Trustmark Corporation Announces Second Quarter 2022 Financial Results

Performance Reflects Strong Loan Growth, Solid Credit Quality and Expanding Net Interest Margin

Trustmark Corporation (NASDAQGS: TRMK) reported net income of $34.3 million in the second quarter of 2022, representing diluted earnings per share of $0.56. Trustmark’s Board of Directors declared a quarterly cash dividend of $0.23 per share payable September 15, 2022, to shareholders of record on September 1, 2022.

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Second Quarter Highlights

  • Loans held for investment (HFI) increased $547.7 million, or 5.3%, from the prior quarter
  • Deposits totaled $14.8 billion, with noninterest-bearing deposits representing 30.5% of total deposits
  • Total revenue expanded 8.1% from the prior quarter to $165.9 million
  • Net interest income (FTE) increased 12.9% from the prior quarter to $115.6 million, resulting in a 32 basis point expansion in the net interest margin to 2.90%
  • Noninterest income totaled $53.3 million, representing 32.1% of total revenue
  • Credit quality remained solid; recoveries exceeded charge-offs and nonperforming assets declined 3.7% linked-quarter

Duane A. Dewey, President and CEO, stated, “Our company produced strong second quarter results with significant loan growth, expansion of the net interest margin, consistent performance from our fee businesses and solid credit quality. Our associates are focused on expanding existing customer relationships as well as demonstrating the value Trustmark can provide potential customers as their trusted financial partner. Our continued implementation of enhanced technology, coupled with a comprehensive program to improve efficiency, enhances Trustmark’s ability to grow and serve customers and build long-term value for our shareholders.”

Balance Sheet Management

  • Loans HFI totaled $10.9 billion, up 5.3% from the prior quarter and 7.8% year-over-year
  • Investment securities totaled $3.8 billion, up 4.3% from the prior quarter and 26.8% year-over-year
  • Deposits totaled $14.8 billion, down 2.3% from the prior quarter and up 0.9% year-over-year
  • Maintained strong capital position with CET1 ratio of 11.01% and total risk-based capital ratio of 13.26%

Loans HFI totaled $10.9 billion at June 30, 2022, reflecting an increase of $547.7 million, or 5.3%, linked-quarter and $792.0 million, or 7.8%, year-over-year. Linked-quarter growth was broad-based, with increases in virtually all categories with the exception of loans secured by other real estate and state and other political subdivision loans. Trustmark’s loan portfolio remains well-diversified by loan type and geography.

Deposits totaled $14.8 billion at June 30, 2022, down $343.1 million, or 2.3%, from the prior quarter and up $138.1 million, or 0.9%, year-over-year. The linked-quarter change was principally attributable to a decline in public funds. Trustmark continues to maintain a strong liquidity position as loans HFI represented 74.1% of total deposits at June 30, 2022. Noninterest-bearing deposits represented 30.5% of total deposits at the end of the second quarter. Interest-bearing deposit costs totaled 0.11% in the second quarter, unchanged from the prior quarter. The total cost of interest-bearing liabilities was 0.17% in the second quarter of 2022, an increase of 1 basis point from the prior quarter.

During the second quarter, Trustmark repurchased $7.5 million, or approximately 263 thousand of its common shares. During the first six months of 2022, Trustmark repurchased $16.6 million, or approximately 542 thousand of its common shares. At June 30, 2022, Trustmark had $83.4 million in remaining authority under its existing stock repurchase program, which expires on December 31, 2022. The repurchase program, which is subject to market conditions and management discretion, will continue to be implemented through open market repurchases or privately negotiated transactions. At June 30, 2022, Trustmark’s tangible equity-to-tangible assets ratio was 7.23% while its total risk-based capital ratio was 13.26%. Tangible book value per share was $19.58 at June 30, 2022, down 3.2% from the prior quarter reflecting a decline in accumulated other comprehensive income due to mark-to-market adjustments on securities available for sale resulting from the increase in market interest rates during the second quarter.

Credit Quality

  • Allowance for credit losses (ACL) represented 475% of nonaccrual loans, excluding individually evaluated loans at June 30, 2022
  • Recoveries exceeded charge-offs by $1.7 million in the second quarter
  • Other real estate totaled $3.0 million at June 30, 2022

Nonaccrual loans totaled $62.1 million at June 30, 2022, down $2.3 million from the prior quarter and up $10.6 million year-over-year. Other real estate totaled $3.0 million, reflecting a $153 thousand decrease from the prior quarter and decline of $6.4 million year-over-year. Collectively, nonperforming assets totaled $65.1 million at June 30, 2022, reflecting a linked-quarter decrease of $2.5 million and year-over-year increase of $4.2 million.

The provision for credit losses for loans HFI was $2.7 million in the second quarter. This provisioning was primarily driven by reserves related to loan growth and the nature and volume of the portfolio offset by improvements in macroeconomic forecasts. The provision for credit losses for off-balance sheet credit exposures was a negative $1.6 million in the second quarter. Off-balance sheet negative provision expense was primarily driven by improvements in macroeconomic forecasts. Collectively, the provision for credit losses totaled $1.1 million in the second quarter compared to a negative $2.0 million in the prior quarter and an expense of $537 thousand in the second quarter of 2021.

Allocation of Trustmark’s $103.1 million allowance for credit losses on loans HFI represented 0.88% of commercial loans and 1.14% of consumer and home mortgage loans, resulting in an allowance to total loans HFI of 0.94% at June 30, 2022. Management believes the level of the ACL is commensurate with the credit losses currently expected in the loan portfolio.

Revenue Generation

  • Total revenue increased $12.5 million, or 8.1%, linked-quarter
  • Net interest income (FTE) expanded $13.2 million, or 12.9%, linked-quarter
  • Noninterest income totaled $53.3 million, representing 32.1% of total revenue in the second quarter

Revenue in the second quarter totaled $165.9 million, an increase of $12.5 million, or 8.1%, from the prior quarter and a decrease of $9.9 million, or 5.6%, from the same quarter in the prior year. The linked-quarter increase reflected higher net interest income while the decline in revenue year-over-year was principally due to the reduction in interest and fees on Paycheck Protection Program (PPP) loans as well as the decline in mortgage banking revenue from historically high levels.

Net interest income (FTE) in the second quarter totaled $115.6 million, resulting in a net interest margin of 2.90%, up 32 basis points from the prior quarter. The net interest margin, excluding PPP loans and Federal Reserve Bank balance, totaled 3.06% during the second quarter, an increase of 18 basis points when compared to the prior quarter. The expansion of the net interest margin excluding PPP loans and the Federal Reserve Bank balance was due to increases in the yields on the loans held for investment and held for sale portfolio and the securities portfolio which resulted from the higher interest rate environment.

Noninterest income in the second quarter totaled $53.3 million, a decrease of $862 thousand from the prior quarter and $3.2 million year-over-year. The linked quarter decline was attributable to lower mortgage banking and other, net revenue, which were offset by increased bank card and other fees and service charges on deposit accounts. Mortgage loan production in the second quarter totaled $681.4 million, up 25.2% from the prior quarter and down 7.5% year-over-year. Mortgage banking revenue totaled $8.1 million in the second quarter, a decrease of $1.7 million from the prior quarter and $9.2 million year-over-year. The linked-quarter decline was principally attributable to changes in the mortgage servicing net hedge ineffectiveness.

Wealth management revenue totaled $9.1 million in the second quarter, an increase of $48 thousand, from the prior quarter and $156 thousand, year-over-year. The linked-quarter increase was attributable to increased trust and investment revenue offset by lower brokerage revenue. Insurance revenue totaled $13.7 million in the second quarter, down 2.7%, or $387 thousand, from the prior quarter and up 12.2%, or $1.5 million, year-over-year. Service charges on deposit accounts increased $775 thousand, or 8.2%, from the prior quarter and $2.6 million, or 34.3%, year-over-year. Bank card and other fees increased $1.7 million from the prior quarter and $1.9 million year-over-year.

Noninterest Expense

  • Noninterest expense totaled $123.8 million in the second quarter, up $2.2 million, or 1.8%, from the prior quarter
  • Adjusted noninterest expense, which excludes amortization of intangibles, ORE expenses and charitable contributions resulting in state tax credits, increased $1.8 million, or 1.5%, from the prior quarter; please refer to the Consolidated Financial Information, Note 6 – Non-GAAP Financial Measures

Noninterest expense in the second quarter was $123.8 million, up $2.2 million, or 1.8%, from the prior quarter. Salaries and employee benefits increased $2.1 million linked-quarter due primarily to commissions and annual merit increases. Services and fees were relatively unchanged linked-quarter while net occupancy expenses were down 2.6%.

FIT2GROW

“During the second quarter, we announced FIT2GROW, a comprehensive program of Focus, Innovation and Transformation designed to enhance Trustmark’s ability to grow and serve customers. As part of this program, we are focusing our community bank efforts on commercial, small business, and consumer lines of business. This will provide expertise and focus while also generating profitable revenue growth. We have opened a new Atlanta, Georgia LPO to focus on our institutional businesses, including Commercial Real Estate, Residential Real Estate, Corporate Banking and Specialty Banking. We have added seasoned professionals to our team to carry out our strategy in the southeast. Within our Specialty Banking unit based in Atlanta, plans are underway to establish an Equipment Finance line of business to focus on national, middle to large ticket business. We look forward to adding this product suite to our company,” said Dewey.

“Innovation is also a key component of FIT2GROW. In recent years, investments in state-of-the-art technology were made in Trustmark’s insurance, wealth management and mortgage banking areas as well as in human resources and accounting systems. We also made significant upgrades to our mobile banking platform, ITM network and digital marketing programs. Collectively, these investments have positioned Trustmark for growth, expansion and efficiency. More recently, we have been working toward the implementation of a new core banking system for consumer and commercial loans, deposits, and customer information. This implementation is a multi-year project, the next phase of which will occur in the third quarter of 2022. We have accelerated efforts to optimize our branch network, reflecting changing customer preferences and the continued migration to mobile and digital channels as announced in the first quarter. We will continue to pursue opportunities to redesign workflows and restructure the organization. This will further leverage the investments in technology, will broaden our reach, enhance customer experiences, and improve efficiency while building long-term value for our shareholders,” said Dewey.

Additional Information

As previously announced, Trustmark will conduct a conference call with analysts on Wednesday, July 27, 2022, at 8:30 a.m. Central Time to discuss the Corporation’s financial results. Interested parties may listen to the conference call by dialing (877) 317-3051 or by clicking on the link provided under the Investor Relations section of our website at www.trustmark.com. A replay of the conference call will also be available through Wednesday, August 10, 2022, in archived format at the same web address or by calling (877) 344-7529, passcode 1899156.

Trustmark is a financial services company providing banking and financial solutions through offices in Alabama, Florida, Georgia, Mississippi, Tennessee, and Texas.

Forward-Looking Statements

Certain statements contained in this document constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by words such as “may,” “hope,” “will,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “project,” “potential,” “seek,” “continue,” “could,” “would,” “future” or the negative of those terms or other words of similar meaning. You should read statements that contain these words carefully because they discuss our future expectations or state other “forward-looking” information. These forward-looking statements include, but are not limited to, statements relating to anticipated future operating and financial performance measures, including net interest margin, credit quality, business initiatives, growth opportunities and growth rates, among other things, and encompass any estimate, prediction, expectation, projection, opinion, anticipation, outlook or statement of belief included therein as well as the management assumptions underlying these forward-looking statements. You should be aware that the occurrence of the events described under the caption “Risk Factors” in Trustmark’s filings with the Securities and Exchange Commission (SEC) could have an adverse effect on our business, results of operations and financial condition. Should one or more of these risks materialize, or should any such underlying assumptions prove to be significantly different, actual results may vary significantly from those anticipated, estimated, projected or expected. Furthermore, many of these risks and uncertainties are currently amplified by and may continue to be amplified by or may, in the future, be amplified by, the novel coronavirus (COVID-19) pandemic, and also by the effectiveness of varying governmental responses in ameliorating the impact of the pandemic on our customers and the economies where they operate.

Risks that could cause actual results to differ materially from current expectations of Management include, but are not limited to, changes in the level of nonperforming assets and charge-offs, an increase in unemployment levels and slowdowns in economic growth, our ability to manage the impact of the COVID-19 pandemic on our markets, as well as the effectiveness of actions of federal, state and local governments and agencies (including the Board of Governors of the Federal Reserve System (FRB)) to mitigate its spread and economic impact, local, state and national economic and market conditions, conditions in the housing and real estate markets in the regions in which Trustmark operates and the extent and duration of the current volatility in the credit and financial markets, levels of and volatility in crude oil prices, changes in our ability to measure the fair value of assets in our portfolio, material changes in the level and/or volatility of market interest rates, the performance and demand for the products and services we offer, including the level and timing of withdrawals from our deposit accounts, the costs and effects of litigation and of unexpected or adverse outcomes in such litigation, our ability to attract noninterest-bearing deposits and other low-cost funds, competition in loan and deposit pricing, as well as the entry of new competitors into our markets through de novo expansion and acquisitions, economic conditions, including the potential impact of issues related to the European financial system and monetary and other governmental actions designed to address credit, securities, and/or commodity markets, the enactment of legislation and changes in existing regulations or enforcement practices or the adoption of new regulations, changes in accounting standards and practices, including changes in the interpretation of existing standards, that affect our consolidated financial statements, changes in consumer spending, borrowings and savings habits, technological changes, changes in the financial performance or condition of our borrowers, changes in our ability to control expenses, greater than expected costs or difficulties related to the integration of acquisitions or new products and lines of business, cyber-attacks and other breaches which could affect our information system security, natural disasters, environmental disasters, pandemics or other health crises, acts of war or terrorism, and other risks described in our filings with the SEC.

Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Except as required by law, we undertake no obligation to update or revise any of this information, whether as the result of new information, future events or developments or otherwise.

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2022
($ in thousands)
(unaudited)
Linked Quarter Year over Year
QUARTERLY AVERAGE BALANCES 6/30/2022 3/31/2022 6/30/2021 $ Change % Change $ Change % Change
Securities AFS-taxable (1)

$

3,094,364

 

$

3,245,502

 

$

2,339,662

 

$

(151,138

)

-4.7

%

$

754,702

 

32.3

%

Securities AFS-nontaxable

 

5,110

 

 

5,127

 

 

5,174

 

 

(17

)

-0.3

%

 

(64

)

-1.2

%

Securities HTM-taxable (1)

 

811,599

 

 

410,851

 

 

441,688

 

 

400,748

 

97.5

%

 

369,911

 

83.7

%

Securities HTM-nontaxable

 

5,630

 

 

7,327

 

 

10,958

 

 

(1,697

)

-23.2

%

 

(5,328

)

-48.6

%

Total securities

 

3,916,703

 

 

3,668,807

 

 

2,797,482

 

 

247,896

 

6.8

%

 

1,119,221

 

40.0

%

Paycheck protection program loans (PPP)

 

17,746

 

 

29,009

 

 

648,222

 

 

(11,263

)

-38.8

%

 

(630,476

)

-97.3

%

Loans (includes loans held for sale)

 

10,910,178

 

 

10,550,712

 

 

10,315,927

 

 

359,466

 

3.4

%

 

594,251

 

5.8

%

Fed funds sold and reverse repurchases

 

110

 

 

56

 

 

55

 

 

54

 

96.4

%

 

55

 

100.0

%

Other earning assets

 

1,139,312

 

 

1,811,713

 

 

1,750,385

 

 

(672,401

)

-37.1

%

 

(611,073

)

-34.9

%

Total earning assets

 

15,984,049

 

 

16,060,297

 

 

15,512,071

 

 

(76,248

)

-0.5

%

 

471,978

 

3.0

%

Allowance for credit losses (ACL), loans held for investment (LHFI)

 

(99,106

)

 

(99,390

)

 

(112,346

)

 

284

 

-0.3

%

 

13,240

 

-11.8

%

Other assets

 

1,513,127

 

 

1,550,848

 

 

1,622,388

 

 

(37,721

)

-2.4

%

 

(109,261

)

-6.7

%

Total assets

$

17,398,070

 

$

17,511,755

 

$

17,022,113

 

$

(113,685

)

-0.6

%

$

375,957

 

2.2

%

 
Interest-bearing demand deposits

$

4,578,235

 

$

4,429,056

 

$

4,056,910

 

$

149,179

 

3.4

%

$

521,325

 

12.9

%

Savings deposits

 

4,638,849

 

 

4,791,104

 

 

4,627,180

 

 

(152,255

)

-3.2

%

 

11,669

 

0.3

%

Time deposits

 

1,159,065

 

 

1,193,435

 

 

1,301,896

 

 

(34,370

)

-2.9

%

 

(142,831

)

-11.0

%

Total interest-bearing deposits

 

10,376,149

 

 

10,413,595

 

 

9,985,986

 

 

(37,446

)

-0.4

%

 

390,163

 

3.9

%

Fed funds purchased and repurchases

 

118,753

 

 

212,006

 

 

174,620

 

 

(93,253

)

-44.0

%

 

(55,867

)

-32.0

%

Other borrowings

 

80,283

 

 

91,090

 

 

132,199

 

 

(10,807

)

-11.9

%

 

(51,916

)

-39.3

%

Subordinated notes

 

123,116

 

 

123,061

 

 

122,897

 

 

55

 

0.0

%

 

219

 

0.2

%

Junior subordinated debt securities

 

61,856

 

 

61,856

 

 

61,856

 

 

 

0.0

%

 

 

0.0

%

Total interest-bearing liabilities

 

10,760,157

 

 

10,901,608

 

 

10,477,558

 

 

(141,451

)

-1.3

%

 

282,599

 

2.7

%

Noninterest-bearing deposits

 

4,590,338

 

 

4,601,108

 

 

4,512,268

 

 

(10,770

)

-0.2

%

 

78,070

 

1.7

%

Other liabilities

 

439,266

 

 

295,287

 

 

251,582

 

 

143,979

 

48.8

%

 

187,684

 

74.6

%

Total liabilities

 

15,789,761

 

 

15,798,003

 

 

15,241,408

 

 

(8,242

)

-0.1

%

 

548,353

 

3.6

%

Shareholders' equity

 

1,608,309

 

 

1,713,752

 

 

1,780,705

 

 

(105,443

)

-6.2

%

 

(172,396

)

-9.7

%

Total liabilities and equity

$

17,398,070

 

$

17,511,755

 

$

17,022,113

 

$

(113,685

)

-0.6

%

$

375,957

 

2.2

%

 

(1)

During the second quarter of 2022, Trustmark transferred $343.1 million of securities available for sale to securities held to maturity.

 

See Note 1 - Securities Available for Sale and Held to Maturity in the Notes to Consolidated Financials for additional information.

 

 

n/m - percentage changes greater than +/- 100% are considered not meaningful

 
See Notes to Consolidated Financials
 
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2022
($ in thousands)
(unaudited)
 
Linked Quarter Year over Year
PERIOD END BALANCES 6/30/2022 3/31/2022 6/30/2021 $ Change % Change $ Change % Change
Cash and due from banks

$

742,461

 

$

1,917,564

 

$

2,267,224

 

$

(1,175,103

)

-61.3

%

$

(1,524,763

)

-67.3

%

Securities available for sale (1)

 

2,644,364

 

 

3,018,246

 

 

2,548,739

 

 

(373,882

)

-12.4

%

 

95,625

 

3.8

%

Securities held to maturity (1)

 

1,137,754

 

 

607,598

 

 

433,012

 

 

530,156

 

87.3

%

 

704,742

 

n/m

 

PPP loans

 

12,549

 

 

18,579

 

 

166,119

 

 

(6,030

)

-32.5

%

 

(153,570

)

-92.4

%

Loans held for sale (LHFS)

 

190,186

 

 

222,538

 

 

332,132

 

 

(32,352

)

-14.5

%

 

(141,946

)

-42.7

%

Loans held for investment (LHFI)

 

10,944,840

 

 

10,397,129

 

 

10,152,869

 

 

547,711

 

5.3

%

 

791,971

 

7.8

%

ACL LHFI

 

(103,140

)

 

(98,734

)

 

(104,032

)

 

(4,406

)

-4.5

%

 

892

 

0.9

%

Net LHFI

 

10,841,700

 

 

10,298,395

 

 

10,048,837

 

 

543,305

 

5.3

%

 

792,863

 

7.9

%

Premises and equipment, net

 

207,914

 

 

207,301

 

 

200,970

 

 

613

 

0.3

%

 

6,944

 

3.5

%

Mortgage servicing rights

 

121,014

 

 

111,050

 

 

80,764

 

 

9,964

 

9.0

%

 

40,250

 

49.8

%

Goodwill

 

384,237

 

 

384,237

 

 

384,237

 

 

 

0.0

%

 

 

0.0

%

Identifiable intangible assets

 

4,264

 

 

4,591

 

 

6,170

 

 

(327

)

-7.1

%

 

(1,906

)

-30.9

%

Other real estate

 

3,034

 

 

3,187

 

 

9,439

 

 

(153

)

-4.8

%

 

(6,405

)

-67.9

%

Operating lease right-of-use assets

 

34,684

 

 

34,048

 

 

33,201

 

 

636

 

1.9

%

 

1,483

 

4.5

%

Other assets

 

627,349

 

 

614,217

 

 

587,288

 

 

13,132

 

2.1

%

 

40,061

 

6.8

%

Total assets

$

16,951,510

 

$

17,441,551

 

$

17,098,132

 

$

(490,041

)

-2.8

%

$

(146,622

)

-0.9

%

 
Deposits:
Noninterest-bearing

$

4,509,472

 

$

4,739,102

 

$

4,446,991

 

$

(229,630

)

-4.8

%

$

62,481

 

1.4

%

Interest-bearing

 

10,260,696

 

 

10,374,190

 

 

10,185,093

 

 

(113,494

)

-1.1

%

 

75,603

 

0.7

%

Total deposits

 

14,770,168

 

 

15,113,292

 

 

14,632,084

 

 

(343,124

)

-2.3

%

 

138,084

 

0.9

%

Fed funds purchased and repurchases

 

70,157

 

 

170,499

 

 

157,176

 

 

(100,342

)

-58.9

%

 

(87,019

)

-55.4

%

Other borrowings

 

72,553

 

 

84,644

 

 

117,223

 

 

(12,091

)

-14.3

%

 

(44,670

)

-38.1

%

Subordinated notes

 

123,152

 

 

123,097

 

 

122,932

 

 

55

 

0.0

%

 

220

 

0.2

%

Junior subordinated debt securities

 

61,856

 

 

61,856

 

 

61,856

 

 

 

0.0

%

 

 

0.0

%

ACL on off-balance sheet credit exposures

 

32,949

 

 

34,517

 

 

33,733

 

 

(1,568

)

-4.5

%

 

(784

)

-2.3

%

Operating lease liabilities

 

37,108

 

 

35,912

 

 

34,959

 

 

1,196

 

3.3

%

 

2,149

 

6.1

%

Other liabilities

 

196,871

 

 

186,352

 

 

158,860

 

 

10,519

 

5.6

%

 

38,011

 

23.9

%

Total liabilities

 

15,364,814

 

 

15,810,169

 

 

15,318,823

 

 

(445,355

)

-2.8

%

 

45,991

 

0.3

%

Common stock

 

12,752

 

 

12,806

 

 

13,079

 

 

(54

)

-0.4

%

 

(327

)

-2.5

%

Capital surplus

 

160,876

 

 

167,094

 

 

210,420

 

 

(6,218

)

-3.7

%

 

(49,544

)

-23.5

%

Retained earnings

 

1,620,210

 

 

1,600,138

 

 

1,566,451

 

 

20,072

 

1.3

%

 

53,759

 

3.4

%

Accumulated other comprehensive income (loss), net of tax

 

(207,142

)

 

(148,656

)

 

(10,641

)

 

(58,486

)

-39.3

%

 

(196,501

)

n/m

 

Total shareholders' equity

 

1,586,696

 

 

1,631,382

 

 

1,779,309

 

 

(44,686

)

-2.7

%

 

(192,613

)

-10.8

%

Total liabilities and equity

$

16,951,510

 

$

17,441,551

 

$

17,098,132

 

$

(490,041

)

-2.8

%

$

(146,622

)

-0.9

%

 

(1)

During the second quarter of 2022, Trustmark transferred $343.1 million of securities available for sale to securities held to maturity.

 

See Note 1 - Securities Available for Sale and Held to Maturity in the Notes to Consolidated Financials for additional information.

 

 

n/m - percentage changes greater than +/- 100% are considered not meaningful

 
See Notes to Consolidated Financials
 
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2022
($ in thousands except per share data)
(unaudited)
 
Quarter Ended Linked Quarter Year over Year
INCOME STATEMENTS 6/30/2022 3/31/2022 6/30/2021 $ Change % Change $ Change % Change
Interest and fees on LHFS & LHFI-FTE

$

103,033

 

$

93,252

 

$

93,698

 

$

9,781

 

10.5

%

$

9,335

 

10.0

%

Interest and fees on PPP loans

 

184

 

 

168

 

 

25,555

 

 

16

 

9.5

%

 

(25,371

)

-99.3

%

Interest on securities-taxable

 

14,561

 

 

12,357

 

 

8,991

 

 

2,204

 

17.8

%

 

5,570

 

62.0

%

Interest on securities-tax exempt-FTE

 

107

 

 

122

 

 

149

 

 

(15

)

-12.3

%

 

(42

)

-28.2

%

Interest on fed funds sold and reverse repurchases

 

1

 

 

 

 

 

 

1

 

n/m

 

 

1

 

n/m

 

Other interest income

 

2,214

 

 

817

 

 

489

 

 

1,397

 

n/m

 

 

1,725

 

n/m

 

Total interest income-FTE

 

120,100

 

 

106,716

 

 

128,882

 

 

13,384

 

12.5

%

 

(8,782

)

-6.8

%

Interest on deposits

 

2,774

 

 

2,760

 

 

4,630

 

 

14

 

0.5

%

 

(1,856

)

-40.1

%

Interest on fed funds purchased and repurchases

 

70

 

 

70

 

 

59

 

 

 

0.0

%

 

11

 

18.6

%

Other interest expense

 

1,664

 

 

1,539

 

 

1,813

 

 

125

 

8.1

%

 

(149

)

-8.2

%

Total interest expense

 

4,508

 

 

4,369

 

 

6,502

 

 

139

 

3.2

%

 

(1,994

)

-30.7

%

Net interest income-FTE

 

115,592

 

 

102,347

 

 

122,380

 

 

13,245

 

12.9

%

 

(6,788

)

-5.5

%

Provision for credit losses, LHFI

 

2,716

 

 

(860

)

 

(3,991

)

 

3,576

 

n/m

 

 

6,707

 

n/m

 

Provision for credit losses, off-balance sheet credit exposures

 

(1,568

)

 

(1,106

)

 

4,528

 

 

(462

)

-41.8

%

 

(6,096

)

n/m

 

Net interest income after provision-FTE

 

114,444

 

 

104,313

 

 

121,843

 

 

10,131

 

9.7

%

 

(7,399

)

-6.1

%

Service charges on deposit accounts

 

10,226

 

 

9,451

 

 

7,613

 

 

775

 

8.2

%

 

2,613

 

34.3

%

Bank card and other fees

 

10,167

 

 

8,442

 

 

8,301

 

 

1,725

 

20.4

%

 

1,866

 

22.5

%

Mortgage banking, net

 

8,149

 

 

9,873

 

 

17,333

 

 

(1,724

)

-17.5

%

 

(9,184

)

-53.0

%

Insurance commissions

 

13,702

 

 

14,089

 

 

12,217

 

 

(387

)

-2.7

%

 

1,485

 

12.2

%

Wealth management

 

9,102

 

 

9,054

 

 

8,946

 

 

48

 

0.5

%

 

156

 

1.7

%

Other, net

 

1,907

 

 

3,206

 

 

2,001

 

 

(1,299

)

-40.5

%

 

(94

)

-4.7

%

Total noninterest income

 

53,253

 

 

54,115

 

 

56,411

 

 

(862

)

-1.6

%

 

(3,158

)

-5.6

%

Salaries and employee benefits

 

71,679

 

 

69,585

 

 

70,115

 

 

2,094

 

3.0

%

 

1,564

 

2.2

%

Services and fees

 

24,538

 

 

24,453

 

 

21,769

 

 

85

 

0.3

%

 

2,769

 

12.7

%

Net occupancy-premises

 

6,892

 

 

7,079

 

 

6,578

 

 

(187

)

-2.6

%

 

314

 

4.8

%

Equipment expense

 

6,047

 

 

6,061

 

 

5,567

 

 

(14

)

-0.2

%

 

480

 

8.6

%

Other expense

 

14,611

 

 

14,341

 

 

14,650

 

 

270

 

1.9

%

 

(39

)

-0.3

%

Total noninterest expense

 

123,767

 

 

121,519

 

 

118,679

 

 

2,248

 

1.8

%

 

5,088

 

4.3

%

Income before income taxes and tax eq adj

 

43,930

 

 

36,909

 

 

59,575

 

 

7,021

 

19.0

%

 

(15,645

)

-26.3

%

Tax equivalent adjustment

 

2,916

 

 

3,003

 

 

2,957

 

 

(87

)

-2.9

%

 

(41

)

-1.4

%

Income before income taxes

 

41,014

 

 

33,906

 

 

56,618

 

 

7,108

 

21.0

%

 

(15,604

)

-27.6

%

Income taxes

 

6,730

 

 

4,695

 

 

8,637

 

 

2,035

 

43.3

%

 

(1,907

)

-22.1

%

Net income

$

34,284

 

$

29,211

 

$

47,981

 

$

5,073

 

17.4

%

$

(13,697

)

-28.5

%

 
Per share data
Earnings per share - basic

$

0.56

 

$

0.47

 

$

0.76

 

$

0.09

 

19.1

%

$

(0.20

)

-26.3

%

 
Earnings per share - diluted

$

0.56

 

$

0.47

 

$

0.76

 

$

0.09

 

19.1

%

$

(0.20

)

-26.3

%

 
Dividends per share

$

0.23

 

$

0.23

 

$

0.23

 

 

 

0.0

%

 

 

0.0

%

 
Weighted average shares outstanding
Basic

 

61,378,226

 

 

61,514,395

 

 

63,214,593

 

 
Diluted

 

61,546,285

 

 

61,709,797

 

 

63,409,683

 

 
Period end shares outstanding

 

61,201,123

 

 

61,463,392

 

 

62,773,226

 

 
n/m - percentage changes greater than +/- 100% are considered not meaningful
 
See Notes to Consolidated Financials
 
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2022
($ in thousands)
(unaudited)
 
Quarter Ended Linked Quarter Year over Year
NONPERFORMING ASSETS (1) 6/30/2022 3/31/2022 6/30/2021 $ Change % Change $ Change % Change
Nonaccrual LHFI
Alabama

$

2,698

 

$

7,506

 

$

8,952

 

$

(4,808

)

-64.1

%

$

(6,254

)

-69.9

%

Florida

 

233

 

 

310

 

 

467

 

 

(77

)

-24.8

%

 

(234

)

-50.1

%

Mississippi (2)

 

23,039

 

 

21,318

 

 

23,422

 

 

1,721

 

8.1

%

 

(383

)

-1.6

%

Tennessee (3)

 

9,500

 

 

9,266

 

 

10,751

 

 

234

 

2.5

%

 

(1,251

)

-11.6

%

Texas

 

26,582

 

 

25,999

 

 

7,856

 

 

583

 

2.2

%

 

18,726

 

n/m

 

Total nonaccrual LHFI

 

62,052

 

 

64,399

 

 

51,448

 

 

(2,347

)

-3.6

%

 

10,604

 

20.6

%

Other real estate
Alabama

 

84

 

 

 

 

2,830

 

 

84

 

n/m

 

 

(2,746

)

-97.0

%

Mississippi (2)

 

2,950

 

 

3,187

 

 

6,550

 

 

(237

)

-7.4

%

 

(3,600

)

-55.0

%

Tennessee (3)

 

 

 

 

 

59

 

 

 

n/m

 

 

(59

)

n/m

 

Total other real estate

 

3,034

 

 

3,187

 

 

9,439

 

 

(153

)

-4.8

%

 

(6,405

)

-67.9

%

Total nonperforming assets

$

65,086

 

$

67,586

 

$

60,887

 

$

(2,500

)

-3.7

%

$

4,199

 

6.9

%

 
LOANS PAST DUE OVER 90 DAYS (1)
LHFI

$

1,347

 

$

1,503

 

$

423

 

$

(156

)

-10.4

%

$

924

 

n/m

 

 
LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase)

$

51,164

 

$

62,078

 

$

81,538

 

$

(10,914

)

-17.6

%

$

(30,374

)

-37.3

%

 
Quarter Ended Linked Quarter Year over Year
ACL LHFI (1) 6/30/2022 3/31/2022 6/30/2021 $ Change % Change $ Change % Change
Beginning Balance

$

98,734

 

$

99,457

 

$

109,191

 

$

(723

)

-0.7

%

$

(10,457

)

-9.6

%

Provision for credit losses, LHFI

 

2,716

 

 

(860

)

 

(3,991

)

 

3,576

 

n/m

 

 

6,707

 

n/m

 

Charge-offs

 

(2,277

)

 

(2,242

)

 

(4,828

)

 

(35

)

-1.6

%

 

2,551

 

52.8

%

Recoveries

 

3,967

 

 

2,379

 

 

3,660

 

 

1,588

 

66.8

%

 

307

 

8.4

%

Net (charge-offs) recoveries

 

1,690

 

 

137

 

 

(1,168

)

 

1,553

 

n/m

 

 

2,858

 

n/m

 

Ending Balance

$

103,140

 

$

98,734

 

$

104,032

 

$

4,406

 

4.5

%

$

(892

)

-0.9

%

 
NET (CHARGE-OFFS) RECOVERIES (1)
Alabama

$

1,129

 

$

699

 

$

203

 

$

430

 

61.5

%

$

926

 

n/m

 

Florida

 

761

 

 

(26

)

 

167

 

 

787

 

n/m

 

 

594

 

n/m

 

Mississippi (2)

 

(266

)

 

(88

)

 

(3,071

)

 

(178

)

n/m

 

 

2,805

 

-91.3

%

Tennessee (3)

 

31

 

 

(424

)

 

1,031

 

 

455

 

n/m

 

 

(1,000

)

-97.0

%

Texas

 

35

 

 

(24

)

 

502

 

 

59

 

n/m

 

 

(467

)

-93.0

%

Total net (charge-offs) recoveries

$

1,690

 

$

137

 

$

(1,168

)

$

1,553

 

n/m

 

$

2,858

 

n/m

 

 

(1)

Excludes PPP loans.

(2)

Mississippi includes Central and Southern Mississippi Regions.

(3)

Tennessee includes Memphis, Tennessee and Northern Mississippi Regions.

 

 

n/m - percentage changes greater than +/- 100% are considered not meaningful

 
See Notes to Consolidated Financials
 
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2022
($ in thousands)
(unaudited)
Quarter Ended Six Months Ended
AVERAGE BALANCES 6/30/2022 3/31/2022 12/31/2021 9/30/2021 6/30/2021 6/30/2022 6/30/2021
Securities AFS-taxable (1)

$

3,094,364

 

$

3,245,502

 

$

3,156,740

 

$

2,686,765

 

$

2,339,662

 

$

3,169,515

 

$

2,219,543

 

Securities AFS-nontaxable

 

5,110

 

 

5,127

 

 

5,143

 

 

5,159

 

 

5,174

 

 

5,118

 

 

5,182

 

Securities HTM-taxable (1)

 

811,599

 

 

410,851

 

 

364,038

 

 

401,685

 

 

441,688

 

 

612,332

 

 

465,343

 

Securities HTM-nontaxable

 

5,630

 

 

7,327

 

 

7,618

 

 

8,641

 

 

10,958

 

 

6,474

 

 

17,478

 

Total securities

 

3,916,703

 

 

3,668,807

 

 

3,533,539

 

 

3,102,250

 

 

2,797,482

 

 

3,793,439

 

 

2,707,546

 

PPP loans

 

17,746

 

 

29,009

 

 

42,749

 

 

122,176

 

 

648,222

 

 

23,346

 

 

623,319

 

Loans (includes loans held for sale)

 

10,910,178

 

 

10,550,712

 

 

10,487,679

 

 

10,389,826

 

 

10,315,927

 

 

10,731,438

 

 

10,316,122

 

Fed funds sold and reverse repurchases

 

110

 

 

56

 

 

58

 

 

69

 

 

55

 

 

83

 

 

95

 

Other earning assets

 

1,139,312

 

 

1,811,713

 

 

1,839,498

 

 

2,038,515

 

 

1,750,385

 

 

1,473,655

 

 

1,709,373

 

Total earning assets

 

15,984,049

 

 

16,060,297

 

 

15,903,523

 

 

15,652,836

 

 

15,512,071

 

 

16,021,961

 

 

15,356,455

 

ACL LHFI

 

(99,106

)

 

(99,390

)

 

(104,148

)

 

(104,857

)

 

(112,346

)

 

(99,247

)

 

(115,932

)

Other assets

 

1,513,127

 

 

1,550,848

 

 

1,570,501

 

 

1,602,611

 

 

1,622,388

 

 

1,531,884

 

 

1,611,877

 

Total assets

$

17,398,070

 

$

17,511,755

 

$

17,369,876

 

$

17,150,590

 

$

17,022,113

 

$

17,454,598

 

$

16,852,400

 

 
Interest-bearing demand deposits

$

4,578,235

 

$

4,429,056

 

$

4,353,599

 

$

4,224,717

 

$

4,056,910

 

$

4,504,058

 

$

3,901,146

 

Savings deposits

 

4,638,849

 

 

4,791,104

 

 

4,585,624

 

 

4,617,683

 

 

4,627,180

 

 

4,714,556

 

 

4,643,020

 

Time deposits

 

1,159,065

 

 

1,193,435

 

 

1,220,083

 

 

1,258,829

 

 

1,301,896

 

 

1,176,155

 

 

1,336,670

 

Total interest-bearing deposits

 

10,376,149

 

 

10,413,595

 

 

10,159,306

 

 

10,101,229

 

 

9,985,986

 

 

10,394,769

 

 

9,880,836

 

Fed funds purchased and repurchases

 

118,753

 

 

212,006

 

 

201,856

 

 

147,635

 

 

174,620

 

 

165,122

 

 

170,786

 

Other borrowings

 

80,283

 

 

91,090

 

 

94,328

 

 

109,735

 

 

132,199

 

 

85,657

 

 

149,467

 

Subordinated notes

 

123,116

 

 

123,061

 

 

123,007

 

 

122,951

 

 

122,897

 

 

123,089

 

 

122,886

 

Junior subordinated debt securities

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

Total interest-bearing liabilities

 

10,760,157

 

 

10,901,608

 

 

10,640,353

 

 

10,543,406

 

 

10,477,558

 

 

10,830,493

 

 

10,385,831

 

Noninterest-bearing deposits

 

4,590,338

 

 

4,601,108

 

 

4,679,951

 

 

4,566,924

 

 

4,512,268

 

 

4,595,693

 

 

4,438,324

 

Other liabilities

 

439,266

 

 

295,287

 

 

291,449

 

 

257,956

 

 

251,582

 

 

367,673

 

 

258,158

 

Total liabilities

 

15,789,761

 

 

15,798,003

 

 

15,611,753

 

 

15,368,286

 

 

15,241,408

 

 

15,793,859

 

 

15,082,313

 

Shareholders' equity

 

1,608,309

 

 

1,713,752

 

 

1,758,123

 

 

1,782,304

 

 

1,780,705

 

 

1,660,739

 

 

1,770,087

 

Total liabilities and equity

$

17,398,070

 

$

17,511,755

 

$

17,369,876

 

$

17,150,590

 

$

17,022,113

 

$

17,454,598

 

$

16,852,400

 

 

(1)

During the second quarter of 2022, Trustmark transferred $343.1 million of securities available for sale to securities held to maturity.

 

See Note 1 - Securities Available for Sale and Held to Maturity in the Notes to Consolidated Financials for additional information.

 
See Notes to Consolidated Financials
 
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2022
($ in thousands)
(unaudited)
 
 
PERIOD END BALANCES 6/30/2022 3/31/2022 12/31/2021 9/30/2021 6/30/2021
Cash and due from banks

$

742,461

 

$

1,917,564

 

$

2,266,829

 

$

2,175,058

 

$

2,267,224

 

Securities available for sale (1)

 

2,644,364

 

 

3,018,246

 

 

3,238,877

 

 

3,057,605

 

 

2,548,739

 

Securities held to maturity (1)

 

1,137,754

 

 

607,598

 

 

342,537

 

 

394,905

 

 

433,012

 

PPP loans

 

12,549

 

 

18,579

 

 

33,336

 

 

46,486

 

 

166,119

 

LHFS

 

190,186

 

 

222,538

 

 

275,706

 

 

335,339

 

 

332,132

 

LHFI

 

10,944,840

 

 

10,397,129

 

 

10,247,829

 

 

10,174,899

 

 

10,152,869

 

ACL LHFI

 

(103,140

)

 

(98,734

)

 

(99,457

)

 

(104,073

)

 

(104,032

)

Net LHFI

 

10,841,700

 

 

10,298,395

 

 

10,148,372

 

 

10,070,826

 

 

10,048,837

 

Premises and equipment, net

 

207,914

 

 

207,301

 

 

205,644

 

 

201,937

 

 

200,970

 

Mortgage servicing rights

 

121,014

 

 

111,050

 

 

87,687

 

 

84,101

 

 

80,764

 

Goodwill

 

384,237

 

 

384,237

 

 

384,237

 

 

384,237

 

 

384,237

 

Identifiable intangible assets

 

4,264

 

 

4,591

 

 

5,074

 

 

5,621

 

 

6,170

 

Other real estate

 

3,034

 

 

3,187

 

 

4,557

 

 

6,213

 

 

9,439

 

Operating lease right-of-use assets

 

34,684

 

 

34,048

 

 

34,603

 

 

34,689

 

 

33,201

 

Other assets

 

627,349

 

 

614,217

 

 

568,177

 

 

567,627

 

 

587,288

 

Total assets

$

16,951,510

 

$

17,441,551

 

$

17,595,636

 

$

17,364,644

 

$

17,098,132

 

 
Deposits:
Noninterest-bearing

$

4,509,472

 

$

4,739,102

 

$

4,771,065

 

$

4,987,885

 

$

4,446,991

 

Interest-bearing

 

10,260,696

 

 

10,374,190

 

 

10,316,095

 

 

9,934,954

 

 

10,185,093

 

Total deposits

 

14,770,168

 

 

15,113,292

 

 

15,087,160

 

 

14,922,839

 

 

14,632,084

 

Fed funds purchased and repurchases

 

70,157

 

 

170,499

 

 

238,577

 

 

146,417

 

 

157,176

 

Other borrowings

 

72,553

 

 

84,644

 

 

91,025

 

 

94,889

 

 

117,223

 

Subordinated notes

 

123,152

 

 

123,097

 

 

123,042

 

 

122,987

 

 

122,932

 

Junior subordinated debt securities

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

ACL on off-balance sheet credit exposures

 

32,949

 

 

34,517

 

 

35,623

 

 

32,684

 

 

33,733

 

Operating lease liabilities

 

37,108

 

 

35,912

 

 

36,468

 

 

36,531

 

 

34,959

 

Other liabilities

 

196,871

 

 

186,352

 

 

180,574

 

 

177,494

 

 

158,860

 

Total liabilities

 

15,364,814

 

 

15,810,169

 

 

15,854,325

 

 

15,595,697

 

 

15,318,823

 

Common stock

 

12,752

 

 

12,806

 

 

12,845

 

 

13,014

 

 

13,079

 

Capital surplus

 

160,876

 

 

167,094

 

 

175,913

 

 

201,837

 

 

210,420

 

Retained earnings

 

1,620,210

 

 

1,600,138

 

 

1,585,113

 

 

1,573,176

 

 

1,566,451

 

Accumulated other comprehensive income (loss), net of tax

 

(207,142

)

 

(148,656

)

 

(32,560

)

 

(19,080

)

 

(10,641

)

Total shareholders' equity

 

1,586,696

 

 

1,631,382

 

 

1,741,311

 

 

1,768,947

 

 

1,779,309

 

Total liabilities and equity

$

16,951,510

 

$

17,441,551

 

$

17,595,636

 

$

17,364,644

 

$

17,098,132

 

 

(1)

During the second quarter of 2022, Trustmark transferred $343.1 million of securities available for sale to securities held to maturity.

 

See Note 1 - Securities Available for Sale and Held to Maturity in the Notes to Consolidated Financials for additional information.

 
See Notes to Consolidated Financials
 
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2022
($ in thousands except per share data)
(unaudited)
 
 
Quarter Ended Six Months Ended
INCOME STATEMENTS 6/30/2022 3/31/2022 12/31/2021 9/30/2021 6/30/2021 6/30/2022 6/30/2021
Interest and fees on LHFS & LHFI-FTE

$

103,033

 

$

93,252

 

$

94,137

 

$

94,101

 

$

93,698

 

$

196,285

 

$

187,092

 

Interest and fees on PPP loans

 

184

 

 

168

 

 

397

 

 

1,533

 

 

25,555

 

 

352

 

 

34,796

 

Interest on securities-taxable

 

14,561

 

 

12,357

 

 

10,796

 

 

9,973

 

 

8,991

 

 

26,918

 

 

17,929

 

Interest on securities-tax exempt-FTE

 

107

 

 

122

 

 

123

 

 

132

 

 

149

 

 

229

 

 

439

 

Interest on fed funds sold and reverse repurchases

 

1

 

 

 

 

 

 

 

 

 

 

1

 

 

 

Other interest income

 

2,214

 

 

817

 

 

826

 

 

949

 

 

489

 

 

3,031

 

 

992

 

Total interest income-FTE

 

120,100

 

 

106,716

 

 

106,279

 

 

106,688

 

 

128,882

 

 

226,816

 

 

241,248

 

Interest on deposits

 

2,774

 

 

2,760

 

 

3,401

 

 

3,691

 

 

4,630

 

 

5,534

 

 

9,853

 

Interest on fed funds purchased and repurchases

 

70

 

 

70

 

 

66

 

 

51

 

 

59

 

 

140

 

 

115

 

Other interest expense

 

1,664

 

 

1,539

 

 

1,580

 

 

1,733

 

 

1,813

 

 

3,203

 

 

3,670

 

Total interest expense

 

4,508

 

 

4,369

 

 

5,047

 

 

5,475

 

 

6,502

 

 

8,877

 

 

13,638

 

Net interest income-FTE

 

115,592

 

 

102,347

 

 

101,232

 

 

101,213

 

 

122,380

 

 

217,939

 

 

227,610

 

Provision for credit losses, LHFI

 

2,716

 

 

(860

)

 

(4,515

)

 

(2,492

)

 

(3,991

)

 

1,856

 

 

(14,492

)

Provision for credit losses, off-balance sheet credit exposures

 

(1,568

)

 

(1,106

)

 

2,939

 

 

(1,049

)

 

4,528

 

 

(2,674

)

 

(4,839

)

Net interest income after provision-FTE

 

114,444

 

 

104,313

 

 

102,808

 

 

104,754

 

 

121,843

 

 

218,757

 

 

246,941

 

Service charges on deposit accounts

 

10,226

 

 

9,451

 

 

9,366

 

 

8,911

 

 

7,613

 

 

19,677

 

 

14,969

 

Bank card and other fees

 

10,167

 

 

8,442

 

 

8,340

 

 

8,549

 

 

8,301

 

 

18,609

 

 

17,773

 

Mortgage banking, net

 

8,149

 

 

9,873

 

 

11,609

 

 

14,004

 

 

17,333

 

 

18,022

 

 

38,137

 

Insurance commissions

 

13,702

 

 

14,089

 

 

11,716

 

 

12,133

 

 

12,217

 

 

27,791

 

 

24,662

 

Wealth management

 

9,102

 

 

9,054

 

 

8,757

 

 

9,071

 

 

8,946

 

 

18,156

 

 

17,362

 

Other, net

 

1,907

 

 

3,206

 

 

979

 

 

1,481

 

 

2,001

 

 

5,113

 

 

4,091

 

Total noninterest income

 

53,253

 

 

54,115

 

 

50,767

 

 

54,149

 

 

56,411

 

 

107,368

 

 

116,994

 

Salaries and employee benefits

 

71,679

 

 

69,585

 

 

68,258

 

 

74,623

 

 

70,115

 

 

141,264

 

 

141,277

 

Services and fees

 

24,538

 

 

24,453

 

 

22,904

 

 

22,306

 

 

21,769

 

 

48,991

 

 

44,253

 

Net occupancy-premises

 

6,892

 

 

7,079

 

 

6,816

 

 

6,854

 

 

6,578

 

 

13,971

 

 

13,373

 

Equipment expense

 

6,047

 

 

6,061

 

 

6,585

 

 

5,941

 

 

5,567

 

 

12,108

 

 

11,811

 

Other expense

 

14,611

 

 

14,341

 

 

14,906

 

 

19,876

 

 

14,650

 

 

28,952

 

 

29,513

 

Total noninterest expense

 

123,767

 

 

121,519

 

 

119,469

 

 

129,600

 

 

118,679

 

 

245,286

 

 

240,227

 

Income before income taxes and tax eq adj

 

43,930

 

 

36,909

 

 

34,106

 

 

29,303

 

 

59,575

 

 

80,839

 

 

123,708

 

Tax equivalent adjustment

 

2,916

 

 

3,003

 

 

2,906

 

 

2,947

 

 

2,957

 

 

5,919

 

 

5,851

 

Income before income taxes

 

41,014

 

 

33,906

 

 

31,200

 

 

26,356

 

 

56,618

 

 

74,920

 

 

117,857

 

Income taxes

 

6,730

 

 

4,695

 

 

4,978

 

 

5,156

 

 

8,637

 

 

11,425

 

 

17,914

 

Net income

$

34,284

 

$

29,211

 

$

26,222

 

$

21,200

 

$

47,981

 

$

63,495

 

$

99,943

 

 
Per share data
Earnings per share - basic

$

0.56

 

$

0.47

 

$

0.42

 

$

0.34

 

$

0.76

 

$

1.03

 

$

1.58

 

 
Earnings per share - diluted

$

0.56

 

$

0.47

 

$

0.42

 

$

0.34

 

$

0.76

 

$

1.03

 

$

1.57

 

 
Dividends per share

$

0.23

 

$

0.23

 

$

0.23

 

$

0.23

 

$

0.23

 

$

0.46

 

$

0.46

 

 
Weighted average shares outstanding
Basic

 

61,378,226

 

 

61,514,395

 

 

62,037,884

 

 

62,521,684

 

 

63,214,593

 

 

61,445,934

 

 

63,304,751

 

 
Diluted

 

61,546,285

 

 

61,709,797

 

 

62,264,983

 

 

62,730,157

 

 

63,409,683

 

 

61,624,569

 

 

63,465,515

 

 
Period end shares outstanding

 

61,201,123

 

 

61,463,392

 

 

61,648,679

 

 

62,461,832

 

 

62,773,226

 

 

61,201,123

 

 

62,773,226

 

 
 
See Notes to Consolidated Financials
 
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2022
($ in thousands)
(unaudited)
 
 
Quarter Ended
NONPERFORMING ASSETS (1) 6/30/2022 3/31/2022 12/31/2021 9/30/2021 6/30/2021
Nonaccrual LHFI
Alabama

$

2,698

 

$

7,506

 

$

8,182

 

$

9,223

 

$

8,952

 

Florida

 

233

 

 

310

 

 

313

 

 

381

 

 

467

 

Mississippi (2)

 

23,039

 

 

21,318

 

 

21,636

 

 

22,898

 

 

23,422

 

Tennessee (3)

 

9,500

 

 

9,266

 

 

10,501

 

 

10,356

 

 

10,751

 

Texas

 

26,582

 

 

25,999

 

 

22,066

 

 

23,382

 

 

7,856

 

Total nonaccrual LHFI

 

62,052

 

 

64,399

 

 

62,698

 

 

66,240

 

 

51,448

 

Other real estate
Alabama

 

84

 

 

 

 

 

 

613

 

 

2,830

 

Mississippi (2)

 

2,950

 

 

3,187

 

 

4,557

 

 

5,600

 

 

6,550

 

Tennessee (3)

 

 

 

 

 

 

 

 

 

59

 

Total other real estate

 

3,034

 

 

3,187

 

 

4,557

 

 

6,213

 

 

9,439

 

Total nonperforming assets

$

65,086

 

$

67,586

 

$

67,255

 

$

72,453

 

$

60,887

 

 
LOANS PAST DUE OVER 90 DAYS (1)
LHFI

$

1,347

 

$

1,503

 

$

2,114

 

$

625

 

$

423

 

 
LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase)

$

51,164

 

$

62,078

 

$

69,894

 

$

75,091

 

$

81,538

 

 
 
Quarter Ended Six Months Ended
ACL LHFI (1) 6/30/2022 3/31/2022 12/31/2021 9/30/2021 6/30/2021 6/30/2022 6/30/2021
Beginning Balance

$

98,734

 

$

99,457

 

$

104,073

 

$

104,032

 

$

109,191

 

$

99,457

 

$

117,306

 

Provision for credit losses, LHFI

 

2,716

 

 

(860

)

 

(4,515

)

 

(2,492

)

 

(3,991

)

 

1,856

 

 

(14,492

)

Charge-offs

 

(2,277

)

 

(2,242

)

 

(2,616

)

 

(1,586

)

 

(4,828

)

 

(4,519

)

 

(6,073

)

Recoveries

 

3,967

 

 

2,379

 

 

2,515

 

 

4,119

 

 

3,660

 

 

6,346

 

 

7,291

 

Net (charge-offs) recoveries

 

1,690

 

 

137

 

 

(101

)

 

2,533

 

 

(1,168

)

 

1,827

 

 

1,218

 

Ending Balance

$

103,140

 

$

98,734

 

$

99,457

 

$

104,073

 

$

104,032

 

$

103,140

 

$

104,032

 

 
NET (CHARGE-OFFS) RECOVERIES (1)
Alabama

$

1,129

 

$

699

 

$

747

 

$

247

 

$

203

 

$

1,828

 

$

305

 

Florida

 

761

 

 

(26

)

 

(32

)

 

356

 

 

167

 

 

735

 

 

197

 

Mississippi (2)

 

(266

)

 

(88

)

 

(683

)

 

1,436

 

 

(3,071

)

 

(354

)

 

(864

)

Tennessee (3)

 

31

 

 

(424

)

 

(130

)

 

(8

)

 

1,031

 

 

(393

)

 

1,078

 

Texas

 

35

 

 

(24

)

 

(3

)

 

502

 

 

502

 

 

11

 

 

502

 

Total net (charge-offs) recoveries

$

1,690

 

$

137

 

$

(101

)

$

2,533

 

$

(1,168

)

$

1,827

 

$

1,218

 

 

(1)

Excludes PPP loans.

(2)

Mississippi includes Central and Southern Mississippi Regions.

(3)

Tennessee includes Memphis, Tennessee and Northern Mississippi Regions.

 
See Notes to Consolidated Financials
 
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2022
(unaudited)
 
 
Quarter Ended Six Months Ended
FINANCIAL RATIOS AND OTHER DATA 6/30/2022 3/31/2022 12/31/2021 9/30/2021 6/30/2021 6/30/2022 6/30/2021
Return on average equity

 

8.55

%

 

6.91

%

 

5.92

%

 

4.72

%

 

10.81

%

7.71

%

11.39

%

Return on average tangible equity

 

11.36

%

 

9.05

%

 

7.72

%

 

6.16

%

 

13.96

%

10.16

%

14.75

%

Return on average assets

 

0.79

%

 

0.68

%

 

0.60

%

 

0.49

%

 

1.13

%

0.73

%

1.20

%

Interest margin - Yield - FTE

 

3.01

%

 

2.69

%

 

2.65

%

 

2.70

%

 

3.33

%

2.85

%

3.17

%

Interest margin - Cost

 

0.11

%

 

0.11

%

 

0.13

%

 

0.14

%

 

0.17

%

0.11

%

0.18

%

Net interest margin - FTE

 

2.90

%

 

2.58

%

 

2.53

%

 

2.57

%

 

3.16

%

2.74

%

2.99

%

Efficiency ratio (1)

 

71.89

%

 

76.44

%

 

76.52

%

 

74.10

%

 

64.31

%

74.08

%

67.93

%

Full-time equivalent employees

 

2,727

 

 

2,725

 

 

2,692

 

 

2,680

 

 

2,772

 

 
CREDIT QUALITY RATIOS (2)
Net (recoveries) charge-offs / average loans

 

-0.06

%

 

-0.01

%

 

0.00

%

 

-0.10

%

 

0.05

%

-0.03

%

-0.02

%

Provision for credit losses, LHFI / average loans

 

0.10

%

 

-0.03

%

 

-0.17

%

 

-0.10

%

 

-0.16

%

0.03

%

-0.28

%

Nonaccrual LHFI / (LHFI + LHFS)

 

0.56

%

 

0.61

%

 

0.60

%

 

0.63

%

 

0.49

%

Nonperforming assets / (LHFI + LHFS)

 

0.58

%

 

0.64

%

 

0.64

%

 

0.69

%

 

0.58

%

Nonperforming assets / (LHFI + LHFS + other real estate)

 

0.58

%

 

0.64

%

 

0.64

%

 

0.69

%

 

0.58

%

ACL LHFI / LHFI

 

0.94

%

 

0.95

%

 

0.97

%

 

1.02

%

 

1.02

%

ACL LHFI-commercial / commercial LHFI

 

0.88

%

 

0.95

%

 

1.00

%

 

1.05

%

 

1.04

%

ACL LHFI-consumer / consumer and home mortgage LHFI

 

1.14

%

 

0.96

%

 

0.87

%

 

0.91

%

 

0.98

%

ACL LHFI / nonaccrual LHFI

 

166.22

%

 

153.32

%

 

158.63

%

 

157.11

%

 

202.21

%

ACL LHFI / nonaccrual LHFI (excl individually evaluated loans)

 

475.27

%

 

484.01

%

 

500.85

%

 

520.77

%

 

537.35

%

 
CAPITAL RATIOS
Total equity / total assets

 

9.36

%

 

9.35

%

 

9.90

%

 

10.19

%

 

10.41

%

Tangible equity / tangible assets

 

7.23

%

 

7.29

%

 

7.86

%

 

8.12

%

 

8.31

%

Tangible equity / risk-weighted assets

 

9.16

%

 

9.79

%

 

10.71

%

 

11.19

%

 

11.33

%

Tier 1 leverage ratio

 

8.80

%

 

8.66

%

 

8.73

%

 

8.92

%

 

9.00

%

Common equity tier 1 capital ratio

 

11.01

%

 

11.23

%

 

11.29

%

 

11.68

%

 

11.76

%

Tier 1 risk-based capital ratio

 

11.47

%

 

11.70

%

 

11.77

%

 

12.17

%

 

12.25

%

Total risk-based capital ratio

 

13.26

%

 

13.53

%

 

13.55

%

 

14.01

%

 

14.10

%

 
STOCK PERFORMANCE
Market value-Close

$

29.19

 

$

30.39

 

$

32.46

 

$

32.22

 

$

30.80

 

Book value

$

25.93

 

$

26.54

 

$

28.25

 

$

28.32

 

$

28.35

 

Tangible book value

$

19.58

 

$

20.22

 

$

21.93

 

$

22.08

 

$

22.13

 

 

(1)

See Note 6 – Non-GAAP Financial Measures in the Notes to Consolidated Financials for Trustmark’s efficiency ratio calculation.

(2)

Excludes PPP loans.

 
See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

June 30, 2022

($ in thousands)

(unaudited)

Note 1 - Securities Available for Sale and Held to Maturity

The following table is a summary of the estimated fair value of securities available for sale and the amortized cost of securities held to maturity:

 

 

6/30/2022

 

 

3/31/2022

 

 

12/31/2021

 

 

9/30/2021

 

 

6/30/2021

 

SECURITIES AVAILABLE FOR SALE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

$

419,696

 

 

$

361,822

 

 

$

344,640

 

 

$

278,615

 

 

$

30,025

 

U.S. Government agency obligations

 

 

11,947

 

 

 

12,623

 

 

 

13,727

 

 

 

14,979

 

 

 

16,023

 

Obligations of states and political subdivisions

 

 

5,179

 

 

 

5,359

 

 

 

5,714

 

 

 

5,734

 

 

 

5,807

 

Mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage pass-through securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Guaranteed by GNMA

 

 

32,240

 

 

 

35,117

 

 

 

39,573

 

 

 

43,860

 

 

 

48,445

 

Issued by FNMA and FHLMC

 

 

1,888,546

 

 

 

2,038,331

 

 

 

2,218,429

 

 

 

2,187,412

 

 

 

1,983,783

 

Other residential mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issued or guaranteed by FNMA, FHLMC, or GNMA

 

 

144,158

 

 

 

164,506

 

 

 

196,690

 

 

 

236,885

 

 

 

283,988

 

Commercial mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issued or guaranteed by FNMA, FHLMC, or GNMA

 

 

142,598

 

 

 

400,488

 

 

 

420,104

 

 

 

290,120

 

 

 

180,668

 

Total securities available for sale

 

$

2,644,364

 

 

$

3,018,246

 

 

$

3,238,877

 

 

$

3,057,605

 

 

$

2,548,739

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SECURITIES HELD TO MATURITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Obligations of states and political subdivisions

 

$

5,320

 

 

$

7,324

 

 

$

7,328

 

 

$

10,683

 

 

$

12,994

 

Mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage pass-through securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Guaranteed by GNMA

 

 

4,624

 

 

 

4,831

 

 

 

5,005

 

 

 

5,912

 

 

 

6,249

 

Issued by FNMA and FHLMC

 

 

185,554

 

 

 

192,373

 

 

 

43,444

 

 

 

48,554

 

 

 

53,406

 

Other residential mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issued or guaranteed by FNMA, FHLMC, or GNMA

 

 

210,479

 

 

 

224,012

 

 

 

241,934

 

 

 

264,638

 

 

 

291,477

 

Commercial mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issued or guaranteed by FNMA, FHLMC, or GNMA

 

 

731,777

 

 

 

179,058

 

 

 

44,826

 

 

 

65,118

 

 

 

68,886

 

Total securities held to maturity

 

$

1,137,754

 

 

$

607,598

 

 

$

342,537

 

 

$

394,905

 

 

$

433,012

 

During the second quarter of 2022, Trustmark reclassified $343.1 million of securities available for sale to securities held to maturity. The securities were transferred at fair value, which became the cost basis for the securities held to maturity. At the date of transfer, the net unrealized holding loss on the available for sale securities totaled approximately $34.8 million ($26.1 million, net of tax). The net unrealized holding loss will be amortized over the remaining life of the securities as a yield adjustment in a manner consistent with the amortization or accretion of the original purchase premium or discount on the associated security. There were no gains or losses recognized as a result of the transfer.

At June 30, 2022, the net unamortized, unrealized loss included in accumulated other comprehensive income (loss) in the accompanying balance sheet for securities held to maturity transferred from securities available for sale totaled approximately $39.5 million ($29.7 million, net of tax).

Management continues to focus on asset quality as one of the strategic goals of the securities portfolio, which is evidenced by the investment of 99.7% of the portfolio in GSE-backed obligations and other Aaa rated securities as determined by Moody’s. None of the securities owned by Trustmark are collateralized by assets which are considered sub-prime. Furthermore, outside of stock ownership in the Federal Home Loan Bank of Dallas, Federal Home Loan Bank of Atlanta and Federal Reserve Bank, Trustmark does not hold any other equity investment in a GSE.

Note 2 – Loan Composition

LHFI consisted of the following during the periods presented:

LHFI BY TYPE

 

6/30/2022

 

3/31/2022

 

12/31/2021

 

9/30/2021

 

6/30/2021

Loans secured by real estate:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction, land development and other land loans

 

$

1,440,058

 

 

$

1,273,959

 

 

$

1,308,781

 

 

$

1,286,613

 

 

$

1,360,302

 

Secured by 1-4 family residential properties

 

 

2,424,962

 

 

 

2,106,998

 

 

 

1,977,993

 

 

 

1,891,292

 

 

 

1,810,396

 

Secured by nonfarm, nonresidential properties

 

 

3,178,079

 

 

 

2,975,039

 

 

 

2,977,084

 

 

 

2,924,953

 

 

 

2,819,662

 

Other real estate secured

 

 

555,311

 

 

 

715,939

 

 

 

726,043

 

 

 

986,163

 

 

 

1,078,622

 

Commercial and industrial loans

 

 

1,551,001

 

 

 

1,495,060

 

 

 

1,414,279

 

 

 

1,327,211

 

 

 

1,326,605

 

Consumer loans

 

 

160,716

 

 

 

154,215

 

 

 

159,472

 

 

 

157,963

 

 

 

153,519

 

State and other political subdivision loans

 

 

1,110,795

 

 

 

1,215,023

 

 

 

1,146,251

 

 

 

1,125,186

 

 

 

1,136,764

 

Other loans

 

 

523,918

 

 

 

460,896

 

 

 

537,926

 

 

 

475,518

 

 

 

466,999

 

LHFI

 

 

10,944,840

 

 

 

10,397,129

 

 

 

10,247,829

 

 

 

10,174,899

 

 

 

10,152,869

 

ACL LHFI

 

 

(103,140

)

 

 

(98,734

)

 

 

(99,457

)

 

 

(104,073

)

 

 

(104,032

)

Net LHFI

 

$

10,841,700

 

 

$

10,298,395

 

 

$

10,148,372

 

 

$

10,070,826

 

 

$

10,048,837

 

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

June 30, 2022

($ in thousands)

(unaudited)

Note 2 – Loan Composition (continued)

The following table presents the LHFI composition by region and reflects each region’s diversified mix of loans:

 

 

June 30, 2022

 

LHFI - COMPOSITION BY REGION

 

Total

 

 

Alabama

 

 

Florida

 

 

Mississippi

(Central and

Southern

Regions)

 

 

Tennessee

(Memphis,

TN and

Northern
MS

Regions)

 

 

Texas

 

Loans secured by real estate:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction, land development and other land loans

 

$

1,440,058

 

 

$

610,402

 

 

$

52,587

 

 

$

391,970

 

 

$

43,608

 

 

$

341,491

 

Secured by 1-4 family residential properties

 

 

2,424,962

 

 

 

119,599

 

 

 

44,161

 

 

 

2,166,787

 

 

 

67,906

 

 

 

26,509

 

Secured by nonfarm, nonresidential properties

 

 

3,178,079

 

 

 

927,830

 

 

 

252,323

 

 

 

1,245,604

 

 

 

178,658

 

 

 

573,664

 

Other real estate secured

 

 

555,311

 

 

 

120,384

 

 

 

1,784

 

 

 

265,884

 

 

 

6,906

 

 

 

160,353

 

Commercial and industrial loans

 

 

1,551,001

 

 

 

393,458

 

 

 

23,451

 

 

 

644,894

 

 

 

243,252

 

 

 

245,946

 

Consumer loans

 

 

160,716

 

 

 

22,021

 

 

 

7,571

 

 

 

99,852

 

 

 

18,685

 

 

 

12,587

 

State and other political subdivision loans

 

 

1,110,795

 

 

 

85,538

 

 

 

69,860

 

 

 

721,339

 

 

 

28,922

 

 

 

205,136

 

Other loans

 

 

523,918

 

 

 

69,924

 

 

 

11,160

 

 

 

319,743

 

 

 

69,941

 

 

 

53,150

 

Loans

 

$

10,944,840

 

 

$

2,349,156

 

 

$

462,897

 

 

$

5,856,073

 

 

$

657,878

 

 

$

1,618,836

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CONSTRUCTION, LAND DEVELOPMENT AND OTHER LAND LOANS BY REGION

 

 

 

 

 

 

 

Lots

 

$

69,566

 

 

$

35,149

 

 

$

10,758

 

 

$

16,700

 

 

$

2,255

 

 

$

4,704

 

Development

 

 

149,183

 

 

 

55,380

 

 

 

1,726

 

 

 

52,982

 

 

 

6,556

 

 

 

32,539

 

Unimproved land

 

 

100,319

 

 

 

17,366

 

 

 

11,781

 

 

 

32,771

 

 

 

10,889

 

 

 

27,512

 

1-4 family construction

 

 

345,749

 

 

 

166,916

 

 

 

24,590

 

 

 

90,778

 

 

 

23,899

 

 

 

39,566

 

Other construction

 

 

775,241

 

 

 

335,591

 

 

 

3,732

 

 

 

198,739

 

 

 

9

 

 

 

237,170

 

Construction, land development and other land loans

 

$

1,440,058

 

 

$

610,402

 

 

$

52,587

 

 

$

391,970

 

 

$

43,608

 

 

$

341,491

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOANS SECURED BY NONFARM, NONRESIDENTIAL PROPERTIES BY REGION

 

 

 

 

 

 

 

Non-owner occupied:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail

 

$

331,004

 

 

$

129,167

 

 

$

35,109

 

 

$

81,857

 

 

$

22,142

 

 

62,729

 

Office

 

 

282,768

 

 

 

110,140

 

 

 

19,116

 

 

 

89,459

 

 

 

10,790

 

 

 

53,263

 

Hotel/motel

 

 

339,184

 

 

 

186,628

 

 

 

76,318

 

 

 

33,002

 

 

 

28,693

 

 

 

14,543

 

Mini-storage

 

 

160,857

 

 

 

23,452

 

 

 

2,196

 

 

 

110,162

 

 

 

423

 

 

 

24,624

 

Industrial

 

 

296,943

 

 

 

106,567

 

 

 

19,243

 

 

 

99,690

 

 

 

252

 

 

 

71,191

 

Health care

 

 

53,221

 

 

 

20,763

 

 

 

1,045

 

 

 

27,704

 

 

 

351

 

 

 

3,358

 

Convenience stores

 

 

28,737

 

 

 

8,538

 

 

 

661

 

 

 

14,191

 

 

 

1,123

 

 

 

4,224

 

Nursing homes/senior living

 

 

343,468

 

 

 

138,209

 

 

 

 

 

 

138,436

 

 

 

5,934

 

 

 

60,889

 

Other

 

 

106,771

 

 

 

15,903

 

 

 

10,094

 

 

 

48,052

 

 

 

16,801

 

 

 

15,921

 

Total non-owner occupied loans

 

 

1,942,953

 

 

 

739,367

 

 

 

163,782

 

 

 

642,553

 

 

 

86,509

 

 

 

310,742

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Owner-occupied:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

 

154,226

 

 

 

42,428

 

 

 

36,256

 

 

 

45,836

 

 

 

12,664

 

 

 

17,042

 

Churches

 

 

77,154

 

 

 

17,024

 

 

 

5,439

 

 

 

43,393

 

 

 

7,979

 

 

 

3,319

 

Industrial warehouses

 

 

176,614

 

 

 

16,967

 

 

 

2,396

 

 

 

48,135

 

 

 

17,099

 

 

 

92,017

 

Health care

 

 

126,529

 

 

 

11,632

 

 

 

6,601

 

 

 

91,264

 

 

 

2,379

 

 

 

14,653

 

Convenience stores

 

 

152,200

 

 

 

13,886

 

 

 

20,857

 

 

 

71,648

 

 

 

421

 

 

 

45,388

 

Retail

 

 

97,749

 

 

 

12,615

 

 

 

9,052

 

 

 

44,873

 

 

 

19,151

 

 

 

12,058

 

Restaurants

 

 

54,167

 

 

 

3,143

 

 

 

4,801

 

 

 

29,965

 

 

 

12,377

 

 

 

3,881

 

Auto dealerships

 

 

51,017

 

 

 

6,453

 

 

 

242

 

 

 

25,496

 

 

 

18,826

 

 

 

 

Nursing homes/senior living

 

 

211,462

 

 

 

50,570

 

 

 

 

 

 

134,692

 

 

 

 

 

 

26,200

 

Other

 

 

134,008

 

 

 

13,745

 

 

 

2,897

 

 

 

67,749

 

 

 

1,253

 

 

 

48,364

 

Total owner-occupied loans

 

 

1,235,126

 

 

 

188,463

 

 

 

88,541

 

 

 

603,051

 

 

 

92,149

 

 

 

262,922

 

Loans secured by nonfarm, nonresidential properties

 

3,178,079

 

 

927,830

 

 

252,323

 

 

1,245,604

 

 

178,658

 

 

573,664

 

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

June 30, 2022

($ in thousands)

(unaudited)

Note 3 – Yields on Earning Assets and Interest-Bearing Liabilities

The following table illustrates the yields on earning assets by category as well as the rates paid on interest-bearing liabilities on a tax equivalent basis:

 

 

Quarter Ended

 

Six Months Ended

 

 

6/30/2022

 

3/31/2022

 

12/31/2021

 

9/30/2021

 

6/30/2021

 

6/30/2022

 

6/30/2021

Securities – taxable

 

 

1.50

%

 

 

1.37

%

 

 

1.22

%

 

 

1.28

%

 

 

1.30

%

 

 

1.44

%

 

 

1.35

%

Securities – nontaxable

 

 

4.00

%

 

 

3.97

%

 

 

3.82

%

 

 

3.79

%

 

 

3.70

%

 

 

3.98

%

 

 

3.91

%

Securities – total

 

 

1.50

%

 

 

1.38

%

 

 

1.23

%

 

 

1.29

%

 

 

1.31

%

 

 

1.44

%

 

 

1.37

%

PPP loans

 

 

4.16

%

 

 

2.35

%

 

 

3.68

%

 

 

4.98

%

 

 

15.81

%

 

 

3.04

%

 

 

11.26

%

Loans - LHFI & LHFS

 

 

3.79

%

 

 

3.58

%

 

 

3.56

%

 

 

3.59

%

 

 

3.64

%

 

 

3.69

%

 

 

3.66

%

Loans - total

 

 

3.79

%

 

 

3.58

%

 

 

3.56

%

 

 

3.61

%

 

 

4.36

%

 

 

3.69

%

 

 

4.09

%

Fed funds sold & reverse repurchases

 

 

3.65

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.43

%

 

 

 

Other earning assets

 

 

0.78

%

 

 

0.18

%

 

 

0.18

%

 

 

0.18

%

 

 

0.11

%

 

 

0.41

%

 

 

0.12

%

Total earning assets

 

 

3.01

%

 

 

2.69

%

 

 

2.65

%

 

 

2.70

%

 

 

3.33

%

 

 

2.85

%

 

 

3.17

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

 

0.11

%

 

 

0.11

%

 

 

0.13

%

 

 

0.14

%

 

 

0.19

%

 

 

0.11

%

 

 

0.20

%

Fed funds purchased & repurchases

 

 

0.24

%

 

 

0.13

%

 

 

0.13

%

 

 

0.14

%

 

 

0.14

%

 

 

0.17

%

 

 

0.14

%

Other borrowings

 

 

2.52

%

 

 

2.26

%

 

 

2.25

%

 

 

2.33

%

 

 

2.29

%

 

 

2.39

%

 

 

2.21

%

Total interest-bearing liabilities

 

 

0.17

%

 

 

0.16

%

 

 

0.19

%

 

 

0.21

%

 

 

0.25

%

 

 

0.17

%

 

 

0.26

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin

 

 

2.90

%

 

 

2.58

%

 

 

2.53

%

 

 

2.57

%

 

 

3.16

%

 

 

2.74

%

 

 

2.99

%

Net interest margin excluding PPP loans and the FRB balance

 

 

3.06

%

 

 

2.88

%

 

 

2.82

%

 

 

2.90

%

 

 

2.94

%

 

 

2.97

%

 

 

2.96

%

Reflected in the table above are yields on earning assets and liabilities, along with the net interest margin which equals reported net interest income-FTE, annualized, as a percent of average earning assets. In addition, the table includes net interest margin excluding PPP loans and the balance held at the Federal Reserve Bank of Atlanta (FRB), which equals reported net interest income-FTE excluding interest income on PPP loans and the FRB balance, annualized, as a percent of average earning assets excluding average PPP loans and the FRB balance.

At June 30, 2022 and March 31, 2022, the average FRB balance totaled $1.077 billion and $1.758 billion, respectively, and is included in other earning assets in the accompanying average consolidated balance sheets.

The net interest margin excluding PPP loans and the FRB balance totaled 3.06% for the second quarter of 2022, an increase of 18 basis points when compared to the first quarter of 2022. The expansion of the net interest margin excluding PPP loans and the FRB balance was due to increases in the yields on the loans held for investment and held for sale portfolio and the securities portfolio which resulted from the higher interest-rate environment.

Note 4 – Mortgage Banking

Trustmark utilizes a portfolio of exchange-traded derivative instruments, such as Treasury note futures contracts and option contracts, to achieve a fair value return that offsets the changes in fair value of mortgage servicing rights (MSR) attributable to interest rates. These transactions are considered freestanding derivatives that do not otherwise qualify for hedge accounting under generally accepted accounting principles (GAAP). Changes in the fair value of these exchange-traded derivative instruments, including administrative costs, are recorded in noninterest income in mortgage banking, net and are offset by the changes in the fair value of the MSR. The MSR fair value represents the present value of future cash flows, which among other things includes decay and the effect of changes in interest rates. Ineffectiveness of hedging the MSR fair value is measured by comparing the change in value of hedge instruments to the change in the fair value of the MSR asset attributable to changes in interest rates and other market driven changes in valuation inputs and assumptions. The impact of this strategy resulted in a net negative ineffectiveness of $632 thousand during the second quarter of 2022.

The following table illustrates the components of mortgage banking revenues included in noninterest income in the accompanying income statements:

 

 

Quarter Ended

 

Six Months Ended

 

 

6/30/2022

 

3/31/2022

 

12/31/2021

 

9/30/2021

 

6/30/2021

 

6/30/2022

 

6/30/2021

Mortgage servicing income, net

 

$

6,557

 

 

$

6,429

 

 

$

6,571

 

 

$

6,406

 

 

$

6,318

 

 

$

12,986

 

 

$

12,499

 

Change in fair value-MSR from runoff

 

 

(3,806

)

 

 

(3,785

)

 

 

(4,745

)

 

 

(5,283

)

 

 

(5,029

)

 

 

(7,591

)

 

 

(10,132

)

Gain on sales of loans, net

 

 

6,030

 

 

 

6,223

 

 

 

9,005

 

 

 

12,737

 

 

 

14,778

 

 

 

12,253

 

 

 

34,234

 

Mortgage banking income before hedge ineffectiveness

 

 

8,781

 

 

 

8,867

 

 

 

10,831

 

 

 

13,860

 

 

 

16,067

 

 

 

17,648

 

 

 

36,601

 

Change in fair value-MSR from market changes

 

 

8,739

 

 

 

22,020

 

 

 

2,221

 

 

 

1,806

 

 

 

(4,465

)

 

 

30,759

 

 

 

9,231

 

Change in fair value of derivatives

 

 

(9,371

)

 

 

(21,014

)

 

 

(1,443

)

 

 

(1,662

)

 

 

5,731

 

 

 

(30,385

)

 

 

(7,695

)

Net positive (negative) hedge ineffectiveness

 

 

(632

)

 

 

1,006

 

 

 

778

 

 

 

144

 

 

 

1,266

 

 

 

374

 

 

 

1,536

 

Mortgage banking, net

 

$

8,149

 

 

$

9,873

 

 

$

11,609

 

 

$

14,004

 

 

$

17,333

 

 

$

18,022

 

 

$

38,137

 

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

June 30, 2022

($ in thousands)

(unaudited)

Note 5 – Other Noninterest Income and Expense

Other noninterest income consisted of the following for the periods presented:

 

 

Quarter Ended

 

Six Months Ended

 

 

6/30/2022

 

3/31/2022

 

12/31/2021

 

9/30/2021

 

6/30/2021

 

6/30/2022

 

6/30/2021

Partnership amortization for tax credit purposes

 

$

(1,475

)

 

$

(1,336

)

 

$

(2,455

)

 

$

(2,045

)

 

$

(1,989

)

 

$

(2,811

)

 

$

(3,511

)

Increase in life insurance cash surrender value

 

 

1,683

 

 

 

1,627

 

 

 

1,675

 

 

 

1,663

 

 

 

1,653

 

 

 

3,310

 

 

 

3,292

 

Other miscellaneous income

 

 

1,699

 

 

 

2,915

 

 

 

1,759

 

 

 

1,863

 

 

 

2,337

 

 

 

4,614

 

 

 

4,310

 

Total other, net

 

$

1,907

 

 

$

3,206

 

 

$

979

 

 

$

1,481

 

 

$

2,001

 

 

$

5,113

 

 

$

4,091

 

Trustmark invests in partnerships that provide income tax credits on a Federal and/or State basis (i.e., new market tax credits, low-income housing tax credits and historical tax credits). The income tax credits related to these partnerships are utilized as specifically allowed by income tax law and are recorded as a reduction in income tax expense.

Other noninterest expense consisted of the following for the periods presented:

 

 

Quarter Ended

 

Six Months Ended

 

 

6/30/2022

 

3/31/2022

 

12/31/2021

 

9/30/2021

 

6/30/2021

 

6/30/2022

 

6/30/2021

Loan expense

 

$

4,068

 

 

$

4,389

 

 

$

3,221

 

 

$

4,022

 

 

$

3,738

 

 

$

8,457

 

 

$

7,905

 

Amortization of intangibles

 

 

328

 

 

 

482

 

 

 

548

 

 

 

549

 

 

 

553

 

 

 

810

 

 

 

1,219

 

FDIC assessment expense

 

 

1,810

 

 

 

1,500

 

 

 

1,475

 

 

 

1,275

 

 

 

1,225

 

 

 

3,310

 

 

 

2,765

 

Regulatory settlement charge

 

 

 

 

 

 

 

 

 

 

 

5,000

 

 

 

 

 

 

 

 

 

 

Other real estate expense, net

 

 

623

 

 

 

35

 

 

 

336

 

 

 

1,357

 

 

 

1,511

 

 

 

658

 

 

 

1,835

 

Other miscellaneous expense

 

 

7,782

 

 

 

7,935

 

 

 

9,326

 

 

 

7,673

 

 

 

7,623

 

 

 

15,717

 

 

 

15,789

 

Total other expense

 

$

14,611

 

 

$

14,341

 

 

$

14,906

 

 

$

19,876

 

 

$

14,650

 

 

$

28,952

 

 

$

29,513

 

Note 6 – Non-GAAP Financial Measures

In addition to capital ratios defined by GAAP and banking regulators, Trustmark utilizes various tangible common equity measures when evaluating capital utilization and adequacy. Tangible common equity, as defined by Trustmark, represents common equity less goodwill and identifiable intangible assets. Trustmark’s Common Equity Tier 1 capital includes common stock, capital surplus and retained earnings, and is reduced by goodwill and other intangible assets, net of associated net deferred tax liabilities as well as disallowed deferred tax assets and threshold deductions as applicable.

Trustmark believes these measures are important because they reflect the level of capital available to withstand unexpected market conditions. Additionally, presentation of these measures allows readers to compare certain aspects of Trustmark’s capitalization to other organizations. These ratios differ from capital measures defined by banking regulators principally in that the numerator excludes shareholders’ equity associated with preferred securities, the nature and extent of which varies across organizations. In Management’s experience, many stock analysts use tangible common equity measures in conjunction with more traditional bank capital ratios to compare capital adequacy of banking organizations with significant amounts of goodwill or other intangible assets, typically stemming from the use of the purchase accounting method in accounting for mergers and acquisitions.

These calculations are intended to complement the capital ratios defined by GAAP and banking regulators. Because GAAP does not include these capital ratio measures, Trustmark believes there are no comparable GAAP financial measures to these tangible common equity ratios. Despite the importance of these measures to Trustmark, there are no standardized definitions for them and, as a result, Trustmark’s calculations may not be comparable with other organizations. Also, there may be limits in the usefulness of these measures to investors. As a result, Trustmark encourages readers to consider its audited consolidated financial statements and the notes related thereto in their entirety and not to rely on any single financial measure.

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

June 30, 2022

($ in thousands except per share data)

(unaudited)

Note 6 – Non-GAAP Financial Measures (continued)

 

 

 

 

Quarter Ended

 

Six Months Ended

 

 

 

 

6/30/2022

 

3/31/2022

 

12/31/2021

 

9/30/2021

 

6/30/2021

 

6/30/2022

 

6/30/2021

TANGIBLE EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AVERAGE BALANCES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total shareholders' equity

 

 

 

$

1,608,309

 

 

$

1,713,752

 

 

$

1,758,123

 

 

$

1,782,304

 

 

$

1,780,705

 

 

$

1,660,739

 

 

$

1,770,087

 

Less: Goodwill

 

 

 

 

(384,237

)

 

 

(384,237

)

 

 

(384,237

)

 

 

(384,237

)

 

 

(384,237

)

 

 

(384,237

)

 

 

(384,694

)

Identifiable intangible assets

 

 

 

 

(4,436

)

 

 

(4,879

)

 

 

(5,382

)

 

 

(5,899

)

 

 

(6,442

)

 

 

(4,656

)

 

 

(6,778

)

Total average tangible equity

 

 

 

$

1,219,636

 

 

$

1,324,636

 

 

$

1,368,504

 

 

$

1,392,168

 

 

$

1,390,026

 

 

$

1,271,846

 

 

$

1,378,615

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PERIOD END BALANCES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total shareholders' equity

 

 

 

$

1,586,696

 

 

$

1,631,382

 

 

$

1,741,311

 

 

$

1,768,947

 

 

$

1,779,309

 

 

 

 

 

 

 

Less: Goodwill

 

 

 

 

(384,237

)

 

 

(384,237

)

 

 

(384,237

)

 

 

(384,237

)

 

 

(384,237

)

 

 

 

 

 

 

Identifiable intangible assets

 

 

 

 

(4,264

)

 

 

(4,591

)

 

 

(5,074

)

 

 

(5,621

)

 

 

(6,170

)

 

 

 

 

 

 

Total tangible equity

 

(a)

 

$

1,198,195

 

 

$

1,242,554

 

 

$

1,352,000

 

 

$

1,379,089

 

 

$

1,388,902

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TANGIBLE ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

 

 

$

16,951,510

 

 

$

17,441,551

 

 

$

17,595,636

 

 

$

17,364,644

 

 

$

17,098,132

 

 

 

 

 

 

 

Less: Goodwill

 

 

 

 

(384,237

)

 

 

(384,237

)

 

 

(384,237

)

 

 

(384,237

)

 

 

(384,237

)

 

 

 

 

 

 

Identifiable intangible assets

 

 

 

 

(4,264

)

 

 

(4,591

)

 

 

(5,074

)

 

 

(5,621

)

 

 

(6,170

)

 

 

 

 

 

 

Total tangible assets

 

(b)

 

$

16,563,009

 

 

$

17,052,723

 

 

$

17,206,325

 

 

$

16,974,786

 

 

$

16,707,725

 

 

 

 

 

 

 

Risk-weighted assets

 

(c)

 

$

13,076,981

 

 

$

12,691,545

 

 

$

12,623,630

 

 

$

12,324,254

 

 

$

12,256,492

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME ADJUSTED FOR INTANGIBLE AMORTIZATION

 

 

 

 

 

 

 

Net income

 

 

 

$

34,284

 

 

$

29,211

 

 

$

26,222

 

 

$

21,200

 

 

$

47,981

 

 

$

63,495

 

 

$

99,943

 

Plus: Intangible amortization net of tax

 

 

 

 

246

 

 

 

362

 

 

 

411

 

 

 

412

 

 

 

415

 

 

 

608

 

 

 

915

 

Net income adjusted for intangible amortization

 

$

34,530

 

 

$

29,573

 

 

$

26,633

 

 

$

21,612

 

 

$

48,396

 

 

$

64,103

 

 

$

100,858

 

Period end common shares outstanding

 

(d)

 

 

61,201,123

 

 

 

61,463,392

 

 

 

61,648,679

 

 

 

62,461,832

 

 

 

62,773,226

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TANGIBLE COMMON EQUITY MEASUREMENTS

 

 

 

 

 

 

 

Return on average tangible equity (1)

 

 

 

 

11.36

%

 

 

9.05

%

 

 

7.72

%

 

 

6.16

%

 

 

13.96

%

 

 

10.16

%

 

 

14.75

%

Tangible equity/tangible assets

 

(a)/(b)

 

 

7.23

%

 

 

7.29

%

 

 

7.86

%

 

 

8.12

%

 

 

8.31

%

 

 

 

 

 

 

Tangible equity/risk-weighted assets

 

(a)/(c)

 

 

9.16

%

 

 

9.79

%

 

 

10.71

%

 

 

11.19

%

 

 

11.33

%

 

 

 

 

 

 

Tangible book value

 

(a)/(d)*1,000

 

$

19.58

 

 

$

20.22

 

 

$

21.93

 

 

$

22.08

 

 

$

22.13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COMMON EQUITY TIER 1 CAPITAL (CET1)

 

 

 

 

 

 

 

Total shareholders' equity

 

 

 

$

1,586,696

 

 

$

1,631,382

 

 

$

1,741,311

 

 

$

1,768,947

 

 

$

1,779,309

 

 

 

 

 

 

 

CECL transition adjustment

 

 

 

 

19,500

 

 

 

19,500

 

 

 

26,000

 

 

 

26,419

 

 

 

26,671

 

 

 

 

 

 

 

AOCI-related adjustments

 

 

 

 

207,142

 

 

 

148,656

 

 

 

32,560

 

 

 

19,080

 

 

 

10,641

 

 

 

 

 

 

 

CET1 adjustments and deductions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Goodwill net of associated deferred tax liabilities (DTLs)

 

 

(370,229

)

 

 

(370,240

)

 

 

(370,252

)

 

 

(370,264

)

 

 

(370,276

)

 

 

 

 

 

 

Other adjustments and deductions for CET1 (2)

 

 

(3,757

)

 

 

(4,015

)

 

 

(4,392

)

 

 

(4,817

)

 

 

(5,243

)

 

 

 

 

 

 

CET1 capital

 

(e)

 

 

1,439,352

 

 

 

1,425,283

 

 

 

1,425,227

 

 

 

1,439,365

 

 

 

1,441,102

 

 

 

 

 

 

 

Additional tier 1 capital instruments plus related surplus

 

 

60,000

 

 

 

60,000

 

 

 

60,000

 

 

 

60,000

 

 

 

60,000

 

 

 

 

 

 

 

Tier 1 capital

 

 

 

$

1,499,352

 

 

$

1,485,283

 

 

$

1,485,227

 

 

$

1,499,365

 

 

$

1,501,102

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common equity tier 1 capital ratio

 

(e)/(c)

 

 

11.01

%

 

 

11.23

%

 

 

11.29

%

 

 

11.68

%

 

 

11.76

%

 

 

 

 

 

 

(1)

Calculation = ((net income adjusted for intangible amortization/number of days in period)*number of days in year)/total average tangible equity.

(2)

Includes other intangible assets, net of DTLs, disallowed deferred tax assets (DTAs), threshold deductions and transition adjustments, as applicable.

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

June 30, 2022

($ in thousands)

(unaudited)

Note 6 – Non-GAAP Financial Measures (continued)

Trustmark discloses certain non-GAAP financial measures because Management uses these measures for business planning purposes, including to manage Trustmark’s business against internal projected results of operations and to measure Trustmark’s performance. Trustmark views these as measures of our core operating business, which exclude the impact of the items detailed below, as these items are generally not operational in nature. These non-GAAP financial measures also provide another basis for comparing period-to-period results as presented in the accompanying selected financial data table and the audited consolidated financial statements by excluding potential differences caused by non-operational and unusual or non-recurring items. Readers are cautioned that these adjustments are not permitted under GAAP. Trustmark encourages readers to consider its consolidated financial statements and the notes related thereto in their entirety, and not to rely on any single financial measure.

The following table presents pre-provision net revenue (PPNR) during the periods presented:

 

 

Quarter Ended

 

Six Months Ended

 

 

6/30/2022

 

3/31/2022

 

12/31/2021

 

9/30/2021

 

6/30/2021

 

6/30/2022

 

6/30/2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income (GAAP)

 

$

112,676

 

 

$

99,344

 

 

$

98,326

 

 

$

98,266

 

 

$

119,423

 

 

$

212,020

 

 

$

221,759

 

Noninterest income (GAAP)

 

 

53,253

 

 

 

54,115

 

 

 

50,767

 

 

 

54,149

 

 

 

56,411

 

 

 

107,368

 

 

 

116,994

 

Pre-provision revenue

(a)

$

165,929

 

 

$

153,459

 

 

$

149,093

 

 

$

152,415

 

 

$

175,834

 

 

$

319,388

 

 

$

338,753

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense (GAAP)

 

$

123,767

 

 

$

121,519

 

 

$

119,469

 

 

$

129,600

 

 

$

118,679

 

 

$

245,286

 

 

$

240,227

 

Less: Voluntary early retirement program

 

 

 

 

 

 

 

 

 

 

 

(5,700

)

 

 

 

 

 

 

 

 

 

Regulatory settlement charge

 

 

 

 

 

 

 

 

 

 

 

(5,000

)

 

 

 

 

 

 

 

 

 

Adjusted noninterest expense - PPNR (Non-GAAP)

(b)

$

123,767

 

 

$

121,519

 

 

$

119,469

 

 

$

118,900

 

 

$

118,679

 

 

$

245,286

 

 

$

240,227

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PPNR (Non-GAAP)

(a)-(b)

$

42,162

 

 

$

31,940

 

 

$

29,624

 

 

$

33,515

 

 

$

57,155

 

 

$

74,102

 

 

$

98,526

 

The following table presents Trustmark’s calculation of its efficiency ratio for the periods presented:

 

 

Quarter Ended

 

Six Months Ended

 

 

6/30/2022

 

3/31/2022

 

12/31/2021

 

9/30/2021

 

6/30/2021

 

6/30/2022

 

6/30/2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest expense (GAAP)

 

$

123,767

 

 

$

121,519

 

 

$

119,469

 

 

$

129,600

 

 

$

118,679

 

 

$

245,286

 

 

$

240,227

 

Less: Other real estate expense, net

 

(623

)

 

 

(35

)

 

 

(336

)

 

 

(1,357

)

 

 

(1,511

)

 

 

(658

)

 

 

(1,835

)

Amortization of intangibles

 

(328

)

 

 

(482

)

 

 

(548

)

 

 

(549

)

 

 

(553

)

 

 

(810

)

 

 

(1,219

)

Charitable contributions resulting in state tax credits

 

(375

)

 

 

(375

)

 

 

(391

)

 

 

(350

)

 

 

(355

)

 

 

(750

)

 

 

(705

)

Voluntary early retirement program

 

 

 

 

 

 

 

 

 

 

(5,700

)

 

 

 

 

 

 

 

 

 

Regulatory settlement charge

 

 

 

 

 

 

 

 

 

 

 

(5,000

)

 

 

 

 

 

 

 

 

 

Adjusted noninterest expense (Non-GAAP)

(c)

$

122,441

 

 

$

120,627

 

 

$

118,194

 

 

$

116,644

 

 

$

116,260

 

 

$

243,068

 

 

$

236,468

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income (GAAP)

 

$

112,676

 

 

$

99,344

 

 

$

98,326

 

 

$

98,266

 

 

$

119,423

 

 

$

212,020

 

 

$

221,759

 

Add: Tax equivalent adjustment

 

 

2,916

 

 

 

3,003

 

 

 

2,906

 

 

 

2,947

 

 

 

2,957

 

 

 

5,919

 

 

 

5,851

 

Net interest income-FTE (Non-GAAP)

(a)

$

115,592

 

 

$

102,347

 

 

$

101,232

 

 

$

101,213

 

 

$

122,380

 

 

$

217,939

 

 

$

227,610

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income (GAAP)

 

$

53,253

 

 

$

54,115

 

 

$

50,767

 

 

$

54,149

 

 

$

56,411

 

 

$

107,368

 

 

$

116,994

 

Add: Partnership amortization for tax credit purposes

 

1,475

 

 

 

1,336

 

 

 

2,455

 

 

 

2,045

 

 

 

1,989

 

 

 

2,811

 

 

 

3,511

 

Adjusted noninterest income (Non-GAAP)

(b)

$

54,728

 

 

$

55,451

 

 

$

53,222

 

 

$

56,194

 

 

$

58,400

 

 

$

110,179

 

 

$

120,505

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted revenue (Non-GAAP)

(a)+(b)

$

170,320

 

 

$

157,798

 

 

$

154,454

 

 

$

157,407

 

 

$

180,780

 

 

$

328,118

 

 

$

348,115

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Efficiency ratio (Non-GAAP)

(c)/((a)+(b))

 

71.89

%

 

 

76.44

%

 

 

76.52

%

 

 

74.10

%

 

 

64.31

%

 

 

74.08

%

 

 

67.93

%

 

Contacts

Trustmark Investor Contacts:

Thomas C. Owens

Treasurer and Principal Financial Officer

601-208-7853

F. Joseph Rein, Jr.

Senior Vice President

601-208-6898

Trustmark Media Contact:

Melanie A. Morgan

Senior Vice President

601-208-2979

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