Trustmark Corporation Announces Second Quarter 2019 Financial Results

Loan growth, fee income expansion, disciplined expense management and strong credit quality reflected in performance

JACKSON, Miss.--()--Trustmark Corporation (NASDAQ:TRMK) reported net income of $42.1 million in the second quarter of 2019, representing diluted earnings per share of $0.65. Diluted earnings per share in the second quarter of 2019 increased 27.5% when compared to the previous quarter and 10.2% when compared to the same period in the prior year. This level of earnings resulted in a return on average tangible equity of 14.14% and a return on average assets of 1.24%. Trustmark’s Board of Directors declared a quarterly cash dividend of $0.23 per share payable September 15, 2019, to shareholders of record on September 1, 2019.

Printer friendly version of earnings release with consolidated financial statements and notes: https://www.businesswire.com/news/home/52016691/en

Second Quarter Highlights

  • Revenue, excluding interest and fees on acquired loans, increased 7.6% linked quarter and 5.3% year-over-year to total $155.4 million
  • The net interest margin (FTE), excluding acquired loans, was 3.60% in the second quarter, unchanged from the prior quarter and up 14 basis points year-over-year
  • Sustained strong credit performance reflected in reduced nonperforming assets and net charge-offs
  • Efficiency ratio improved to 64.55%

Gerard R. Host, President and CEO, stated, “Our second quarter performance continued to illustrate the value of Trustmark’s diverse franchise. We continued to focus upon strategic initiatives of profitable revenue growth, capital deployment through additional share repurchases and disciplined expense management. We also continued to maintain and expand customer relationships as evidenced by strength in our banking, mortgage, insurance and wealth management businesses. Thanks to our talented associates, solid profitability and strong capital base, Trustmark remains well positioned to continue meeting the needs of our customers and creating long-term value for our shareholders.”

Balance Sheet Management

  • Loans held for investment expanded 1.4% from the prior quarter and 5.0% when compared to the same period in the prior year
  • Continued balance sheet and capital optimization through maturing investment securities run-off and share repurchases
  • Noninterest-bearing deposits represented 25.2% of total deposits at June 30, 2019

Loans held for investment totaled $9.1 billion at June 30, 2019, reflecting an increase of $121.7 million, or 1.4%, linked-quarter and $437.8 million, or 5.0%, from the prior year. Acquired loans totaled $87.9 million at June 30, 2019, down $5.3 million from the prior quarter. Collectively, loans held for investment and acquired loans totaled $9.2 billion at the end of the second quarter of 2019, up $116.4 million, or 1.3% from the prior quarter and $352.6 million, or 4.0%, year-over-year.

Deposits totaled $11.6 billion at June 30, 2019, up $31.8 million from the prior quarter and $494.2 million year-over-year. Interest-bearing deposit costs totaled 0.99% in the second quarter, an increase of 6 basis points linked-quarter. Trustmark continues to maintain an attractive, low-cost deposit base with approximately 57% of deposit balances in checking accounts.

Trustmark’s capital position remained solid, reflecting the consistent profitability of its diversified financial services businesses. During the second quarter, Trustmark repurchased $13.0 million, or approximately 398 thousand of its common shares in open market transactions. At June 30, 2019, Trustmark had $87.0 million in remaining authority under its existing stock repurchase program, which expires March 31, 2020. At June 30, 2019, Trustmark’s tangible equity to tangible assets ratio was 9.34%, while the total risk-based capital ratio was 13.07%.

Credit Quality

  • Nonperforming loans decreased 6.3% and 13.8% from the prior quarter and year-over-year, respectively
  • Other real estate declined 2.8% from the prior quarter and 21.2% year-over-year
  • Net charge-offs represented 0.05% of average loans in the second quarter

Nonperforming loans totaled $52.9 million at June 30, 2019, down $3.5 million from the prior quarter and $8.5 million year-over-year. Other real estate totaled $31.2 million, down $896 thousand from the prior quarter and $8.4 million from the same period one year earlier. Collectively, nonperforming assets totaled $84.1 million, reflecting a linked-quarter decrease of 5.0% and year-over-year decrease of 16.7%.

Allocation of Trustmark's $80.4 million allowance for loan losses represented 0.96% of commercial loans and 0.60% of consumer and home mortgage loans, resulting in an allowance to total loans held for investment of 0.88% at June 30, 2019, representing a level management considers commensurate with the inherent risk in the loan portfolio. The allowance for loan losses represented 383.19% of nonperforming loans, excluding specifically reviewed impaired loans.

Unless otherwise noted, all of the above credit quality metrics exclude acquired loans.

Revenue Generation

  • Total revenue in the second quarter was $157.4 million, up 7.6% linked-quarter and 3.2% year-over-year
  • Net interest income (FTE) totaled $111.0 million in the second quarter, up 2.7% linked-quarter and 2.4% year-over-year
  • Noninterest income totaled $49.6 million in the second quarter, up 19.6% linked-quarter and 4.7% year-over-year

Net interest income (FTE) in the second quarter totaled $111.0 million, resulting in a net interest margin of 3.64%, up 1 basis point from the prior quarter. Relative to the prior quarter, net interest income (FTE) increased $2.9 million, reflecting a $4.7 million increase in interest income and a $1.7 million increase in interest expense. During the second quarter of 2019, the yield on acquired loans totaled 8.84% and included $583 thousand in recoveries from the settlement of debt, which represented approximately 2.56% of the annualized total acquired loan yield. Excluding acquired loans, the net interest margin totaled 3.60% for the second quarter of 2019, unchanged from the prior quarter as growth in the yield on the loans held for investment and held for sale portfolio, runoff of maturing investment securities, and favorable funding mix were offset by higher costs of interest-bearing deposits.

Noninterest income in the second quarter totaled $49.6 million, an increase of $8.1 million from the prior quarter and $2.2 million when compared to the same period in the prior year. Mortgage banking revenue totaled $10.3 million in the second quarter, up $6.9 million from the prior quarter and $1.2 million year-over-year. The linked-quarter change reflects reduced negative net mortgage hedge ineffectiveness as well as an increase in gains on sales of loans. Mortgage loan production in the second quarter totaled $414.1 million, up 46.1% from the prior quarter and 0.9% year-over-year.

Insurance revenue totaled $11.1 million in the second quarter, up 2.0% from the prior quarter and 3.3% year-over-year due principally to growth in property and casualty commissions. Wealth management revenue in the second quarter totaled $7.7 million, an increase of 3.5% from the prior quarter and year-over-year. This performance is primarily attributable to increased trust and investment management fees. Bank card and other fees increased $813 thousand from the prior quarter primarily due to a seasonal increase in interchange income as well as growth in customer derivative revenue.

Noninterest Expense

  • Total noninterest expense totaled $106.1 million in the second quarter, up 0.1% from the prior quarter and 2.2% year-over-year
  • Core noninterest expense, which excludes other real estate expense and intangible amortization, totaled $105.0 million, up 1.8% from the prior quarter and 2.3% year-over-year

Salaries and employee benefits increased $995 thousand from the prior quarter to total $61.9 million, primarily due to higher insurance and mortgage commissions as a result of continued growth in both business lines. Services and fees rose 6.1%, or $1.0 million, linked-quarter primarily due to professional fees as well as new software investments designed to improve efficiency and customer experience. Other real estate expense, net declined $1.6 million linked-quarter while other expense declined $397 thousand, or 3.3%, linked-quarter to total $11.8 million.

Additional Information

As previously announced, Trustmark will conduct a conference call with analysts on Wednesday, July 24, 2019 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 7, 2019, in archived format at the same web address or by calling (877) 344-7529, passcode 10132843.

Trustmark is a financial services company providing banking and financial solutions through 193 offices in Alabama, Florida, 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,” “potential,” “continue,” “could,” “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 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.

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, local, state and national economic and market conditions, including potential market impacts of efforts by the Federal Reserve Board to reduce the size of its balance sheet, 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 as well as 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 relating 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, acts of war or terrorism, and other risks described in our filings with the Securities and Exchange Commission.

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, 2019
($ in thousands)
(unaudited)
Linked Quarter Year over Year
QUARTERLY AVERAGE BALANCES 6/30/2019 3/31/2019 6/30/2018 $ Change % Change $ Change % Change
Securities AFS-taxable

$

1,661,464

 

$

1,753,268

 

$

2,038,759

 

$

(91,804

)

-5.2

%

$

(377,295

)

-18.5

%

Securities AFS-nontaxable

 

31,474

 

 

40,159

 

 

50,035

 

 

(8,685

)

-21.6

%

 

(18,561

)

-37.1

%

Securities HTM-taxable

 

821,357

 

 

866,665

 

 

972,571

 

 

(45,308

)

-5.2

%

 

(151,214

)

-15.5

%

Securities HTM-nontaxable

 

27,035

 

 

28,710

 

 

30,337

 

 

(1,675

)

-5.8

%

 

(3,302

)

-10.9

%

Total securities

 

2,541,330

 

 

2,688,802

 

 

3,091,702

 

 

(147,472

)

-5.5

%

 

(550,372

)

-17.8

%

Loans (including loans held for sale)

 

9,260,028

 

 

9,038,204

 

 

8,707,466

 

 

221,824

 

2.5

%

 

552,562

 

6.3

%

Acquired loans

 

91,217

 

 

104,316

 

 

202,140

 

 

(13,099

)

-12.6

%

 

(110,923

)

-54.9

%

Fed funds sold and rev repos

 

34,057

 

 

277

 

 

1,063

 

 

33,780

 

n/m

 

 

32,994

 

n/m

 

Other earning assets

 

316,604

 

 

243,493

 

 

186,224

 

 

73,111

 

30.0

%

 

130,380

 

70.0

%

Total earning assets

 

12,243,236

 

 

12,075,092

 

 

12,188,595

 

 

168,144

 

1.4

%

 

54,641

 

0.4

%

Allowance for loan losses

 

(81,996

)

 

(82,227

)

 

(86,315

)

 

231

 

0.3

%

 

4,319

 

5.0

%

Cash and due from banks

 

478,384

 

 

423,749

 

 

319,075

 

 

54,635

 

12.9

%

 

159,309

 

49.9

%

Other assets

 

989,078

 

 

1,023,862

 

 

1,042,156

 

 

(34,784

)

-3.4

%

 

(53,078

)

-5.1

%

Total assets

$

13,628,702

 

$

13,440,476

 

$

13,463,511

 

$

188,226

 

1.4

%

$

165,191

 

1.2

%

 
Interest-bearing demand deposits

$

3,048,876

 

$

2,899,467

 

$

2,439,777

 

$

149,409

 

5.2

%

$

609,099

 

25.0

%

Savings deposits

 

3,801,187

 

 

3,786,835

 

 

3,860,096

 

 

14,352

 

0.4

%

 

(58,909

)

-1.5

%

Time deposits

 

1,840,065

 

 

1,881,556

 

 

1,798,855

 

 

(41,491

)

-2.2

%

 

41,210

 

2.3

%

Total interest-bearing deposits

 

8,690,128

 

 

8,567,858

 

 

8,098,728

 

 

122,270

 

1.4

%

 

591,400

 

7.3

%

Fed funds purchased and repos

 

51,264

 

 

84,352

 

 

352,256

 

 

(33,088

)

-39.2

%

 

(300,992

)

-85.4

%

Other borrowings

 

81,352

 

 

90,804

 

 

249,853

 

 

(9,452

)

-10.4

%

 

(168,501

)

-67.4

%

Junior subordinated debt securities

 

61,856

 

 

61,856

 

 

61,856

 

0.0

%

0.0

%

Total interest-bearing liabilities

 

8,884,600

 

 

8,804,870

 

 

8,762,693

 

 

79,730

 

0.9

%

 

121,907

 

1.4

%

Noninterest-bearing deposits

 

2,898,266

 

 

2,824,220

 

 

2,930,726

 

 

74,046

 

2.6

%

 

(32,460

)

-1.1

%

Other liabilities

 

240,091

 

 

221,199

 

 

188,186

 

 

18,892

 

8.5

%

 

51,905

 

27.6

%

Total liabilities

 

12,022,957

 

 

11,850,289

 

 

11,881,605

 

 

172,668

 

1.5

%

 

141,352

 

1.2

%

Shareholders' equity

 

1,605,745

 

 

1,590,187

 

 

1,581,906

 

 

15,558

 

1.0

%

 

23,839

 

1.5

%

Total liabilities and equity

$

13,628,702

 

$

13,440,476

 

$

13,463,511

 

$

188,226

 

1.4

%

$

165,191

 

1.2

%

 

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, 2019
($ in thousands)
(unaudited) Linked Quarter Year over Year
PERIOD END BALANCES 6/30/2019 3/31/2019 6/30/2018 $ Change % Change $ Change % Change
Cash and due from banks

$

404,413

 

$

454,047

 

$

387,119

 

$

(49,634

)

-10.9

%

$

17,294

 

4.5

%

Fed funds sold and rev repos

 

75,499

 

 

75,499

 

n/m

 

 

75,499

 

n/m

 

Securities available for sale

 

1,643,725

 

 

1,723,445

 

 

1,974,675

 

 

(79,720

)

-4.6

%

 

(330,950

)

-16.8

%

Securities held to maturity

 

825,536

 

 

884,319

 

 

985,845

 

 

(58,783

)

-6.6

%

 

(160,309

)

-16.3

%

Loans held for sale (LHFS)

 

240,380

 

 

172,683

 

 

196,217

 

 

67,697

 

39.2

%

 

44,163

 

22.5

%

Loans held for investment (LHFI)

 

9,116,759

 

 

8,995,014

 

 

8,678,983

 

 

121,745

 

1.4

%

 

437,776

 

5.0

%

Allowance for loan losses, LHFI

 

(80,399

)

 

(79,005

)

 

(83,566

)

 

(1,394

)

-1.8

%

 

3,167

 

3.8

%

Net LHFI

 

9,036,360

 

 

8,916,009

 

 

8,595,417

 

 

120,351

 

1.3

%

 

440,943

 

5.1

%

Acquired loans

 

87,884

 

 

93,201

 

 

173,107

 

 

(5,317

)

-5.7

%

 

(85,223

)

-49.2

%

Allowance for loan losses, acquired loans

 

(1,398

)

 

(1,297

)

 

(3,046

)

 

(101

)

-7.8

%

 

1,648

 

54.1

%

Net acquired loans

 

86,486

 

 

91,904

 

 

170,061

 

 

(5,418

)

-5.9

%

 

(83,575

)

-49.1

%

Net LHFI and acquired loans

 

9,122,846

 

 

9,007,913

 

 

8,765,478

 

 

114,933

 

1.3

%

 

357,368

 

4.1

%

Premises and equipment, net

 

189,820

 

 

189,743

 

 

177,686

 

 

77

 

0.0

%

 

12,134

 

6.8

%

Mortgage servicing rights

 

79,283

 

 

86,842

 

 

97,411

 

 

(7,559

)

-8.7

%

 

(18,128

)

-18.6

%

Goodwill

 

379,627

 

 

379,627

 

 

379,627

 

 

0.0

%

 

0.0

%

Identifiable intangible assets

 

9,101

 

 

10,092

 

 

13,677

 

 

(991

)

-9.8

%

 

(4,576

)

-33.5

%

Other real estate

 

31,243

 

 

32,139

 

 

39,667

 

 

(896

)

-2.8

%

 

(8,424

)

-21.2

%

Operating lease right-of-use assets

 

32,762

 

 

33,861

 

 

 

(1,099

)

-3.2

%

 

32,762

 

n/m

 

Other assets

 

514,723

 

 

503,306

 

 

507,863

 

 

11,417

 

2.3

%

 

6,860

 

1.4

%

Total assets

$

13,548,958

 

$

13,478,017

 

$

13,525,265

 

$

70,941

 

0.5

%

$

23,693

 

0.2

%

 
Deposits:
Noninterest-bearing

$

2,909,141

 

$

2,867,778

 

$

2,958,354

 

$

41,363

 

1.4

%

$

(49,213

)

-1.7

%

Interest-bearing

 

8,657,488

 

 

8,667,037

 

 

8,114,081

 

 

(9,549

)

-0.1

%

 

543,407

 

6.7

%

Total deposits

 

11,566,629

 

 

11,534,815

 

 

11,072,435

 

 

31,814

 

0.3

%

 

494,194

 

4.5

%

Fed funds purchased and repos

 

51,800

 

 

46,867

 

 

477,891

 

 

4,933

 

10.5

%

 

(426,091

)

-89.2

%

Other borrowings

 

79,012

 

 

83,265

 

 

187,560

 

 

(4,253

)

-5.1

%

 

(108,548

)

-57.9

%

Junior subordinated debt securities

 

61,856

 

 

61,856

 

 

61,856

 

 

0.0

%

 

0.0

%

Operating lease liabilities

 

33,878

 

 

34,921

 

 

 

(1,043

)

-3.0

%

 

33,878

 

n/m

 

Other liabilities

 

137,233

 

 

129,265

 

 

141,451

 

 

7,968

 

6.2

%

 

(4,218

)

-3.0

%

Total liabilities

 

11,930,408

 

 

11,890,989

 

 

11,941,193

 

 

39,419

 

0.3

%

 

(10,785

)

-0.1

%

Common stock

 

13,418

 

 

13,499

 

 

14,089

 

 

(81

)

-0.6

%

 

(671

)

-4.8

%

Capital surplus

 

260,619

 

 

272,268

 

 

361,715

 

 

(11,649

)

-4.3

%

 

(101,096

)

-27.9

%

Retained earnings

 

1,369,329

 

 

1,342,176

 

 

1,282,007

 

 

27,153

 

2.0

%

 

87,322

 

6.8

%

Accum other comprehensive loss, net of tax

 

(24,816

)

 

(40,915

)

 

(73,739

)

 

16,099

 

39.3

%

 

48,923

 

66.3

%

Total shareholders' equity

 

1,618,550

 

 

1,587,028

 

 

1,584,072

 

 

31,522

 

2.0

%

 

34,478

 

2.2

%

Total liabilities and equity

$

13,548,958

 

$

13,478,017

 

$

13,525,265

 

$

70,941

 

0.5

%

$

23,693

 

0.2

%

 

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, 2019
($ in thousands except per share data)
(unaudited)
 
 
Quarter Ended Linked Quarter Year over Year
INCOME STATEMENTS 6/30/2019 3/31/2019 6/30/2018 $ Change % Change $ Change % Change
Interest and fees on LHFS & LHFI-FTE

$

114,873

$

109,890

$

99,761

 

$

4,983

 

4.5

%

$

15,112

 

15.1

%

Interest and fees on acquired loans

 

2,010

 

1,916

 

5,022

 

 

94

 

4.9

%

 

(3,012

)

-60.0

%

Interest on securities-taxable

 

13,916

 

14,665

 

16,894

 

 

(749

)

-5.1

%

 

(2,978

)

-17.6

%

Interest on securities-tax exempt-FTE

 

551

 

646

 

733

 

 

(95

)

-14.7

%

 

(182

)

-24.8

%

Interest on fed funds sold and rev repos

 

214

 

2

 

5

 

 

212

 

n/m

 

 

209

 

n/m

 

Other interest income

 

1,820

 

1,603

 

1,054

 

 

217

 

13.5

%

 

766

 

72.7

%

Total interest income-FTE

 

133,384

 

128,722

 

123,469

 

 

4,662

 

3.6

%

 

9,915

 

8.0

%

Interest on deposits

 

21,500

 

19,570

 

12,139

 

 

1,930

 

9.9

%

 

9,361

 

77.1

%

Interest on fed funds pch and repos

 

81

 

288

 

1,250

 

 

(207

)

-71.9

%

 

(1,169

)

-93.5

%

Other interest expense

 

831

 

825

 

1,713

 

 

6

 

0.7

%

 

(882

)

-51.5

%

Total interest expense

 

22,412

 

20,683

 

15,102

 

 

1,729

 

8.4

%

 

7,310

 

48.4

%

Net interest income-FTE

 

110,972

 

108,039

 

108,367

 

 

2,933

 

2.7

%

 

2,605

 

2.4

%

Provision for loan losses, LHFI

 

2,486

 

1,611

 

3,167

 

 

875

 

54.3

%

 

(681

)

-21.5

%

Provision for loan losses, acquired loans

 

106

 

78

 

(441

)

 

28

 

35.9

%

 

547

 

n/m

 

Net interest income after provision-FTE

 

108,380

 

106,350

 

105,641

 

 

2,030

 

1.9

%

 

2,739

 

2.6

%

Service charges on deposit accounts

 

10,379

 

10,265

 

10,647

 

 

114

 

1.1

%

 

(268

)

-2.5

%

Bank card and other fees

 

8,004

 

7,191

 

7,070

 

 

813

 

11.3

%

 

934

 

13.2

%

Mortgage banking, net

 

10,295

 

3,442

 

9,046

 

 

6,853

 

n/m

 

 

1,249

 

13.8

%

Insurance commissions

 

11,089

 

10,871

 

10,735

 

 

218

 

2.0

%

 

354

 

3.3

%

Wealth management

 

7,742

 

7,483

 

7,478

 

 

259

 

3.5

%

 

264

 

3.5

%

Other, net

 

2,130

 

2,239

 

2,415

 

 

(109

)

-4.9

%

 

(285

)

-11.8

%

Nonint inc-excl sec gains (losses), net

 

49,639

 

41,491

 

47,391

 

 

8,148

 

19.6

%

 

2,248

 

4.7

%

Security gains (losses), net

n/m

 

n/m

 

Total noninterest income

 

49,639

 

41,491

 

47,391

 

 

8,148

 

19.6

%

 

2,248

 

4.7

%

Salaries and employee benefits

 

61,949

 

60,954

 

59,975

 

 

995

 

1.6

%

 

1,974

 

3.3

%

Services and fees

 

18,009

 

16,968

 

16,322

 

 

1,041

 

6.1

%

 

1,687

 

10.3

%

Net occupancy-premises

 

6,403

 

6,454

 

6,550

 

 

(51

)

-0.8

%

 

(147

)

-2.2

%

Equipment expense

 

5,958

 

5,924

 

6,202

 

 

34

 

0.6

%

 

(244

)

-3.9

%

Other real estate expense, net

 

132

 

1,752

 

(93

)

 

(1,620

)

-92.5

%

 

225

 

n/m

 

FDIC assessment expense

 

1,836

 

1,758

 

2,538

 

 

78

 

4.4

%

 

(702

)

-27.7

%

Other expense

 

11,814

 

12,211

 

12,306

 

 

(397

)

-3.3

%

 

(492

)

-4.0

%

Total noninterest expense

 

106,101

 

106,021

 

103,800

 

 

80

 

0.1

%

 

2,301

 

2.2

%

Income before income taxes and tax eq adj

 

51,918

 

41,820

 

49,232

 

 

10,098

 

24.1

%

 

2,686

 

5.5

%

Tax equivalent adjustment

 

3,248

 

3,231

 

3,203

 

 

17

 

0.5

%

 

45

 

1.4

%

Income before income taxes

 

48,670

 

38,589

 

46,029

 

 

10,081

 

26.1

%

 

2,641

 

5.7

%

Income taxes

 

6,530

 

5,250

 

6,216

 

 

1,280

 

24.4

%

 

314

 

5.1

%

Net income

$

42,140

$

33,339

$

39,813

 

$

8,801

 

26.4

%

$

2,327

 

5.8

%

 
Per share data
Earnings per share - basic

$

0.65

$

0.51

$

0.59

 

$

0.14

 

27.5

%

$

0.06

 

10.2

%

 
Earnings per share - diluted

$

0.65

$

0.51

$

0.59

 

$

0.14

 

27.5

%

$

0.06

 

10.2

%

 
Dividends per share

$

0.23

$

0.23

$

0.23

 

 

0.0

%

 

0.0

%

 
Weighted average shares outstanding
Basic

 

64,677,889

 

65,239,470

 

67,758,097

 

 
Diluted

 

64,815,029

 

65,378,500

 

67,907,267

 

 
Period end shares outstanding

 

64,398,846

 

64,789,943

 

67,621,111

 

 

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, 2019
($ in thousands)
(unaudited)
Quarter Ended Linked Quarter Year over Year
NONPERFORMING ASSETS (1) 6/30/2019 3/31/2019 6/30/2018 $ Change % Change $ Change % Change
Nonaccrual loans
Alabama

$

2,327

 

$

2,971

 

$

3,685

 

$

(644

)

-21.7

%

$

(1,358

)

-36.9

%

Florida

 

330

 

 

408

 

 

2,978

 

 

(78

)

-19.1

%

 

(2,648

)

-88.9

%

Mississippi (2)

 

39,373

 

 

41,145

 

 

39,006

 

 

(1,772

)

-4.3

%

 

367

 

0.9

%

Tennessee (3)

 

8,455

 

 

8,806

 

 

5,338

 

 

(351

)

-4.0

%

 

3,117

 

58.4

%

Texas

 

2,403

 

 

3,093

 

 

10,356

 

 

(690

)

-22.3

%

 

(7,953

)

-76.8

%

Total nonaccrual loans

 

52,888

 

 

56,423

 

 

61,363

 

 

(3,535

)

-6.3

%

 

(8,475

)

-13.8

%

Other real estate
Alabama

 

6,451

 

 

6,878

 

 

8,290

 

 

(427

)

-6.2

%

 

(1,839

)

-22.2

%

Florida

 

7,826

 

 

8,120

 

 

9,789

 

 

(294

)

-3.6

%

 

(1,963

)

-20.1

%

Mississippi (2)

 

15,511

 

 

15,421

 

 

19,358

 

 

90

 

0.6

%

 

(3,847

)

-19.9

%

Tennessee (3)

 

815

 

 

994

 

 

1,486

 

 

(179

)

-18.0

%

 

(671

)

-45.2

%

Texas

 

640

 

 

726

 

 

744

 

 

(86

)

-11.8

%

 

(104

)

-14.0

%

Total other real estate

 

31,243

 

 

32,139

 

 

39,667

 

 

(896

)

-2.8

%

 

(8,424

)

-21.2

%

Total nonperforming assets

$

84,131

 

$

88,562

 

$

101,030

 

$

(4,431

)

-5.0

%

$

(16,899

)

-16.7

%

 
LOANS PAST DUE OVER 90 DAYS (1)
LHFI

$

1,245

 

$

670

 

$

529

 

$

575

 

85.8

%

$

716

 

n/m

 

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

$

38,355

 

$

40,793

 

$

34,693

 

$

(2,438

)

-6.0

%

$

3,662

 

10.6

%

 
Quarter Ended Linked Quarter Year over Year
ALLOWANCE FOR LOAN LOSSES (1) 6/30/2019 3/31/2019 6/30/2018 $ Change % Change $ Change % Change
Beginning Balance

$

79,005

 

$

79,290

 

$

81,235

 

$

(285

)

-0.4

%

$

(2,230

)

-2.7

%

Transfers (4)

 

 

 

782

 

 

n/m

 

 

(782

)

-100.0

%

Provision for loan losses

 

2,486

 

 

1,611

 

 

3,167

 

 

875

 

54.3

%

 

(681

)

-21.5

%

Charge-offs

 

(2,937

)

 

(4,033

)

 

(3,421

)

 

1,096

 

27.2

%

 

484

 

14.1

%

Recoveries

 

1,845

 

 

2,137

 

 

1,803

 

 

(292

)

-13.7

%

 

42

 

2.3

%

Net (charge-offs) recoveries

 

(1,092

)

 

(1,896

)

 

(1,618

)

 

804

 

42.4

%

 

526

 

-32.5

%

Ending Balance

$

80,399

 

$

79,005

 

$

83,566

 

$

1,394

 

1.8

%

$

(3,167

)

-3.8

%

 
PROVISION FOR LOAN LOSSES (1)
Alabama

$

1,187

 

$

791

 

$

434

 

$

396

 

50.1

%

$

753

 

n/m

 

Florida

 

48

 

 

(595

)

 

(811

)

 

643

 

n/m

 

 

859

 

n/m

 

Mississippi (2)

 

1,970

 

 

119

 

 

2,768

 

 

1,851

 

n/m

 

 

(798

)

-28.8

%

Tennessee (3)

 

514

 

 

(234

)

 

82

 

 

748

 

n/m

 

 

432

 

n/m

 

Texas

 

(1,233

)

 

1,530

 

 

694

 

 

(2,763

)

n/m

 

 

(1,927

)

n/m

 

Total provision for loan losses

$

2,486

 

$

1,611

 

$

3,167

 

$

875

 

54.3

%

$

(681

)

-21.5

%

 
NET CHARGE-OFFS (RECOVERIES) (1)
Alabama

$

278

 

$

15

 

$

112

 

$

263

 

n/m

 

$

166

 

n/m

 

Florida

 

(130

)

 

(227

)

 

(122

)

 

97

 

42.7

%

 

(8

)

-6.6

%

Mississippi (2)

 

907

 

 

2,130

 

 

1,705

 

 

(1,223

)

-57.4

%

 

(798

)

-46.8

%

Tennessee (3)

 

44

 

 

50

 

 

70

 

 

(6

)

-12.0

%

 

(26

)

-37.1

%

Texas

 

(7

)

 

(72

)

 

(147

)

 

65

 

90.3

%

 

140

 

95.2

%

Total net charge-offs (recoveries)

$

1,092

 

$

1,896

 

$

1,618

 

$

(804

)

-42.4

%

$

(526

)

-32.5

%

 (1)

Excludes acquired loans.

 (2)

Mississippi includes Central and Southern Mississippi Regions.

 (3)

Tennessee includes Memphis, Tennessee and Northern Mississippi Regions.

 (4)

The allowance for loan losses balance related to the remaining loans acquired in the Bay Bank merger, which were transferred from acquired impaired loans to LHFI during the second quarter of 2018.
 
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, 2019
($ in thousands)
(unaudited)
Quarter Ended Six Months Ended
AVERAGE BALANCES 6/30/2019 3/31/2019 12/31/2018 9/30/2018 6/30/2018 6/30/2019 6/30/2018
Securities AFS-taxable

$

 

1,661,464

 

$

 

1,753,268

 

$

 

1,847,421

 

$

 

1,937,807

 

$

 

2,038,759

 

$

 

1,707,112

 

$

 

2,089,669

 

Securities AFS-nontaxable

 

31,474

 

 

40,159

 

 

38,821

 

 

41,889

 

 

50,035

 

 

35,793

 

 

53,982

 

Securities HTM-taxable

 

821,357

 

 

866,665

 

 

893,186

 

 

933,294

 

 

972,571

 

 

843,886

 

 

989,054

 

Securities HTM-nontaxable

 

27,035

 

 

28,710

 

 

29,143

 

 

29,183

 

 

30,337

 

 

27,868

 

 

31,529

 

Total securities

 

2,541,330

 

 

2,688,802

 

 

2,808,571

 

 

2,942,173

 

 

3,091,702

 

 

2,614,659

 

 

3,164,234

 

Loans (including loans held for sale)

 

9,260,028

 

 

9,038,204

 

 

8,933,501

 

 

8,907,588

 

 

8,707,466

 

 

9,149,729

 

 

8,672,411

 

Acquired loans

 

91,217

 

 

104,316

 

 

127,747

 

 

147,811

 

 

202,140

 

 

97,730

 

 

222,533

 

Fed funds sold and rev repos

 

34,057

 

 

277

 

 

843

 

 

477

 

 

1,063

 

 

17,260

 

 

772

 

Other earning assets

 

316,604

 

 

243,493

 

 

200,282

 

 

189,471

 

 

186,224

 

 

280,250

 

 

200,028

 

Total earning assets

 

12,243,236

 

 

12,075,092

 

 

12,070,944

 

 

12,187,520

 

 

12,188,595

 

 

12,159,628

 

 

12,259,978

 

Allowance for loan losses

 

(81,996

)

 

(82,227

)

 

(85,842

)

 

(86,496

)

 

(86,315

)

 

(82,111

)

 

(84,321

)

Cash and due from banks

 

478,384

 

 

423,749

 

 

339,605

 

 

330,949

 

 

319,075

 

 

451,217

 

 

327,810

 

Other assets

 

989,078

 

 

1,023,862

 

 

1,023,226

 

 

1,035,327

 

 

1,042,156

 

 

1,006,375

 

 

1,036,478

 

Total assets

$

 

13,628,702

 

$

 

13,440,476

 

$

 

13,347,933

 

$

 

13,467,300

 

$

 

13,463,511

 

$

 

13,535,109

 

$

 

13,539,945

 

 
Interest-bearing demand deposits

$

 

3,048,876

 

$

 

2,899,467

 

$

 

2,722,841

 

$

 

2,602,658

 

$

 

2,439,777

 

$

 

2,974,584

 

$

 

2,422,200

 

Savings deposits

 

3,801,187

 

 

3,786,835

 

 

3,565,682

 

 

3,722,533

 

 

3,860,096

 

 

3,794,051

 

 

3,799,140

 

Time deposits

 

1,840,065

 

 

1,881,556

 

 

1,892,983

 

 

1,851,866

 

 

1,798,855

 

 

1,860,696

 

 

1,773,889

 

Total interest-bearing deposits

 

8,690,128

 

 

8,567,858

 

 

8,181,506

 

 

8,177,057

 

 

8,098,728

 

 

8,629,331

 

 

7,995,229

 

Fed funds purchased and repos

 

51,264

 

 

84,352

 

 

340,094

 

 

347,489

 

 

352,256

 

 

67,717

 

 

315,272

 

Other borrowings

 

81,352

 

 

90,804

 

 

90,252

 

 

187,196

 

 

249,853

 

 

86,052

 

 

499,617

 

Junior subordinated debt securities

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

Total interest-bearing liabilities

 

8,884,600

 

 

8,804,870

 

 

8,673,708

 

 

8,773,598

 

 

8,762,693

 

 

8,844,956

 

 

8,871,974

 

Noninterest-bearing deposits

 

2,898,266

 

 

2,824,220

 

 

2,862,161

 

 

2,894,061

 

 

2,930,726

 

 

2,861,448

 

 

2,906,186

 

Other liabilities

 

240,091

 

 

221,199

 

 

216,932

 

 

202,053

 

 

188,186

 

 

230,696

 

 

184,549

 

Total liabilities

 

12,022,957

 

 

11,850,289

 

 

11,752,801

 

 

11,869,712

 

 

11,881,605

 

 

11,937,100

 

 

11,962,709

 

Shareholders' equity

 

1,605,745

 

 

1,590,187

 

 

1,595,132

 

 

1,597,588

 

 

1,581,906

 

 

1,598,009

 

 

1,577,236

 

Total liabilities and equity

$

 

13,628,702

 

$

 

13,440,476

 

$

 

13,347,933

 

$

 

13,467,300

 

$

 

13,463,511

 

$

 

13,535,109

 

$

 

13,539,945

 

 

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2019
($ in thousands)
(unaudited)
 
PERIOD END BALANCES 6/30/2019 3/31/2019 12/31/2018 9/30/2018 6/30/2018
Cash and due from banks

$

404,413

 

$

454,047

 

$

349,561

 

$

432,471

 

$

387,119

 

Fed funds sold and rev repos

 

75,499

 

 

 

830

 

 

1,000

 

 

Securities available for sale

 

1,643,725

 

 

1,723,445

 

 

1,811,813

 

 

1,864,633

 

 

1,974,675

 

Securities held to maturity

 

825,536

 

 

884,319

 

 

909,643

 

 

943,883

 

 

985,845

 

Loans held for sale (LHFS)

 

240,380

 

 

172,683

 

 

153,799

 

 

182,664

 

 

196,217

 

Loans held for investment (LHFI)

 

9,116,759

 

 

8,995,014

 

 

8,835,868

 

 

8,747,030

 

 

8,678,983

 

Allowance for loan losses, LHFI

 

(80,399

)

 

(79,005

)

 

(79,290

)

 

(88,874

)

 

(83,566

)

Net LHFI

 

9,036,360

 

 

8,916,009

 

 

8,756,578

 

 

8,658,156

 

 

8,595,417

 

Acquired loans

 

87,884

 

 

93,201

 

 

106,932

 

 

132,615

 

 

173,107

 

Allowance for loan losses, acquired loans

 

(1,398

)

 

(1,297

)

 

(1,231

)

 

(1,714

)

 

(3,046

)

Net acquired loans

 

86,486

 

 

91,904

 

 

105,701

 

 

130,901

 

 

170,061

 

Net LHFI and acquired loans

 

9,122,846

 

 

9,007,913

 

 

8,862,279

 

 

8,789,057

 

 

8,765,478

 

Premises and equipment, net

 

189,820

 

 

189,743

 

 

178,668

 

 

178,739

 

 

177,686

 

Mortgage servicing rights

 

79,283

 

 

86,842

 

 

95,596

 

 

101,374

 

 

97,411

 

Goodwill

 

379,627

 

 

379,627

 

 

379,627

 

 

379,627

 

 

379,627

 

Identifiable intangible assets

 

9,101

 

 

10,092

 

 

11,112

 

 

12,391

 

 

13,677

 

Other real estate

 

31,243

 

 

32,139

 

 

34,668

 

 

36,475

 

 

39,667

 

Operating lease right-of-use assets

 

32,762

 

 

33,861

 

 

 

 

Other assets

 

514,723

 

 

503,306

 

 

498,864

 

 

517,498

 

 

507,863

 

Total assets

$

13,548,958

 

$

13,478,017

 

$

13,286,460

 

$

13,439,812

 

$

13,525,265

 

 
Deposits:
Noninterest-bearing

$

2,909,141

 

$

2,867,778

 

$

2,937,594

 

$

2,786,539

 

$

2,958,354

 

Interest-bearing

 

8,657,488

 

 

8,667,037

 

 

8,426,817

 

 

8,170,371

 

 

8,114,081

 

Total deposits

 

11,566,629

 

 

11,534,815

 

 

11,364,411

 

 

10,956,910

 

 

11,072,435

 

Fed funds purchased and repos

 

51,800

 

 

46,867

 

 

50,471

 

 

486,865

 

 

477,891

 

Other borrowings

 

79,012

 

 

83,265

 

 

79,885

 

 

190,919

 

 

187,560

 

Junior subordinated debt securities

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

 

61,856

 

Operating lease liabilities

 

33,878

 

 

34,921

 

 

 

 

Other liabilities

 

137,233

 

 

129,265

 

 

138,384

 

 

143,658

 

 

141,451

 

Total liabilities

 

11,930,408

 

 

11,890,989

 

 

11,695,007

 

 

11,840,208

 

 

11,941,193

 

Common stock

 

13,418

 

 

13,499

 

 

13,717

 

 

14,089

 

 

14,089

 

Capital surplus

 

260,619

 

 

272,268

 

 

309,545

 

 

362,868

 

 

361,715

 

Retained earnings

 

1,369,329

 

 

1,342,176

 

 

1,323,870

 

 

1,302,593

 

 

1,282,007

 

Accum other comprehensive loss, net of tax

 

(24,816

)

 

(40,915

)

 

(55,679

)

 

(79,946

)

 

(73,739

)

Total shareholders' equity

 

1,618,550

 

 

1,587,028

 

 

1,591,453

 

 

1,599,604

 

 

1,584,072

 

Total liabilities and equity

$

13,548,958

 

$

13,478,017

 

$

13,286,460

 

$

13,439,812

 

$

13,525,265

 

 

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2019
($ in thousands except per share data)
(unaudited)
 
Quarter Ended Six Months Ended
INCOME STATEMENTS 6/30/2019 3/31/2019 12/31/2018 9/30/2018 6/30/2018 6/30/2019 6/30/2018
Interest and fees on LHFS & LHFI-FTE

$

114,873

$

109,890

$

107,709

 

$

105,993

 

$

99,761

 

$

224,763

$

194,473

 

Interest and fees on acquired loans

 

2,010

 

1,916

 

3,183

 

 

4,033

 

 

5,022

 

 

3,926

 

9,899

 

Interest on securities-taxable

 

13,916

 

14,665

 

15,496

 

 

16,186

 

 

16,894

 

 

28,581

 

34,400

 

Interest on securities-tax exempt-FTE

 

551

 

646

 

617

 

 

656

 

 

733

 

 

1,197

 

1,557

 

Interest on fed funds sold and rev repos

 

214

 

2

 

4

 

 

3

 

 

5

 

 

216

 

7

 

Other interest income

 

1,820

 

1,603

 

1,158

 

 

1,050

 

 

1,054

 

 

3,423

 

1,988

 

Total interest income-FTE

 

133,384

 

128,722

 

128,167

 

 

127,921

 

 

123,469

 

 

262,106

 

242,324

 

Interest on deposits

 

21,500

 

19,570

 

17,334

 

 

14,972

 

 

12,139

 

 

41,070

 

21,630

 

Interest on fed funds pch and repos

 

81

 

288

 

1,528

 

 

1,348

 

 

1,250

 

 

369

 

1,912

 

Other interest expense

 

831

 

825

 

894

 

 

1,467

 

 

1,713

 

 

1,656

 

5,107

 

Total interest expense

 

22,412

 

20,683

 

19,756

 

 

17,787

 

 

15,102

 

 

43,095

 

28,649

 

Net interest income-FTE

 

110,972

 

108,039

 

108,411

 

 

110,134

 

 

108,367

 

 

219,011

 

213,675

 

Provision for loan losses, LHFI

 

2,486

 

1,611

 

2,192

 

 

8,673

 

 

3,167

 

 

4,097

 

7,128

 

Provision for loan losses, acquired loans

 

106

 

78

 

(247

)

 

(467

)

 

(441

)

 

184

 

(291

)

Net interest income after provision-FTE

 

108,380

 

106,350

 

106,466

 

 

101,928

 

 

105,641

 

 

214,730

 

206,838

 

Service charges on deposit accounts

 

10,379

 

10,265

 

11,123

 

 

11,075

 

 

10,647

 

 

20,644

 

21,504

 

Bank card and other fees

 

8,004

 

7,191

 

7,750

 

 

7,459

 

 

7,070

 

 

15,195

 

13,696

 

Mortgage banking, net

 

10,295

 

3,442

 

5,716

 

 

8,647

 

 

9,046

 

 

13,737

 

20,311

 

Insurance commissions

 

11,089

 

10,871

 

9,562

 

 

10,765

 

 

10,735

 

 

21,960

 

20,154

 

Wealth management

 

7,742

 

7,483

 

7,504

 

 

7,789

 

 

7,478

 

 

15,225

 

15,045

 

Other, net

 

2,130

 

2,239

 

1,904

 

 

1,358

 

 

2,415

 

 

4,369

 

3,474

 

Nonint inc-excl sec gains (losses), net

 

49,639

 

41,491

 

43,559

 

 

47,093

 

 

47,391

 

 

91,130

 

94,184

 

Security gains (losses), net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest income

 

49,639

 

41,491

 

43,559

 

 

47,093

 

 

47,391

 

 

91,130

 

94,184

 

Salaries and employee benefits

 

61,949

 

60,954

 

58,736

 

 

60,847

 

 

59,975

 

 

122,903

 

118,450

 

Services and fees

 

18,009

 

16,968

 

17,910

 

 

16,404

 

 

16,322

 

 

34,977

 

32,068

 

Net occupancy-premises

 

6,403

 

6,454

 

6,741

 

 

6,910

 

 

6,550

 

 

12,857

 

13,052

 

Equipment expense

 

5,958

 

5,924

 

6,329

 

 

6,200

 

 

6,202

 

 

11,882

 

12,301

 

Other real estate expense, net

 

132

 

1,752

 

61

 

 

1,168

 

 

(93

)

 

1,884

 

773

 

FDIC assessment expense

 

1,836

 

1,758

 

1,897

 

 

1,999

 

 

2,538

 

 

3,594

 

5,533

 

Other expense

 

11,814

 

12,211

 

12,253

 

 

11,695

 

 

12,306

 

 

24,025

 

24,088

 

Total noninterest expense

 

106,101

 

106,021

 

103,927

 

 

105,223

 

 

103,800

 

 

212,122

 

206,265

 

Income before income taxes and tax eq adj

 

51,918

 

41,820

 

46,098

 

 

43,798

 

 

49,232

 

 

93,738

 

94,757

 

Tax equivalent adjustment

 

3,248

 

3,231

 

3,231

 

 

3,151

 

 

3,203

 

 

6,479

 

6,418

 

Income before income taxes

 

48,670

 

38,589

 

42,867

 

 

40,647

 

 

46,029

 

 

87,259

 

88,339

 

Income taxes

 

6,530

 

5,250

 

6,179

 

 

4,394

 

 

6,216

 

 

11,780

 

11,696

 

Net income

$

42,140

$

33,339

$

36,688

 

$

36,253

 

$

39,813

 

$

75,479

$

76,643

 

 
Per share data
Earnings per share - basic

$

0.65

$

0.51

$

0.55

 

$

0.54

 

$

0.59

 

$

1.16

$

1.13

 

 
Earnings per share - diluted

$

0.65

$

0.51

$

0.55

 

$

0.54

 

$

0.59

 

$

1.16

$

1.13

 

 
Dividends per share

$

0.23

$

0.23

$

0.23

 

$

0.23

 

$

0.23

 

$

0.46

$

0.46

 

 
Weighted average shares outstanding
Basic

 

64,677,889

 

65,239,470

 

66,839,504

 

 

67,621,345

 

 

67,758,097

 

 

64,957,128

 

67,783,524

 

 
Diluted

 

64,815,029

 

65,378,500

 

67,028,978

 

 

67,796,346

 

 

67,907,267

 

 

65,088,908

 

67,928,829

 

 
Period end shares outstanding

 

64,398,846

 

64,789,943

 

65,834,395

 

 

67,621,369

 

 

67,621,111

 

 

64,398,846

 

67,621,111

 

 

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2019
($ in thousands)
(unaudited)
 
 
Quarter Ended
NONPERFORMING ASSETS (1) 6/30/2019 3/31/2019 12/31/2018 9/30/2018 6/30/2018
Nonaccrual loans
Alabama

$

2,327

 

$

2,971

 

$

3,361

 

$

3,953

 

$

3,685

 

Florida

 

330

 

 

408

 

 

1,175

 

 

1,180

 

 

2,978

 

Mississippi (2)

 

39,373

 

 

41,145

 

 

44,331

 

 

41,351

 

 

39,006

 

Tennessee (3)

 

8,455

 

 

8,806

 

 

8,696

 

 

13,195

 

 

5,338

 

Texas

 

2,403

 

 

3,093

 

 

4,061

 

 

8,157

 

 

10,356

 

Total nonaccrual loans

 

52,888

 

 

56,423

 

 

61,624

 

 

67,836

 

 

61,363

 

Other real estate
Alabama

 

6,451

 

 

6,878

 

 

6,873

 

 

7,526

 

 

8,290

 

Florida

 

7,826

 

 

8,120

 

 

8,771

 

 

8,931

 

 

9,789

 

Mississippi (2)

 

15,511

 

 

15,421

 

 

17,255

 

 

18,191

 

 

19,358

 

Tennessee (3)

 

815

 

 

994

 

 

1,025

 

 

1,083

 

 

1,486

 

Texas

 

640

 

 

726

 

 

744

 

 

744

 

 

744

 

Total other real estate

 

31,243

 

 

32,139

 

 

34,668

 

 

36,475

 

 

39,667

 

Total nonperforming assets

$

84,131

 

$

88,562

 

$

96,292

 

$

104,311

 

$

101,030

 

 
LOANS PAST DUE OVER 90 DAYS (1)
LHFI

$

1,245

 

$

670

 

$

856

 

$

726

 

$

529

 

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

$

38,355

 

$

40,793

 

$

37,384

 

$

34,115

 

$

34,693

 

 
 
Quarter Ended Six Months Ended
ALLOWANCE FOR LOAN LOSSES (1) 6/30/2019 3/31/2019 12/31/2018 9/30/2018 6/30/2018 6/30/2019 6/30/2018
Beginning Balance

$

79,005

 

$

79,290

 

$

88,874

 

$

83,566

 

$

81,235

 

$

79,290

 

$

76,733

 

Transfers (4)

 

 

 

 

772

 

 

782

 

 

 

782

 

Provision for loan losses

 

2,486

 

 

1,611

 

 

2,192

 

 

8,673

 

 

3,167

 

 

4,097

 

 

7,128

 

Charge-offs

 

(2,937

)

 

(4,033

)

 

(16,509

)

 

(7,017

)

 

(3,421

)

 

(6,970

)

 

(5,963

)

Recoveries

 

1,845

 

 

2,137

 

 

4,733

 

 

2,880

 

 

1,803

 

 

3,982

 

 

4,886

 

Net (charge-offs) recoveries

 

(1,092

)

 

(1,896

)

 

(11,776

)

 

(4,137

)

 

(1,618

)

 

(2,988

)

 

(1,077

)

Ending Balance

$

80,399

 

$

79,005

 

$

79,290

 

$

88,874

 

$

83,566

 

$

80,399

 

$

83,566

 

 
PROVISION FOR LOAN LOSSES (1)
Alabama

$

1,187

 

$

791

 

$

(346

)

$

593

 

$

434

 

$

1,978

 

$

1,052

 

Florida

 

48

 

 

(595

)

 

(160

)

 

(431

)

 

(811

)

 

(547

)

 

(1,674

)

Mississippi (2)

 

1,970

 

 

119

 

 

(3,594

)

 

(1,630

)

 

2,768

 

 

2,089

 

 

5,432

 

Tennessee (3)

 

514

 

 

(234

)

 

3,039

 

 

8,100

 

 

82

 

 

280

 

 

(186

)

Texas

 

(1,233

)

 

1,530

 

 

3,253

 

 

2,041

 

 

694

 

 

297

 

 

2,504

 

Total provision for loan losses

$

2,486

 

$

1,611

 

$

2,192

 

$

8,673

 

$

3,167

 

$

4,097

 

$

7,128

 

 
NET CHARGE-OFFS (RECOVERIES) (1)
Alabama

$

278

 

$

15

 

$

203

 

$

198

 

$

112

 

$

293

 

$

196

 

Florida

 

(130

)

 

(227

)

 

(238

)

 

(586

)

 

(122

)

 

(357

)

 

(1,082

)

Mississippi (2)

 

907

 

 

2,130

 

 

(1,873

)

 

4,677

 

 

1,705

 

 

3,037

 

 

1,972

 

Tennessee (3)

 

44

 

 

50

 

 

7,875

 

 

(96

)

 

70

 

 

94

 

 

179

 

Texas

 

(7

)

 

(72

)

 

5,809

 

 

(56

)

 

(147

)

 

(79

)

 

(188

)

Total net charge-offs (recoveries)

$

1,092

 

$

1,896

 

$

11,776

 

$

4,137

 

$

1,618

 

$

2,988

 

$

1,077

 

 

 (1)

Excludes acquired loans.

 (2)

Mississippi includes Central and Southern Mississippi Regions.

 (3)

Tennessee includes Memphis, Tennessee and Northern Mississippi Regions.

 (4)

The allowance for loan losses balance related to the remaining loans acquired in the Bay Bank merger, which were transferred from acquired impaired loans to LHFI during the second quarter of 2018, and the remaining loans acquired in the Heritage acquisition and the Reliance merger, which were transferred from acquired impaired loans to LHFI during the third quarter of 2018.
 
 

See Notes to Consolidated Financials

 

 

 

TRUSTMARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION
June 30, 2019
(unaudited)
 
Quarter Ended Six Months Ended
FINANCIAL RATIOS AND OTHER DATA 6/30/2019 3/31/2019 12/31/2018 9/30/2018 6/30/2018 6/30/2019 6/30/2018
Return on equity

 

10.53

%

 

8.50

%

 

9.12

%

 

9.00

%

 

10.09

%

9.52

%

9.80

%

Return on average tangible equity

 

14.14

%

 

11.55

%

 

12.41

%

 

12.26

%

 

13.77

%

12.86

%

13.41

%

Return on assets

 

1.24

%

 

1.01

%

 

1.09

%

 

1.07

%

 

1.19

%

1.12

%

1.14

%

Interest margin - Yield - FTE

 

4.37

%

 

4.32

%

 

4.21

%

 

4.16

%

 

4.06

%

4.35

%

3.99

%

Interest margin - Cost

 

0.73

%

 

0.69

%

 

0.65

%

 

0.58

%

 

0.50

%

0.71

%

0.47

%

Net interest margin - FTE

 

3.64

%

 

3.63

%

 

3.56

%

 

3.59

%

 

3.57

%

3.63

%

3.51

%

Efficiency ratio (1)

 

64.55

%

 

68.08

%

 

66.58

%

 

64.46

%

 

64.96

%

66.25

%

64.95

%

Full-time equivalent employees

 

2,819

 

 

2,839

 

 

2,856

 

 

2,889

 

 

2,890

 

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

 

0.05

%

 

0.09

%

 

0.52

%

 

0.18

%

 

0.07

%

0.07

%

0.03

%

Provision for loan losses/average loans

 

0.11

%

 

0.07

%

 

0.10

%

 

0.39

%

 

0.15

%

0.09

%

0.17

%

Nonperforming loans/total loans (incl LHFS)

 

0.57

%

 

0.62

%

 

0.69

%

 

0.76

%

 

0.69

%

Nonperforming assets/total loans (incl LHFS)

 

0.90

%

 

0.97

%

 

1.07

%

 

1.17

%

 

1.14

%

Nonperforming assets/total loans (incl LHFS) +ORE

 

0.90

%

 

0.96

%

 

1.07

%

 

1.16

%

 

1.13

%

ALL/total loans (excl LHFS)

 

0.88

%

 

0.88

%

 

0.90

%

 

1.02

%

 

0.96

%

ALL-commercial/total commercial loans

 

0.96

%

 

0.96

%

 

0.99

%

 

1.13

%

 

1.05

%

ALL-consumer/total consumer and home mortgage loans

 

0.60

%

 

0.57

%

 

0.57

%

 

0.63

%

 

0.63

%

ALL/nonperforming loans

 

152.02

%

 

140.02

%

 

128.67

%

 

131.01

%

 

136.18

%

ALL/nonperforming loans (excl specifically reviewed impaired loans)

 

383.19

%

 

342.97

%

 

350.77

%

 

339.79

%

 

345.87

%

 
CAPITAL RATIOS
Total equity/total assets

 

11.95

%

 

11.77

%

 

11.98

%

 

11.90

%

 

11.71

%

Tangible equity/tangible assets

 

9.34

%

 

9.15

%

 

9.31

%

 

9.26

%

 

9.07

%

Tangible equity/risk-weighted assets

 

11.39

%

 

11.35

%

 

11.11

%

 

11.31

%

 

11.20

%

Tier 1 leverage ratio

 

10.03

%

 

10.05

%

 

10.26

%

 

10.41

%

 

10.22

%

Common equity tier 1 capital ratio

 

11.76

%

 

11.88

%

 

11.77

%

 

12.20

%

 

12.01

%

Tier 1 risk-based capital ratio

 

12.31

%

 

12.45

%

 

12.33

%

 

12.76

%

 

12.58

%

Total risk-based capital ratio

 

13.07

%

 

13.21

%

 

13.07

%

 

13.61

%

 

13.39

%

 
STOCK PERFORMANCE
Market value-Close

$

33.25

 

$

33.63

 

$

28.43

 

$

33.65

 

$

32.63

 

Book value

$

25.13

 

$

24.49

 

$

24.17

 

$

23.66

 

$

23.43

 

Tangible book value

$

19.10

 

$

18.48

 

$

18.24

 

$

17.86

 

$

17.61

 

 (1)

The efficiency ratio is noninterest expense (excluding amortization of purchased intangibles and other real estate expense, net) to total net interest income (FTE) and noninterest income (excluding security gains (losses), net and amortization of partnership tax credits). Any significant non-routine income and