible equity to total assets that is equal to or less than 2.0%) will be subject to further restrictions and generally will be placed in conservatorship or receivership within 90 days.

To be well capitalized, the Bank must maintain at least the following capital ratios: a CET1 ratio of at least 6.5%, Tier 1 Capital ratio of at least 8%, Total Capital ratio of at least 10%, and a Leverage ratio of at least 5%, and must not be

subject to any written agreement, order, capital directive, or prompt corrective action directive to meet and maintain a specific capital level for any capital measure.

At December 31, 2025, the Bank had sufficient capital to qualify as “well capitalized” under the regulatory capital requirements discussed above. An institution may be deemed to be in a capitalization category that is lower than is indicated by its actual capital position if it receives an unsatisfactory examination rating.

The FDIA’s prompt corrective action provisions apply only to depository institutions such as the Bank, and not to bank holding companies. Under the Federal Reserve’s regulations, a bank holding company, such as the Company, is considered “well capitalized” if the bank holding company (i) has a total risk based capital ratio of at least 10%, (ii) has a Tier 1 risk-based capital ratio of at least 6%, and (iii) is not subject to any written agreement order, capital directive, or prompt corrective action directive to meet and maintain a specific capital level for any capital measure. At December 31, 2025, we had sufficient capital to qualify as “well capitalized” under these regulations. Although prompt corrective action regulations apply only to depository institutions and not to bank holding companies, a bank that is required to submit a capital restoration plan generally must concurrently submit a performance guarantee by its parent holding company. The liability of the parent holding company under any such guarantee is limited to the lesser of five percent of the bank’s assets at the time it became “undercapitalized” or the amount needed to comply.

Resolution Planning

The FDIC requires certain insured depository institutions with more than $50 billion in total assets to periodically submit resolution plans to provide the FDIC with information about the bank that is essential to effective resolution planning and to support the execution of a resolution, if necessary. In June 2024, the FDIC amended its insured depository institution resolution plan rule, which requires the Bank, as a “Group B” insured

depository institution with between $50 billion and $100 billion in total assets, to submit informational filings on a three-year cycle and provide limited interim supplements in each of the off-years. The final rule became effective October 1, 2024. The Bank’s initial information filing submission is due on or before April 1, 2026.

Safety and Soundness Compliance Planning

Under Section 39 of the Federal Deposit Insurance Act (FDIA), when an insured depository institution is notified that it is not meeting prescribed safety and soundness standards, the federal banking agencies are authorized but not required to order the institution to submit a compliance plan. If the institution is given notice to submit a compliance plan and fails to submit an acceptable plan or fails in any material respect to implement an

acceptable plan, the agency must issue an order directing the institution to correct the deficiency and may issue an order directing other actions that could include imposing restrictions comparable to those applicable to undercapitalized institutions. Failure to comply with an agency order may result in judicial enforcement and the imposition of civil money penalties.

Enhanced Prudential Standards

The Federal Reserve has established enhanced prudential standards for larger bank holding companies based on size and certain risk-based indicators. Under the Federal Reserve's regulations, bank holding companies with total consolidated assets of $250 billion or less generally are not subject to certain enhanced capital and liquidity prudential standards, including company-run stress testing, capital planning, liquidity coverage ratio, and resolution planning requirements, among others. Although we are beneath the $250 billion asset threshold for mandatory company-run stress testing, we perform certain stress tests internally and incorporate the economic models and information developed through our stress testing program into our risk management and capital planning activities, which continue to be subject to the regular supervisory processes of the Federal Reserve.

If we were to become a "Category IV" firm under the Federal Reserve's regulations (i.e., if our total consolidated assets were to exceed $100 billion), we would become subject to certain enhanced prudential standards, which would significantly increase our regulatory compliance costs. These additional standards would include additional liquidity risk management requirements, more onerous internal liquidity stress testing and liquidity buffer requirements, supervisory stress testing, the stress capital buffer, additional capital planning requirements, additional reporting to the Federal Reserve and more comprehensive resolution plan filings with the FDIC.

Source of Strength Requirement

Under the Dodd-Frank Act, we are required to act as a source of financial strength to, and to commit resources to support, the Bank. This support may be required even at times when we might not be able to provide it without adversely affecting our ability to meet other obligations. In addition, any capital loans by a bank holding company to any of its subsidiary banks are subordinate in right of payment to deposits and to certain other indebtedness of

the subsidiary bank. In the event of a bank holding company’s bankruptcy, any commitment by the bank holding company to a federal bank regulatory agency to maintain the capital of a subsidiary bank will be assumed by the bankruptcy trustee and entitled to a priority of payment.

Interstate Branching & Mergers

The Bank generally must have TDFI’s approval to establish a new banking center (technically, a “branch”). For a new banking center located outside of Tennessee, Tennessee law requires the Bank to comply with branching laws applicable to the state where the new banking center will be located. Federal law allows the Bank to establish or acquire a branch in another state to the same extent that a bank chartered in that other state would be allowed to establish or acquire a branch in that state.

Federal law permits a bank holding company, with Federal Reserve approval, to acquire banking institutions outside the bank holding company's home state through merger or acquisition without regard to whether the transaction is prohibited under state law, but subject to any state requirement that the bank has been organized and

operating for a minimum period of time, not to exceed five years. In addition, the acquiring bank must be well-capitalized and well-managed; concentration limits on liabilities and deposits may not be exceeded; regulators must assess the transaction for incremental systemic risk; and the acquiring bank must have at least “satisfactory” standing under the federal Community Reinvestment Act (discussed immediately below). Moreover, mergers and acquisitions that are large enough are subject to anti-trust review by the U.S. Department of Justice.

Once a bank has established branches in a state through de novo or acquired branching or through an interstate merger or acquisition transaction, the bank may then establish or acquire additional branches within that state

to the same extent that a bank chartered in that state is allowed to establish or acquire branches within the state.

Community Reinvestment Act (“CRA”)

The CRA requires each U.S. bank, consistent with safe and sound operation, to help meet the credit needs of each community where the bank accepts deposits, including low- and moderate-income (“LMI”) communities. The Federal Reserve assesses the Bank periodically for CRA compliance, and that assessment is made public. The Bank's CRA performance is evaluated on the distribution, responsiveness, and impact of its lending, investment and service activities within its assessment areas with particular emphasis on meeting the credit and community development needs of LMI communities.

A CRA rating below “Satisfactory” can slow or halt a bank’s plans to expand by branching, acquisition, or merger, and can prevent a bank holding company from becoming a financial holding company. In its most recent publicly reported CRA assessment, for 2024, the Bank received ratings of "High Satisfactory" in Lending and in Service, "Outstanding" in Investment, and "Satisfactory" overall.

In 2023, federal banking agencies adopted final rules establishing a significantly revised framework for applying

the CRA. The new rules were preliminarily enjoined by a federal district court in 2024. In July 2025, the agencies proposed a rule to rescind the revised CRA framework and to replace it with the framework that existed prior to the 2023 rule, though no assurance can be given regarding the final regulatory outcome or timing.

Regulatory approaches to CRA compliance continue to evolve, and future rulemakings or judicial actions could result in additional compliance obligations, data collection requirements, or examination methodologies, any of which may increase operational costs or potentially affect the Bank's ability to achieve favorable CRA ratings.

Management maintains a comprehensive CRA compliance and data governance program designed to monitor performance, support regulatory exams, and ensure alignment with evolving regulatory expectations.

Interchange Fee Restrictions

Regulations cap interchange fees which the Bank may charge merchants for debit card transactions.

Regulatory changes proposed in 2023, if adopted, would lower that cap, but a recent federal court ruling vacating

the existing regulations makes the future of proposed changes unclear. In early 2026, these proposed changes remained pending.

Volcker Rule

The so-called Volcker Rule (1) generally prohibits banks from engaging in proprietary trading, which is engaging as principal (for the bank’s own account) in any purchase or

sale of one or more of certain types of financial instruments, and (2) limits banks’ ability to invest in or sponsor hedge funds or private equity funds. The Volcker Rule regulation contains exemptions for market-making,

hedging, underwriting, and trading in U.S. government and agency obligations, and also permits certain ownership interests in certain types of covered funds to be retained. It also permits the offering and sponsoring of covered funds under certain conditions. The Company does not engage in any significant covered fund activities that are affected by the Volcker Rule.

Anti-Money Laundering

A major focus of U.S. federal governmental policy as it relates to financial institutions is aimed at combating money laundering and terrorist financing. Financial institutions are required to take certain measures to identify their customers, prevent money laundering, monitor customer transactions, and report suspicious activity to U.S. law enforcement agencies. Financial institutions also are required to respond to requests for information from federal banking agencies and law enforcement agencies.

Financial institutions that hold correspondent accounts for foreign banks or provide private banking services to

foreign individuals are required to take measures to avoid dealing with certain foreign individuals or entities, including foreign banks with profiles that raise money laundering concerns, and are prohibited from dealing with foreign shell banks and persons from jurisdictions of particular concern. Financial institutions also are required to establish internal anti-money laundering programs.

The failure of a financial institution to maintain and implement adequate programs to combat money laundering and terrorist financing, or to comply with the relevant laws and regulations, could have serious consequences for the financial institution, including large

fines and causing the applicable bank regulatory authorities to not approve merger or acquisition transactions or to prohibit such transactions even if prior approval is not required.

Office of Foreign Assets Control Regulation

The Office of Foreign Assets Control ("OFAC"), within the U.S. Department of the Treasury, administers and enforces economic and trade sanctions against targeted foreign countries and regimes, under authority of various laws. OFAC publishes lists of specially designated targets, issues regulations, and implements executive orders that restrict dealings with certain individuals, entities, countries, and territories. The Bank is responsible for,

among other things, blocking accounts of, and transactions with, such targets and countries, prohibiting unlicensed trade and financial transactions with them and reporting blocked transactions after their occurrence. Failure to comply with these sanctions could have serious legal and other consequences.

Consumer Regulation

We and the Bank are subject to federal and state laws designed to protect consumers and prohibit unfair or deceptive business practices, including the Equal Credit Opportunity Act, the Fair Housing Act, the Home Ownership Protection Act, the Fair Credit Reporting Act (“FCRA”), as amended by the Fair and Accurate Credit Transactions Act of 2003 (“FACT Act”), the Gramm-Leach-Bliley Act of 1999 (“GLBA”), the Truth in Lending Act, the CRA, the Home Mortgage Disclosure Act, the Real Estate Settlement Procedures Act, the National Flood Insurance Act and various state law counterparts. These laws and regulations require certain disclosure and regulate the manner in which financial institutions must interact with customers when taking deposits, making loans, collecting loans, and providing other services.

In addition, the CFPB adopts and administers significant rules affecting consumer lending and consumer financial services. Key rules for the Bank include detailed regulation of mortgage servicing practices and detailed regulation of mortgage origination and underwriting practices. The latter rules, among other things, establish the definition of a “qualified mortgage” using traditional underwriting

practices involving down payments, credit history, income levels and verification, and so forth. The rules do not prohibit, but do tend to discourage, lenders from originating non-qualified mortgages.

During 2025, the CFPB announced a plan to reduce its staff by over 80%, but implementation of the plan has been enjoined while a federal appeals court considers the plan's legality. The effects of these developments on banking organizations subject to CFPB regulation and supervision, including us and the Bank, are uncertain.

Federal law permits states to adopt consumer protection laws and standards that are more stringent than those adopted at the federal level and, in certain circumstances, permits state attorneys general to enforce compliance with both the state and federal laws and regulations. States and state attorneys general may increase regulatory, investigative and enforcement activity with respect to consumer protection, in response to changes in regulation, supervision and enforcement of consumer protection laws by federal regulators.

FCRA

Use of consumer reports in underwriting is regulated under the FCRA, and the FCRA also regulates reporting information to consumer reporting agencies, prescreening individuals for credit offers, sharing of consumer reports between affiliates, and using affiliate credit data for marketing purposes. Similar state laws may impose

additional requirements on the Bank. A notice of proposed rulemaking to revise the FCRA was published in December 2024, with comments to the proposal due in March 2025. The CFPB subsequently withdrew the proposed rule in May 2025.

Mortgage Reform

The Dodd-Frank Act prescribes certain standards that mortgage lenders must consider before making a residential mortgage loan, including verifying a borrower’s ability to repay such mortgage loan, and allows borrowers to assert violations of certain provisions of the Truth in Lending Act as a defense to foreclosure proceedings.

Under the Dodd-Frank Act, prepayment penalties are prohibited for certain mortgage transactions and creditors are prohibited from financing insurance policies in connection with a residential mortgage loan or home equity line of credit. In addition, the Dodd-Frank Act prohibits mortgage originators from receiving

compensation based on the terms of residential mortgage loans and generally limits the ability of a mortgage originator to be compensated by others if compensation is received from a consumer. The Dodd-Frank Act requires mortgage lenders to make additional disclosures prior to

the extension of credit, in each billing statement, and for negative amortization loans and hybrid adjustable rate mortgages.

Data Security, Privacy & Portability

Security & Privacy

Federal law restricts the Bank’s ability to share certain information with affiliates and non-affiliates for marketing and/or non-marketing purposes, or to contact clients with marketing offers. Affiliate and non-affiliate sharing initiated by the Bank generally is permitted unless the client elects not to permit sharing.

Federal law also requires banks to implement a comprehensive information security program that includes administrative, technical, and physical safeguards. Banks are required to have appropriate data governance practices and risk management processes as key functions supporting their operational resilience.

In the event of a cyber- or computer-related security incident, federal banking regulations require a bank to notify its primary federal regulator of certain "computer-security" incidents within 36 hours after the bank determines that a computer-security incident has occurred. Under these regulations, we and the Bank are required to notify the Federal Reserve of any incident that has materially disrupted or degraded, or is reasonably likely to materially disrupt or degrade the banking organization’s ability to deliver services to a material portion of its customer base, jeopardize the viability of key operations of the banking organization, or pose a threat to U.S. financial stability.

Data privacy and protection increasingly is an area of significant state legislative focus. One prominent example

is the California Data Privacy Protection Act, which applies to for-profit businesses that conduct business in California and meet revenue or data collection thresholds, including the Bank. Subject to certain exemptions, the statute gives California consumers the right to request disclosure of information collected about them, and whether that information has been sold or shared with others, the right to request deletion of personal information, the right to opt out of the sale of the consumer’s personal information, and the right not to be discriminated against for exercising these rights. Similar laws have been adopted by other states and may be adopted by additional states in the future, including states in which we or the Bank do business.

Open Banking

In October 2024, the CFPB adopted a new "Personal Financial Data Rights" rule. Under the CFPB rule, banks will be required to make client data available upon request to the client and authorized third parties in a secure and reliable manner without charge. The CFPB will implement its data portability rule in phases, with banks that hold at least $10 billion in total assets, but less than $250 billion, required to comply by April 1, 2027. The rule is the subject of litigation, and enforcement is currently stayed while the CFPB considers revisions to the rule.

Climate-Related Laws and Regulations

Several states have enacted or proposed statutes or regulations addressing climate-related issues. For example, in 2023, California enacted two laws which, taken together, will require most larger companies doing business in California to report annually their greenhouse gas (GHG) emissions and to report biennially their climate-related financial risks and risk-mitigation measures. The California laws have been challenged in court, and certain of those challenges remain pending.

In addition, in March 2024, the SEC adopted final rules which would require all U.S. companies with publicly-

traded securities to report annually their Scope 1 and 2 GHG emissions and related risk-management processes, and would include a related financial statement and audit requirement, among other things. There is considerable uncertainty as to whether these rules will be implemented as adopted, both because the SEC has suspended effectiveness of those rules while legal challenges are pending and because shifts in executive and legislative branches of government could lead the SEC to withdraw or significantly alter those rules.

FDIC Insurance Assessments; DIF

U.S. bank deposits generally are insured up to $250,000, subject to applicable limitations, by the Deposit Insurance Fund (“DIF”), administered by the FDIC. The system of

FDIC insurance premium rates charged consists of a rate grid structure in which base rates range from 5 to 32 basis points annually, with fully adjusted rates ranging from 2.5

to 42 basis points annually. (A basis point is equal to 0.01%.) These rates reflect a temporary increase generally equal to 2 basis points implemented by the FDIC in 2023. Also, for eight quarters starting in 2024, the FDIC has imposed a special assessment, of 3.36 basis points per quarter, intended to replenish the DIF in the aftermath of three large regional bank failures that occurred in March and May of 2023. In December 2025, the FDIC determined it would not be necessary to extend the initial eight-quarter collection period; in addition, the FDIC reduced the special assessment rate to 2.97 basis points for the eighth collection quarter, which has an invoice payment date of March 30, 2026.

Key factors in the grid include: the institution’s risk category (I to IV); whether the institution is deemed large

and highly complex; whether the institution qualifies for an unsecured debt adjustment; and whether the institution is burdened with a brokered deposit adjustment. Other factors can impact the base against which the applicable rate is applied, including (for example) whether a net loss is realized.

Insurance of deposits may be terminated by the FDIC upon a finding that the institution has engaged in unsafe and unsound practices, is in an unsafe or unsound condition to continue operations, or has violated any applicable law, regulation, rule, order, or condition imposed by a federal bank regulatory agency.

Depositor Preference

Federal law provides that deposits and certain claims for administrative expenses and associate compensation against an insured depository institution would be afforded a priority over other general unsecured claims

against such an institution, including claims of the parent bank holding company, in the “liquidation or other resolution” of such an institution by any receiver.

Limitations on Acquisitions of Our Common Stock

The Change in Bank Control Act prohibits a person or group of persons acting in concert from acquiring “control” of a bank holding company unless the Federal Reserve has been notified and has not objected to the transaction. Under a rebuttable presumption established by the Federal Reserve, the acquisition of 10% or more of a class of voting securities of a bank holding company with a class of securities registered under Section 12 of the Exchange Act would generally constitute the acquisition of control of a bank holding company. In addition, the BHCA prohibits any company from acquiring control of a bank or

bank holding company without first having obtained the approval of the Federal Reserve. Under the BHCA, a company is deemed to control a bank or bank holding company if the company owns, controls or holds with power to vote 25% or more of a class of voting securities of the bank or bank holding company, controls in any manner the election of a majority of directors or trustees of the bank or bank holding company, or the Federal Reserve determines that the company has the power to exercise a controlling influence over the management or policies of the bank or bank holding company.

Securities Regulation

Certain of our subsidiaries are subject to various securities laws and regulations and capital adequacy requirements promulgated by the regulatory and exchange authorities of the jurisdictions in which they operate.

Our registered broker-dealer subsidiaries are subject to the SEC’s net capital rule, Rule 15c3-1. That rule requires the maintenance of minimum net capital and limits the ability of the broker-dealer to transfer large amounts of capital to a parent company or affiliate. Compliance with

the rule could limit operations that require intensive use of capital, such as underwriting and trading.

As of December 31, 2025, two of our subsidiaries were registered investment advisers which are regulated under the Investment Advisers Act of 1940. Advisory contracts with clients automatically terminate under these laws upon an assignment of the contract by the investment adviser unless appropriate consents are obtained.

Insurance Activities

Certain of our subsidiaries sell various types of insurance as agent in a number of states. Insurance activities are subject to regulation by the states in which such business is transacted. Although most of such regulation focuses on insurance companies and their insurance products,

insurance agents and their activities are also subject to regulation by the states, including, among other things, licensing and marketing and sales practices.

Compensation & Risk Management

The Federal Reserve has issued guidance intended to ensure that incentive compensation arrangements at financial organizations take into account risk and are consistent with safe and sound practices. The guidance is based on three “key principles” calling for incentive compensation plans to: appropriately balance risks and rewards; be compatible with effective controls and risk management; and be backed up by strong corporate governance. In response: we operate an enhanced risk management process for assessing risk in incentive compensation plans; several key incentive programs use a net profit approach rather than a revenues-only approach; and mandatory deferral features are used in several key programs, including an executive program.

In 2016 federal agencies proposed regulations which could significantly change the regulation of incentive compensation programs at financial institutions, including FHN and the Bank. In July 2024, the OCC, FDIC, Federal Housing Finance Agency and National Credit Union Administration jointly re-proposed the regulatory text of the 2016 proposal, but the FDIC rescinded its support for the re-proposal in March 2025. The Federal Reserve and the SEC did not join the re-proposal, and the proposed rule will not be published in the Federal Register until the agencies have joined. The proposed regulations have not been finalized and future implementation remains uncertain.

Non-Discrimination in Banking

In recent years, certain states have enacted, or have proposed to enact, statutes, regulations or policies that prohibit financial institutions from denying or canceling products or services to a person or business, or otherwise discriminating against a person or business in making available products or services, on the basis of certain social or political factors or other activities. In August 2025, President Trump signed Executive Order 14331, “Guaranteeing Fair Banking Access for All Americans,” which states that it is the policy of the United States that no American should be denied access to financial services because of their constitutionally or statutorily protected beliefs, affiliations, or political views. The Executive Order directs the Treasury Secretary and federal banking regulators to address politicized or unlawful debanking activities.