 | News Release |
Trustmark Corporation Announces First Quarter 2010 Financial Results
and Declares $0.23 Quarterly Cash Dividend
Jackson, MS – April 27, 2010 – Trustmark Corporation (NASDAQ:TRMK) announced net income available to common shareholders of $23.5 million in the first quarter of 2010, which represented basic earnings per common share of $0.37. Trustmark’s first quarter net income produced a return on average tangible common equity of 11.98%. Trustmark’s Board of Directors declared a quarterly cash dividend of $0.23 per common share. The dividend is payable June 15, 2010, to shareholders of record on June 1, 2010.
Richard G. Hickson, Chairman and CEO, stated, “Trustmark continued to produce strong financial results as reflected by our robust net interest margin, solid noninterest income, disciplined management of noninterest expense, and enhanced capital strength. We continue to look forward to the future as solid earnings, coupled with the strength of Trustmark’s human and financial capital, have positioned us to take advantage of growth opportunities in the marketplace and build shareholder value.”
Credit Quality
| · | Florida construction and land development exposure declined 33.5% in 12 months |
| · | Allowance for loan losses represented 131% of nonperforming loans (excluding impaired loans) |
Trustmark continued to make significant progress in the resolution of its construction and land development portfolio in Florida. During the last 12 months, this portfolio has been reduced by 33.5% to $183.7 million. At March 31, 2010, Florida nonimpaired construction and land development loans totaled $148.8 million with an associated reserve for loan losses of $19.6 million, or 13.20%. Managing credit risks resulting from current economic and real estate market conditions continues to be a primary focus for Trustmark.
During the first quarter, nonperforming loans increased $24.3 million relative to the prior quarter to total $165.5 million, or 2.61% of total loans. This increase was principally attributable to three residential real estate development credits in the Corporation’s Mississippi and Texas markets which were impaired and written down to net realizable value. Foreclosed real estate increased $1.1 million to total $91.2 million as continued progress was made in the disposition of foreclosed properties in the Corporation’s Florida market. At March 31, 2010, nonperforming assets totaled $256.7 million, representing 3.99% of total loans and other real estate.
Net charge-offs totaled $17.1 million, or 1.08% of average loans, while the provision for loan losses totaled $15.1 million during the first quarter. Allocation of Trustmark’s $101.6 million allowance for loan losses represented 2.10% of commercial loans and 0.80% of consumer and home mortgage loans, resulting in an allowance to total loans of 1.65% as of March 31, 2010.
Capital Strength
| · | Tangible common equity to tangible assets expanded to 9.11% |
| · | Total risk-based capital increased to 15.15%, significantly exceeding “well-capitalized” standards |
Sound balance sheet management and consistent profitability continued to be reflected in Trustmark’s solid capital base. At March 31, 2010, tangible common equity totaled $818.5 million and represented 9.11% of tangible assets. Total risk-based capital increased to 15.15%, significantly exceeding the 10% regulatory requirement to be classified as “well-capitalized.” Trustmark’s strong capital base will support organic growth as well as acquisition opportunities that strengthen the value of the franchise.
Pre-tax, pre-provision earnings of $49.4 million in the first quarter of 2010 continued to reflect the fundamental strengths of Trustmark’s diversified financial services businesses. Based upon the existing capital base and the expectation of the level of profitability going forward, Trustmark continues to believe in the sustainability of its cash dividend to shareholders.
Balance Sheet Management
| · | Net interest margin expanded to 4.42% |
| · | Net interest income totaled $90.7 million |
Average loans in the first quarter totaled $6.4 billion, a decline of $131.8 million from the prior quarter. This reduction continued to reflect efforts to reduce exposure to construction and land development lending as well as the decision to discontinue indirect auto financing. Current economic conditions also reduced demand for credit. Average investment securities increased $124.9 million during the first quarter to $1.8 billion. As a result of reduced loan balances and increased investment securities, average earning assets remained stable at $8.3 billion during the first quarter.
Average deposits totaled $7.1 billion, an increase of $198.0 million relative to the prior quarter. Lower deposit cost during the first quarter reflected Trustmark’s strong liquidity while disciplined loan pricing and required minimum loan rates continued to sustain loan yields. As a result, net interest income totaled $90.7 million during the first quarter while the net interest margin expanded to 4.42%.
Noninterest Income
| · | Fee income represented 30.5% of total revenue |
| · | Service charges on deposit accounts expand year over year to $13.0 million |
Noninterest income during the first quarter totaled $38.4 million. Service charges on deposit accounts totaled $13.0 million, reflecting a seasonal decline from the prior quarter and an increase from levels one year earlier. Insurance revenue expanded $446 thousand from the prior quarter to $6.8 million. Mortgage banking income during the quarter was $6.1 million, reflecting solid mortgage servicing income, stable secondary marketing gains, and successful hedging initiatives. General banking and wealth management income remained stable during the quarter at $5.9 million and $5.4 million, respectively.
Noninterest Expense
| · | Noninterest expense remained well-controlled |
| · | Foreclosure expense declined to $3.0 million |
During the first quarter of 2010, noninterest expense totaled $76.4 million, an increase of $714 thousand from the prior quarter. Salary and benefit expense totaled $42.9 million, reflecting a seasonal increase of $645 thousand from the prior quarter. Other expense in the first quarter totaled $13.9 million, a decline of $457 thousand from the prior quarter as increased FDIC insurance expense was more than offset by lower foreclosure expense. Trustmark’s commitment to expense management was reflected in an efficiency ratio of 59.33% during the first quarter.
ADDITIONAL INFORMATION
As previously announced, Trustmark will conduct a conference call with analysts on Wednesday, April 28, 2010, at 10:00 a.m. Central Time to discuss the Corporation’s financial results. Interested parties may listen to the conference call by dialing (800) 860-2442, passcode 436565, 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, May 5, 2010, in archived format at the same web address or by calling (877) 344-7529, passcode 436565.
Trustmark is a financial services company providing banking and financial solutions through over 150 offices in 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 no t 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 the extent and duration of the current volatility in the credit and financial markets, 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 pri cing, as well as the entry of new competitors into our markets through de novo expansion and acquisitions, economic conditions and monetary and other governmental actions designed to address the level and volatility of interest rates and the volatility of securities, currency and other 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, changes in our compensation and benefit plans, greater than expected costs or difficulties related to the integration of new products and lines of business, natural 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 Investor Contacts:
Louis E. Greer
Treasurer and
Principal Financial Officer
601-208-2310
F. Joseph Rein, Jr.
Senior Vice President
601-208-6898
Trustmark Media Contact:
Melanie A. Morgan
Senior Vice President
601-208-2979
 | TRUSTMARK CORPORATION AND SUBSIDIARIES CONSOLIDATED FINANCIAL INFORMATION |
| | | | | | | | | | | | Linked Quarter | | | Year over Year | |
| QUARTERLY AVERAGE BALANCES | | 3/31/2010 | | | 12/31/2009 | | | 3/31/2009 | | | $ Change | | | % Change | | | $ Change | | | % Change | |
| Securities AFS-taxable | | $ | 1,514,029 | | | $ | 1,369,022 | | | $ | 1,505,328 | | | $ | 145,007 | | | | 10.6 | % | | $ | 8,701 | | | | 0.6 | % |
| Securities AFS-nontaxable | | | 105,067 | | | | 98,456 | | | | 43,429 | | | | 6,611 | | | | 6.7 | % | | | 61,638 | | | | n/m | |
| Securities HTM-taxable | | | 179,076 | | | | 202,235 | | | | 178,417 | | | | (23,159 | ) | | | -11.5 | % | | | 659 | | | | 0.4 | % |
| Securities HTM-nontaxable | | | 46,852 | | | | 50,411 | | | | 67,308 | | | | (3,559 | ) | | | -7.1 | % | | | (20,456 | ) | | | -30.4 | % |
| Total securities | | | 1,845,024 | | | | 1,720,124 | | | | 1,794,482 | | | | 124,900 | | | | 7.3 | % | | | 50,542 | | | | 2.8 | % |
| Loans (including loans held for sale) | | | 6,412,671 | | | | 6,544,448 | | | | 6,981,921 | | | | (131,777 | ) | | | -2.0 | % | | | (569,250 | ) | | | -8.2 | % |
| Fed funds sold and rev repos | | | 10,438 | | | | 10,609 | | | | 15,988 | | | | (171 | ) | | | -1.6 | % | | | (5,550 | ) | | | -34.7 | % |
| Other earning assets | | | 46,199 | | | | 44,197 | | | | 40,485 | | | | 2,002 | | | | 4.5 | % | | | 5,714 | | | | 14.1 | % |
| Total earning assets | | | 8,314,332 | | | | 8,319,378 | | | | 8,832,876 | | | | (5,046 | ) | | | -0.1 | % | | | (518,544 | ) | | | -5.9 | % |
| Allowance for loan losses | | | (106,200 | ) | | | (105,223 | ) | | | (97,986 | ) | | | (977 | ) | | | 0.9 | % | | | (8,214 | ) | | | 8.4 | % |
| Cash and due from banks | | | 216,305 | | | | 199,586 | | | | 239,508 | | | | 16,719 | | | | 8.4 | % | | | (23,203 | ) | | | -9.7 | % |
| Other assets | | | 910,401 | | | | 855,714 | | | | 803,416 | | | | 54,687 | | | | 6.4 | % | | | 106,985 | | | | 13.3 | % |
| Total assets | | $ | 9,334,838 | | | $ | 9,269,455 | | | $ | 9,777,814 | | | $ | 65,383 | | | | 0.7 | % | | $ | (442,976 | ) | | | -4.5 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing demand deposits | | $ | 1,270,827 | | | $ | 1,134,995 | | | $ | 1,118,347 | | | $ | 135,832 | | | | 12.0 | % | | $ | 152,480 | | | | 13.6 | % |
| Savings deposits | | | 1,953,711 | | | | 1,801,870 | | | | 1,815,672 | | | | 151,841 | | | | 8.4 | % | | | 138,039 | | | | 7.6 | % |
| Time deposits less than $100,000 | | | 1,356,469 | | | | 1,422,270 | | | | 1,485,680 | | | | (65,801 | ) | | | -4.6 | % | | | (129,211 | ) | | | -8.7 | % |
| Time deposits of $100,000 or more | | | 1,014,027 | | | | 1,039,565 | | | | 1,074,873 | | | | (25,538 | ) | | | -2.5 | % | | | (60,846 | ) | | | -5.7 | % |
| Total interest-bearing deposits | | | 5,595,034 | | | | 5,398,700 | | | | 5,494,572 | | | | 196,334 | | | | 3.6 | % | | | 100,462 | | | | 1.8 | % |
| Fed funds purchased and repos | | | 600,826 | | | | 579,616 | | | | 674,175 | | | | 21,210 | | | | 3.7 | % | | | (73,349 | ) | | | -10.9 | % |
| Short-term borrowings | | | 199,550 | | | | 238,060 | | | | 647,604 | | | | (38,510 | ) | | | -16.2 | % | | | (448,054 | ) | | | -69.2 | % |
| Long-term FHLB advances | | | 75,000 | | | | 75,000 | | | | 58,333 | | | | - | | | | 0.0 | % | | | 16,667 | | | | 28.6 | % |
| Subordinated notes | | | 49,777 | | | | 49,769 | | | | 49,744 | | | | 8 | | | | 0.0 | % | | | 33 | | | | 0.1 | % |
| Junior subordinated debt securities | | | 70,104 | | | | 70,104 | | | | 70,104 | | | | - | | | | 0.0 | % | | | - | | | | 0.0 | % |
| Total interest-bearing liabilities | | | 6,590,291 | | | | 6,411,249 | | | | 6,994,532 | | | | 179,042 | | | | 2.8 | % | | | (404,241 | ) | | | -5.8 | % |
| Noninterest-bearing deposits | | | 1,535,209 | | | | 1,533,588 | | | | 1,470,822 | | | | 1,621 | | | | 0.1 | % | | | 64,387 | | | | 4.4 | % |
| Other liabilities | | | 85,982 | | | | 118,906 | | | | 120,062 | | | | (32,924 | ) | | | -27.7 | % | | | (34,080 | ) | | | -28.4 | % |
| Total liabilities | | | 8,211,482 | | | | 8,063,743 | | | | 8,585,416 | | | | 147,739 | | | | 1.8 | % | | | (373,934 | ) | | | -4.4 | % |
| Preferred equity | | | - | | | | 157,270 | | | | 205,417 | | | | (157,270 | ) | | | -100.0 | % | | | (205,417 | ) | | | -100.0 | % |
| Common equity | | | 1,123,356 | | | | 1,048,442 | | | | 986,981 | | | | 74,914 | | | | 7.1 | % | | | 136,375 | | | | 13.8 | % |
| Total shareholders' equity | | | 1,123,356 | | | | 1,205,712 | | | | 1,192,398 | | | | (82,356 | ) | | | -6.8 | % | | | (69,042 | ) | | | -5.8 | % |
| Total liabilities and equity | | $ | 9,334,838 | | | $ | 9,269,455 | | | $ | 9,777,814 | | | $ | 65,383 | | | | 0.7 | % | | $ | (442,976 | ) | | | -4.5 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | Linked Quarter | | | Year over Year | |
| PERIOD END BALANCES | | 3/31/2010 | | | 12/31/2009 | | | 3/31/2009 | | | $ Change | | | % Change | | | $ Change | | | % Change | |
| Cash and due from banks | | $ | 191,973 | | | $ | 213,519 | | | $ | 231,211 | | | $ | (21,546 | ) | | | -10.1 | % | | $ | (39,238 | ) | | | -17.0 | % |
| Fed funds sold and rev repos | | | 11,599 | | | | 6,374 | | | | 8,014 | | | | 5,225 | | | | 82.0 | % | | | 3,585 | | | | 44.7 | % |
| Securities available for sale | | | 1,706,565 | | | | 1,684,396 | | | | 1,613,047 | | | | 22,169 | | | | 1.3 | % | | | 93,518 | | | | 5.8 | % |
| Securities held to maturity | | | 215,888 | | | | 232,984 | | | | 256,677 | | | | (17,096 | ) | | | -7.3 | % | | | (40,789 | ) | | | -15.9 | % |
| Loans held for sale | | | 176,682 | | | | 226,225 | | | | 301,691 | | | | (49,543 | ) | | | -21.9 | % | | | (125,009 | ) | | | -41.4 | % |
| Loans | | | 6,170,878 | | | | 6,319,797 | | | | 6,640,597 | | | | (148,919 | ) | | | -2.4 | % | | | (469,719 | ) | | | -7.1 | % |
| Allowance for loan losses | | | (101,643 | ) | | | (103,662 | ) | | | (100,358 | ) | | | 2,019 | | | | -1.9 | % | | | (1,285 | ) | | | 1.3 | % |
| Net Loans | | | 6,069,235 | | | | 6,216,135 | | | | 6,540,239 | | | | (146,900 | ) | | | -2.4 | % | | | (471,004 | ) | | | -7.2 | % |
| Premises and equipment, net | | | 145,113 | | | | 151,161 | | | | 157,068 | | | | (6,048 | ) | | | -4.0 | % | | | (11,955 | ) | | | -7.6 | % |
| Mortgage servicing rights | | | 50,037 | | | | 50,513 | | �� | | 45,256 | | | | (476 | ) | | | -0.9 | % | | | 4,781 | | | | 10.6 | % |
| Goodwill | | | 291,104 | | | | 291,104 | | | | 291,104 | | | | - | | | | 0.0 | % | | | - | | | | 0.0 | % |
| Identifiable intangible assets | | | 18,944 | | | | 19,825 | | | | 22,820 | | | | (881 | ) | | | -4.4 | % | | | (3,876 | ) | | | -17.0 | % |
| Other assets | | | 416,075 | | | | 433,782 | | | | 308,587 | | | | (17,707 | ) | | | -4.1 | % | | | 107,488 | | | | 34.8 | % |
| Total assets | | $ | 9,293,215 | | | $ | 9,526,018 | | | $ | 9,775,714 | | | $ | (232,803 | ) | | | -2.4 | % | | $ | (482,499 | ) | | | -4.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Deposits: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Noninterest-bearing | | $ | 1,511,080 | | | $ | 1,685,187 | | | $ | 1,504,032 | | | $ | (174,107 | ) | | | -10.3 | % | | $ | 7,048 | | | | 0.5 | % |
| Interest-bearing | | | 5,635,973 | | | | 5,503,278 | | | | 5,652,908 | | | | 132,695 | | | | 2.4 | % | | | (16,935 | ) | | | -0.3 | % |
| Total deposits | | | 7,147,053 | | | | 7,188,465 | | | | 7,156,940 | | | | (41,412 | ) | | | -0.6 | % | | | (9,887 | ) | | | -0.1 | % |
| Fed funds purchased and repos | | | 571,711 | | | | 653,032 | | | | 607,083 | | | | (81,321 | ) | | | -12.5 | % | | | (35,372 | ) | | | -5.8 | % |
| Short-term borrowings | | | 132,784 | | | | 253,957 | | | | 448,380 | | | | (121,173 | ) | | | -47.7 | % | | | (315,596 | ) | | | -70.4 | % |
| Long-term FHLB advances | | | 75,000 | | | | 75,000 | | | | 75,000 | | | | - | | | | n/m | | | | - | | | | n/m | |
| Subordinated notes | | | 49,782 | | | | 49,774 | | | | 49,750 | | | | 8 | | | | 0.0 | % | | | 32 | | | | 0.1 | % |
| Junior subordinated debt securities | | | 70,104 | | | | 70,104 | | | | 70,104 | | | | - | | | | 0.0 | % | | | - | | | | 0.0 | % |
| Other liabilities | | | 118,252 | | | | 125,626 | | | | 168,089 | | | | (7,374 | ) | | | -5.9 | % | | | (49,837 | ) | | | -29.6 | % |
| Total liabilities | | | 8,164,686 | | | | 8,415,958 | | | | 8,575,346 | | | | (251,272 | ) | | | -3.0 | % | | | (410,660 | ) | | | -4.8 | % |
| Preferred stock | | | - | | | | - | | | | 205,564 | | | | - | | | | n/m | | | | (205,564 | ) | | | -100.0 | % |
| Common stock | | | 13,302 | | | | 13,267 | | | | 11,955 | | | | 35 | | | | 0.3 | % | | | 1,347 | | | | 11.3 | % |
| Capital surplus | | | 250,365 | | | | 244,864 | | | | 142,167 | | | | 5,501 | | | | 2.2 | % | | | 108,198 | | | | 76.1 | % |
| Retained earnings | | | 860,398 | | | | 853,553 | | | | 845,779 | | | | 6,845 | | | | 0.8 | % | | | 14,619 | | | | 1.7 | % |
| Accum other comprehensive | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| income (loss), net of tax | | | 4,464 | | | | (1,624 | ) | | | (5,097 | ) | | | 6,088 | | | | n/m | | | | 9,561 | | | | n/m | |
| Total shareholders' equity | | | 1,128,529 | | | | 1,110,060 | | | | 1,200,368 | | | | 18,469 | | | | 1.7 | % | | | (71,839 | ) | | | -6.0 | % |
| Total liabilities and equity | | $ | 9,293,215 | | | $ | 9,526,018 | | | $ | 9,775,714 | | | $ | (232,803 | ) | | | -2.4 | % | | $ | (482,499 | ) | | | -4.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| n/m - percentage changes greater than +/- 100% are considered not meaningful | | | | | | | | | | | | | | | | | | | | | | | | | |
| See Notes to Consolidated Financials |
| | TRUSTMARK CORPORATION AND SUBSIDIARIES CONSOLIDATED FINANCIAL INFORMATION |
| | | Quarter Ended | | | Linked Quarter | | | Year over Year | |
| INCOME STATEMENTS | | 3/31/2010 | | | 12/31/2009 | | | 3/31/2009 | | | $ Change | | | % Change | | | $ Change | | | % Change | |
| Interest and fees on loans-FTE | | $ | 84,127 | | | $ | 87,640 | | | $ | 92,382 | | | $ | (3,513 | ) | | | -4.0 | % | | $ | (8,255 | ) | | | -8.9 | % |
| Interest on securities-taxable | | | 19,735 | | | | 19,093 | | | | 21,654 | | | | 642 | | | | 3.4 | % | | | (1,919 | ) | | | -8.9 | % |
| Interest on securities-tax exempt-FTE | | | 2,180 | | | | 2,183 | | | | 1,834 | | | | (3 | ) | | | -0.1 | % | | | 346 | | | | 18.9 | % |
| Interest on fed funds sold and rev repos | | | 8 | | | | 12 | | | | 19 | | | | (4 | ) | | | -33.3 | % | | | (11 | ) | | | -57.9 | % |
| Other interest income | | | 383 | | | | 377 | | | | 313 | | | | 6 | | | | 1.6 | % | | | 70 | | | | 22.4 | % |
| Total interest income-FTE | | | 106,433 | | | | 109,305 | | | | 116,202 | | | | (2,872 | ) | | | -2.6 | % | | | (9,769 | ) | | | -8.4 | % |
| Interest on deposits | | | 13,904 | | | | 16,513 | | | | 22,540 | | | | (2,609 | ) | | | -15.8 | % | | | (8,636 | ) | | | -38.3 | % |
| Interest on fed funds pch and repos | | | 226 | | | | 215 | | | | 364 | | | | 11 | | | | 5.1 | % | | | (138 | ) | | | -37.9 | % |
| Other interest expense | | | 1,592 | | | | 1,716 | | | | 2,352 | | | | (124 | ) | | | -7.2 | % | | | (760 | ) | | | -32.3 | % |
| Total interest expense | | | 15,722 | | | | 18,444 | | | | 25,256 | | | | (2,722 | ) | | | -14.8 | % | | | (9,534 | ) | | | -37.7 | % |
| Net interest income-FTE | | | 90,711 | | | | 90,861 | | | | 90,946 | | | | (150 | ) | | | -0.2 | % | | | (235 | ) | | | -0.3 | % |
| Provision for loan losses | | | 15,095 | | | | 17,709 | | | | 16,866 | | | | (2,614 | ) | | | -14.8 | % | | | (1,771 | ) | | | -10.5 | % |
| Net interest income after provision-FTE | | | 75,616 | | | | 73,152 | | | | 74,080 | | | | 2,464 | | | | 3.4 | % | | | 1,536 | | | | 2.1 | % |
| Service charges on deposit accounts | | | 12,977 | | | | 14,118 | | | | 12,568 | | | | (1,141 | ) | | | -8.1 | % | | | 409 | | | | 3.3 | % |
| Insurance commissions | | | 6,837 | | | | 6,391 | | | | 7,422 | | | | 446 | | | | 7.0 | % | | | (585 | ) | | | -7.9 | % |
| Wealth management | | | 5,355 | | | | 5,438 | | | | 5,555 | | | | (83 | ) | | | -1.5 | % | | | (200 | ) | | | -3.6 | % |
| General banking - other | | | 5,880 | | | | 5,951 | | | | 5,407 | | | | (71 | ) | | | -1.2 | % | | | 473 | | | | 8.7 | % |
| Mortgage banking, net | | | 6,072 | | | | 6,552 | | | | 10,907 | | | | (480 | ) | | | -7.3 | % | | | (4,835 | ) | | | -44.3 | % |
| Other, net | | | 879 | | | | 1,814 | | | | 1,115 | | | | (935 | ) | | | -51.5 | % | | | (236 | ) | | | -21.2 | % |
| Nonint inc-excl sec gains, net | | | 38,000 | | | | 40,264 | | | | 42,974 | | | | (2,264 | ) | | | -5.6 | % | | | (4,974 | ) | | | -11.6 | % |
| Security gains, net | | | 369 | | | | 19 | | | | 30 | | | | 350 | | | | n/m | | | | 339 | | | | n/m | |
| Total noninterest income | | | 38,369 | | | | 40,283 | | | | 43,004 | | | | (1,914 | ) | | | -4.8 | % | | | (4,635 | ) | | | -10.8 | % |
| Salaries and employee benefits | | | 42,854 | | | | 42,209 | | | | 43,425 | | | | 645 | | | | 1.5 | % | | | (571 | ) | | | -1.3 | % |
| Services and fees | | | 10,255 | | | | 9,919 | | | | 10,000 | | | | 336 | | | | 3.4 | % | | | 255 | | | | 2.6 | % |
| Net occupancy-premises | | | 5,034 | | | | 5,063 | | | | 5,178 | | | | (29 | ) | | | -0.6 | % | | | (144 | ) | | | -2.8 | % |
| Equipment expense | | | 4,303 | | | | 4,084 | | | | 4,166 | | | | 219 | | | | 5.4 | % | | | 137 | | | | 3.3 | % |
| Other expense | | | 13,915 | | | | 14,372 | | | | 11,638 | | | | (457 | ) | | | -3.2 | % | | | 2,277 | | | | 19.6 | % |
| Total noninterest expense | | | 76,361 | | | | 75,647 | | | | 74,407 | | | | 714 | | | | 0.9 | % | | | 1,954 | | | | 2.6 | % |
| Income before income taxes and tax eq adj | | | 37,624 | | | | 37,788 | | | | 42,677 | | | | (164 | ) | | | -0.4 | % | | | (5,053 | ) | | | -11.8 | % |
| Tax equivalent adjustment | | | 3,293 | | | | 2,569 | | | | 2,397 | | | | 724 | | | | 28.2 | % | | | 896 | | | | 37.4 | % |
| Income before income taxes | | | 34,331 | | | | 35,219 | | | | 40,280 | | | | (888 | ) | | | -2.5 | % | | | (5,949 | ) | | | -14.8 | % |
| Income taxes | | | 10,876 | | | | 10,742 | | | | 13,795 | | | | 134 | | | | 1.2 | % | | | (2,919 | ) | | | -21.2 | % |
| Net income | | | 23,455 | | | | 24,477 | | | | 26,485 | | | | (1,022 | ) | | | -4.2 | % | | | (3,030 | ) | | | -11.4 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Preferred stock dividends | | | - | | | | 2,061 | | | | 2,688 | | | | (2,061 | ) | | | -100.0 | % | | | (2,688 | ) | | | -100.0 | % |
| Accretion of preferred stock discount | | | - | | | | 8,539 | | | | 438 | | | | (8,539 | ) | | | -100.0 | % | | | (438 | ) | | | -100.0 | % |
| Net income available to common shareholders | | $ | 23,455 | | | $ | 13,877 | | | $ | 23,359 | | | $ | 9,578 | | | | 69.0 | % | | $ | 96 | | | | 0.4 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Per common share data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Earnings per share - basic | | $ | 0.37 | | | $ | 0.23 | | | $ | 0.41 | | | $ | 0.14 | | | | 60.9 | % | | $ | (0.04 | ) | | | -9.8 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Earnings per share - diluted | | $ | 0.37 | | | $ | 0.23 | | | $ | 0.41 | | | $ | 0.14 | | | | 60.9 | % | | $ | (0.04 | ) | | | -9.8 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Dividends per share | | $ | 0.23 | | | $ | 0.23 | | | $ | 0.23 | | | $ | - | | | | 0.0 | % | | $ | - | | | | 0.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Weighted average common shares outstanding | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Basic | | | 63,743,302 | | | | 59,131,451 | | | | 57,350,874 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Diluted | | | 63,933,333 | | | | 59,287,459 | | | | 57,398,375 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Period end common shares outstanding | | | 63,844,500 | | | | 63,673,839 | | | | 57,378,318 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| OTHER FINANCIAL DATA | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Return on common equity | | | 8.47 | % | | | 5.25 | % | | | 9.60 | % | | | | | | | | | | | | | | | | |
| Return on average tangible common equity | | | 11.98 | % | | | 7.80 | % | | | 14.46 | % | | | | | | | | | | | | | | | | |
| Return on equity | | | 8.47 | % | | | 8.05 | % | | | 9.01 | % | | | | | | | | | | | | | | | | |
| Return on assets | | | 1.02 | % | | | 1.05 | % | | | 1.10 | % | | | | | | | | | | | | | | | | |
| Interest margin - Yield - FTE | | | 5.19 | % | | | 5.21 | % | | | 5.34 | % | | | | | | | | | | | | | | | | |
| Interest margin - Cost | | | 0.77 | % | | | 0.88 | % | | | 1.16 | % | | | | | | | | | | | | | | | | |
| Net interest margin - FTE | | | 4.42 | % | | | 4.33 | % | | | 4.18 | % | | | | | | | | | | | | | | | | |
| Efficiency ratio | | | 59.33 | % | | | 57.69 | % | | | 55.56 | % | | | | | | | | | | | | | | | | |
| Full-time equivalent employees | | | 2,506 | | | | 2,524 | | | | 2,589 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| COMMON STOCK PERFORMANCE | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Market value-Close | | $ | 24.43 | | | $ | 22.54 | | | $ | 18.38 | | | | | | | | | | | | | | | | | |
| Common book value | | $ | 17.68 | | | $ | 17.43 | | | $ | 17.34 | | | | | | | | | | | | | | | | | |
| Tangible common book value | | $ | 12.82 | | | $ | 12.55 | | | $ | 11.87 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| n/m - percentage changes greater than +/- 100% are considered not meaningful | | | | | | | | | | | | | | | | | | | | | | | | | |
| See Notes to Consolidated Financials |
| | TRUSTMARK CORPORATION AND SUBSIDIARIES CONSOLIDATED FINANCIAL INFORMATION |
| | | Quarter Ended | | | Linked Quarter | | | Year over Year | |
| NONPERFORMING ASSETS | | 3/31/2010 | | | 12/31/2009 | | | 3/31/2009 | | | $ Change | | | % Change | | | $ Change | | | % Change | |
| Nonaccrual loans | | | | | | | | | | | | | | | | | | | | | |
| Florida | | $ | 79,687 | | | $ | 74,159 | | | $ | 83,789 | | | $ | 5,528 | | | | 7.5 | % | | $ | (4,102 | ) | | | -4.9 | % |
| Mississippi (1) | | | 41,795 | | | | 31,050 | | | | 21,829 | | | | 10,745 | | | | 34.6 | % | | | 19,966 | | | | 91.5 | % |
| Tennessee (2) | | | 12,673 | | | | 12,749 | | | | 5,763 | | | | (76 | ) | | | -0.6 | % | | | 6,910 | | | | n/m | |
| Texas | | | 31,354 | | | | 23,204 | | | | 23,122 | | | | 8,150 | | | | 35.1 | % | | | 8,232 | | | | 35.6 | % |
| Total nonaccrual loans | | | 165,509 | | | | 141,162 | | | | 134,503 | | | | 24,347 | | | | 17.2 | % | | | 31,006 | | | | 23.1 | % |
| Other real estate | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Florida | | | 40,145 | | | | 45,927 | | | | 19,830 | | | | (5,782 | ) | | | -12.6 | % | | | 20,315 | | | | n/m | |
| Mississippi (1) | | | 23,082 | | | | 22,373 | | | | 9,932 | | | | 709 | | | | 3.2 | % | | | 13,150 | | | | n/m | |
| Tennessee (2) | | | 9,769 | | | | 10,105 | | | | 9,051 | | | | (336 | ) | | | -3.3 | % | | | 718 | | | | 7.9 | % |
| Texas | | | 18,180 | | | | 11,690 | | | | 3,322 | | | | 6,490 | | | | 55.5 | % | | | 14,858 | | | | n/m | |
| Total other real estate | | | 91,176 | | | | 90,095 | | | | 42,135 | | | | 1,081 | | | | 1.2 | % | | | 49,041 | | | | n/m | |
| Total nonperforming assets | | $ | 256,685 | | | $ | 231,257 | | | $ | 176,638 | | | $ | 25,428 | | | | 11.0 | % | | $ | 80,047 | | | | 45.3 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| LOANS PAST DUE OVER 90 DAYS | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Loans held for investment | | $ | 8,411 | | | $ | 8,901 | | | $ | 10,004 | | | $ | (490 | ) | | | -5.5 | % | | $ | (1,593 | ) | | | -15.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Loans HFS-Guaranteed GNMA serviced loans | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (no obligation to repurchase) | | $ | 48,571 | | | $ | 46,661 | | | $ | 21,128 | | | $ | 1,910 | | | | 4.1 | % | | $ | 27,443 | | | | n/m | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Quarter Ended | | | Linked Quarter | | | Year over Year | |
| ALLOWANCE FOR LOAN LOSSES | | 3/31/2010 | | | 12/31/2009 | | | 3/31/2009 | | | $ Change | | | % Change | | | $ Change | | | % Change | |
| Beginning Balance | | $ | 103,662 | | | $ | 103,016 | | | $ | 94,922 | | | $ | 646 | | | | 0.6 | % | | $ | 8,740 | | | | 9.2 | % |
| Provision for loan losses | | | 15,095 | | | | 17,709 | | | | 16,866 | | | | (2,614 | ) | | | -14.8 | % | | | (1,771 | ) | | | -10.5 | % |
| Charge-offs | | | (19,775 | ) | | | (20,139 | ) | | | (14,015 | ) | | | 364 | | | | -1.8 | % | | | (5,760 | ) | | | 41.1 | % |
| Recoveries | | | 2,661 | | | | 3,076 | | | | 2,585 | | | | (415 | ) | | | -13.5 | % | | | 76 | | | | 2.9 | % |
| Net charge-offs | | | (17,114 | ) | | | (17,063 | ) | | | (11,430 | ) | | | (51 | ) | | | 0.3 | % | | | (5,684 | ) | | | 49.7 | % |
| Ending Balance | | $ | 101,643 | | | $ | 103,662 | | | $ | 100,358 | | | $ | (2,019 | ) | | | -1.9 | % | | $ | 1,285 | | | | 1.3 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| PROVISION FOR LOAN LOSSES | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Florida | | $ | 5,501 | | | $ | 11,371 | | | $ | 10,733 | | | $ | (5,870 | ) | | | -51.6 | % | | $ | (5,232 | ) | | | -48.7 | % |
| Mississippi (1) | | | 3,748 | | | | 6,310 | | | | 4,386 | | | | (2,562 | ) | | | -40.6 | % | | | (638 | ) | | | -14.5 | % |
| Tennessee (2) | | | 1,314 | | | | 2,097 | | | | 1,621 | | | | (783 | ) | | | -37.3 | % | | | (307 | ) | | | -18.9 | % |
| Texas | | | 4,532 | | | | (2,069 | ) | | | 126 | | | | 6,601 | | | | n/m | | | | 4,406 | | | | n/m | |
| Total provision for loan losses | | $ | 15,095 | | | $ | 17,709 | | | $ | 16,866 | | | $ | (2,614 | ) | | | -14.8 | % | | $ | (1,771 | ) | | | -10.5 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| NET CHARGE-OFFS | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Florida | | $ | 8,989 | | | $ | 8,174 | | | $ | 6,933 | | | $ | 815 | | | | 10.0 | % | | $ | 2,056 | | | | 29.7 | % |
| Mississippi (1) | | | 6,777 | | | | 5,448 | | | | 3,455 | | | | 1,329 | | | | 24.4 | % | | | 3,322 | | | | 96.2 | % |
| Tennessee (2) | | | 426 | | | | 1,169 | | | | 785 | | | | (743 | ) | | | -63.6 | % | | | (359 | ) | | | -45.7 | % |
| Texas | | | 922 | | | | 2,272 | | | | 257 | | | | (1,350 | ) | | | -59.4 | % | | | 665 | | | | n/m | |
| Total net charge-offs | | $ | 17,114 | | | $ | 17,063 | | | $ | 11,430 | | | $ | 51 | | | | 0.3 | % | | $ | 5,684 | | | | 49.7 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| CREDIT QUALITY RATIOS | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net charge offs/average loans | | | 1.08 | % | | | 1.03 | % | | | 0.66 | % | | | | | | | | | | | | | | | | |
| Provision for loan losses/average loans | | | 0.95 | % | | | 1.07 | % | | | 0.98 | % | | | | | | | | | | | | | | | | |
| Nonperforming loans/total loans (incl LHFS) | | | 2.61 | % | | | 2.16 | % | | | 1.94 | % | | | | | | | | | | | | | | | | |
| Nonperforming assets/total loans (incl LHFS) | | | 4.04 | % | | | 3.53 | % | | | 2.54 | % | | | | | | | | | | | | | | | | |
| Nonperforming assets/total loans (incl LHFS) +ORE | | | 3.99 | % | | | 3.48 | % | | | 2.53 | % | | | | | | | | | | | | | | | | |
| ALL/total loans (excl LHFS) | | | 1.65 | % | | | 1.64 | % | | | 1.51 | % | | | | | | | | | | | | | | | | |
| ALL-commercial/total commercial loans | | | 2.10 | % | | | 2.10 | % | | | 1.95 | % | | | | | | | | | | | | | | | | |
| ALL-consumer/total consumer and home mortgage loans | | | 0.80 | % | | | 0.80 | % | | | 0.73 | % | | | | | | | | | | | | | | | | |
| ALL/nonperforming loans | | | 61.41 | % | | | 73.43 | % | | | 74.61 | % | | | | | | | | | | | | | | | | |
| ALL/nonperforming loans (excl impaired loans) | | | 131.36 | % | | | 150.13 | % | | | 137.47 | % | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| CAPITAL RATIOS | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total equity/total assets | | | 12.14 | % | | | 11.65 | % | | | 12.28 | % | | | | | | | | | | | | | | | | |
| Common equity/total assets | | | 12.14 | % | | | 11.65 | % | | | 10.18 | % | | | | | | | | | | | | | | | | |
| Tangible equity/tangible assets | | | 9.11 | % | | | 8.67 | % | | | 9.37 | % | | | | | | | | | | | | | | | | |
| Tangible common equity/tangible assets | | | 9.11 | % | | | 8.67 | % | | | 7.20 | % | | | | | | | | | | | | | | | | |
| Tangible common equity/risk-weighted assets | | | 12.15 | % | | | 11.55 | % | | | 9.43 | % | | | | | | | | | | | | | | | | |
| Tier 1 leverage ratio | | | 9.81 | % | | | 9.74 | % | | | 10.17 | % | | | | | | | | | | | | | | | | |
| Tier 1 common risk-based capital ratio | | | 12.14 | % | | | 11.63 | % | | | 9.55 | % | | | | | | | | | | | | | | | | |
| Tier 1 risk-based capital ratio | | | 13.15 | % | | | 12.61 | % | | | 13.34 | % | | | | | | | | | | | | | | | | |
| Total risk-based capital ratio | | | 15.15 | % | | | 14.58 | % | | | 15.28 | % | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) - Mississippi includes Central and Southern Mississippi Regions | | | | | | | | | | | | | | | | | | | | | | | | | |
| (2) - 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 |
| | | Quarter Ended | |
| AVERAGE BALANCES | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| Securities AFS-taxable | | $ | 1,514,029 | | | $ | 1,369,022 | | | $ | 1,377,318 | | | $ | 1,395,303 | | | $ | 1,505,328 | |
| Securities AFS-nontaxable | | | 105,067 | | | | 98,456 | | | | 89,259 | | | | 70,165 | | | | 43,429 | |
| Securities HTM-taxable | | | 179,076 | | | | 202,235 | | | | 191,934 | | | | 194,079 | | | | 178,417 | |
| Securities HTM-nontaxable | | | 46,852 | | | | 50,411 | | | | 55,440 | | | | 61,166 | | | | 67,308 | |
| Total securities | | | 1,845,024 | | | | 1,720,124 | | | | 1,713,951 | | | | 1,720,713 | | | | 1,794,482 | |
| Loans (including loans held for sale) | | | 6,412,671 | | | | 6,544,448 | | | | 6,693,482 | | | | 6,880,909 | | | | 6,981,921 | |
| Fed funds sold and rev repos | | | 10,438 | | | | 10,609 | | | | 12,821 | | | | 20,973 | | | | 15,988 | |
| Other earning assets | | | 46,199 | | | | 44,197 | | | | 43,894 | | | | 47,084 | | | | 40,485 | |
| Total earning assets | | | 8,314,332 | | | | 8,319,378 | | | | 8,464,148 | | | | 8,669,679 | | | | 8,832,876 | |
| Allowance for loan losses | | | (106,200 | ) | | | (105,223 | ) | | | (102,545 | ) | | | (106,491 | ) | | | (97,986 | ) |
| Cash and due from banks | | | 216,305 | | | | 199,586 | | | | 205,361 | | | | 214,633 | | | | 239,508 | |
| Other assets | | | 910,401 | | | | 855,714 | | | | 871,477 | | | | 824,724 | | | | 803,416 | |
| Total assets | | $ | 9,334,838 | | | $ | 9,269,455 | | | $ | 9,438,441 | | | $ | 9,602,545 | | | $ | 9,777,814 | |
| | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing demand deposits | | $ | 1,270,827 | | | $ | 1,134,995 | | | $ | 1,148,537 | | | $ | 1,131,765 | | | $ | 1,118,347 | |
| Savings deposits | | | 1,953,711 | | | | 1,801,870 | | | | 1,797,421 | | | | 1,869,794 | | | | 1,815,672 | |
| Time deposits less than $100,000 | | | 1,356,469 | | | | 1,422,270 | | | | 1,434,097 | | | | 1,493,172 | | | | 1,485,680 | |
| Time deposits of $100,000 or more | | | 1,014,027 | | | | 1,039,565 | | | | 1,095,431 | | | | 1,096,170 | | | | 1,074,873 | |
| Total interest-bearing deposits | | | 5,595,034 | | | | 5,398,700 | | | | 5,475,486 | | | | 5,590,901 | | | | 5,494,572 | |
| Fed funds purchased and repos | | | 600,826 | | | | 579,616 | | | | 644,012 | | | | 589,542 | | | | 674,175 | |
| Short-term borrowings | | | 199,550 | | | | 238,060 | | | | 263,891 | | | | 340,816 | | | | 647,604 | |
| Long-term FHLB advances | | | 75,000 | | | | 75,000 | | | | 75,000 | | | | 75,000 | | | | 58,333 | |
| Subordinated notes | | | 49,777 | | | | 49,769 | | | | 49,760 | | | | 49,752 | | | | 49,744 | |
| Junior subordinated debt securities | | | 70,104 | | | | 70,104 | | | | 70,104 | | | | 70,104 | | | | 70,104 | |
| Total interest-bearing liabilities | | | 6,590,291 | | | | 6,411,249 | | | | 6,578,253 | | | | 6,716,115 | | | | 6,994,532 | |
| Noninterest-bearing deposits | | | 1,535,209 | | | | 1,533,588 | | | | 1,529,381 | | | | 1,554,642 | | | | 1,470,822 | |
| Other liabilities | | | 85,982 | | | | 118,906 | | | | 113,820 | | | | 124,586 | | | | 120,062 | |
| Total liabilities | | | 8,211,482 | | | | 8,063,743 | | | | 8,221,454 | | | | 8,395,343 | | | | 8,585,416 | |
| Preferred equity | | | - | | | | 157,270 | | | | 206,308 | | | | 205,860 | | | | 205,417 | |
| Common equity | | | 1,123,356 | | | | 1,048,442 | | | | 1,010,679 | | | | 1,001,342 | | | | 986,981 | |
| Total shareholders' equity | | | 1,123,356 | | | | 1,205,712 | | | | 1,216,987 | | | | 1,207,202 | | | | 1,192,398 | |
| Total liabilities and equity | | $ | 9,334,838 | | | $ | 9,269,455 | | | $ | 9,438,441 | | | $ | 9,602,545 | | | $ | 9,777,814 | |
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| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| PERIOD END BALANCES | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| Cash and due from banks | | $ | 191,973 | | | $ | 213,519 | | | $ | 191,449 | | | $ | 220,706 | | | $ | 231,211 | |
| Fed funds sold and rev repos | | | 11,599 | | | | 6,374 | | | | 8,551 | | | | 16,367 | | | | 8,014 | |
| Securities available for sale | | | 1,706,565 | | | | 1,684,396 | | | | 1,528,625 | | | | 1,488,428 | | | | 1,613,047 | |
| Securities held to maturity | | | 215,888 | | | | 232,984 | | | | 242,603 | | | | 254,380 | | | | 256,677 | |
| Loans held for sale | | | 176,682 | | | | 226,225 | | | | 237,152 | | | | 280,975 | | | | 301,691 | |
| Loans | | | 6,170,878 | | | | 6,319,797 | | | | 6,382,440 | | | | 6,570,582 | | | | 6,640,597 | |
| Allowance for loan losses | | | (101,643 | ) | | | (103,662 | ) | | | (103,016 | ) | | | (101,751 | ) | | | (100,358 | ) |
| Net Loans | | | 6,069,235 | | | | 6,216,135 | | | | 6,279,424 | | | | 6,468,831 | | | | 6,540,239 | |
| Premises and equipment, net | | | 145,113 | | | | 151,161 | | | | 151,828 | | | | 156,541 | | | | 157,068 | |
| Mortgage servicing rights | | | 50,037 | | | | 50,513 | | | | 56,042 | | | | 63,316 | | | | 45,256 | |
| Goodwill | | | 291,104 | | | | 291,104 | | | | 291,104 | | | | 291,104 | | | | 291,104 | |
| Identifiable intangible assets | | | 18,944 | | | | 19,825 | | | | 20,819 | | | | 21,820 | | | | 22,820 | |
| Other assets | | | 416,075 | | | | 433,782 | | | | 360,901 | | | | 364,402 | | | | 308,587 | |
| Total assets | | $ | 9,293,215 | | | $ | 9,526,018 | | | $ | 9,368,498 | | | $ | 9,626,870 | | | $ | 9,775,714 | |
| | | | | | | | | | | | | | | | | | | | | |
| Deposits: | | | | | | | | | | | | | | | | | | | | |
| Noninterest-bearing | | $ | 1,511,080 | | | $ | 1,685,187 | | | $ | 1,493,424 | | | $ | 1,558,934 | | | $ | 1,504,032 | |
| Interest-bearing | | | 5,635,973 | | | | 5,503,278 | | | | 5,377,011 | | | | 5,588,955 | | | | 5,652,908 | |
| Total deposits | | | 7,147,053 | | | | 7,188,465 | | | | 6,870,435 | | | | 7,147,889 | | | | 7,156,940 | |
| Fed funds purchased and repos | | | 571,711 | | | | 653,032 | | | | 645,057 | | | | 627,616 | | | | 607,083 | |
| Short-term borrowings | | | 132,784 | | | | 253,957 | | | | 315,105 | | | | 314,751 | | | | 448,380 | |
| Long-term FHLB advances | | | 75,000 | | | | 75,000 | | | | 75,000 | | | | 75,000 | | | | 75,000 | |
| Subordinated notes | | | 49,782 | | | | 49,774 | | | | 49,766 | | | | 49,758 | | | | 49,750 | |
| Junior subordinated debt securities | | | 70,104 | | | | 70,104 | | | | 70,104 | | | | 70,104 | | | | 70,104 | |
| Other liabilities | | | 118,252 | | | | 125,626 | | | | 121,670 | | | | 139,638 | | | | 168,089 | |
| Total liabilities | | | 8,164,686 | | | | 8,415,958 | | | | 8,147,137 | | | | 8,424,756 | | | | 8,575,346 | |
| Preferred stock | | | - | | | | - | | | | 206,461 | | | | 206,009 | | | | 205,564 | |
| Common stock | | | 13,302 | | | | 13,267 | | | | 11,968 | | | | 11,964 | | | | 11,955 | |
| Capital surplus | | | 250,365 | | | | 244,864 | | | | 145,352 | | | | 143,654 | | | | 142,167 | |
| Retained earnings | | | 860,398 | | | | 853,553 | | | | 854,508 | | | | 845,882 | | | | 845,779 | |
| Accum other comprehensive | | | | | | | | | | | | | | | | | | | | |
| income (loss), net of tax | | | 4,464 | | | | (1,624 | ) | | | 3,072 | | | | (5,395 | ) | | | (5,097 | ) |
| Total shareholders' equity | | | 1,128,529 | | | | 1,110,060 | | | | 1,221,361 | | | | 1,202,114 | | | | 1,200,368 | |
| Total liabilities and equity | | $ | 9,293,215 | | | $ | 9,526,018 | | | $ | 9,368,498 | | | $ | 9,626,870 | | | $ | 9,775,714 | |
| | | | | | | | | | | | | | | | | | | | | |
| See Notes to Consolidated Financials |
| | TRUSTMARK CORPORATION AND SUBSIDIARIES CONSOLIDATED FINANCIAL INFORMATION |
| | | Quarter Ended | |
| INCOME STATEMENTS | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| Interest and fees on loans-FTE | | $ | 84,127 | | | $ | 87,640 | | | $ | 89,672 | | | $ | 91,652 | | | $ | 92,382 | |
| Interest on securities-taxable | | | 19,735 | | | | 19,093 | | | | 19,524 | | | | 20,444 | | | | 21,654 | |
| Interest on securities-tax exempt-FTE | | | 2,180 | | | | 2,183 | | | | 2,172 | | | | 2,040 | | | | 1,834 | |
| Interest on fed funds sold and rev repos | | | 8 | | | | 12 | | | | 16 | | | | 19 | | | | 19 | |
| Other interest income | | | 383 | | | | 377 | | | | 381 | | | | 343 | | | | 313 | |
| Total interest income-FTE | | | 106,433 | | | | 109,305 | | | | 111,765 | | | | 114,498 | | | | 116,202 | |
| Interest on deposits | | | 13,904 | | | | 16,513 | | | | 18,403 | | | | 21,430 | | | | 22,540 | |
| Interest on fed funds pch and repos | | | 226 | | | | 215 | | | | 282 | | | | 272 | | | | 364 | |
| Other interest expense | | | 1,592 | | | | 1,716 | | | | 1,786 | | | | 1,980 | | | | 2,352 | |
| Total interest expense | | | 15,722 | | | | 18,444 | | | | 20,471 | | | | 23,682 | | | | 25,256 | |
| Net interest income-FTE | | | 90,711 | | | | 90,861 | | | | 91,294 | | | | 90,816 | | | | 90,946 | |
| Provision for loan losses | | | 15,095 | | | | 17,709 | | | | 15,770 | | | | 26,767 | | | | 16,866 | |
| Net interest income after provision-FTE | | | 75,616 | | | | 73,152 | | | | 75,524 | | | | 64,049 | | | | 74,080 | |
| Service charges on deposit accounts | | | 12,977 | | | | 14,118 | | | | 14,157 | | | | 13,244 | | | | 12,568 | |
| Insurance commissions | | | 6,837 | | | | 6,391 | | | | 7,894 | | | | 7,372 | | | | 7,422 | |
| Wealth management | | | 5,355 | | | | 5,438 | | | | 5,589 | | | | 5,497 | | | | 5,555 | |
| General banking - other | | | 5,880 | | | | 5,951 | | | | 5,620 | | | | 6,063 | | | | 5,407 | |
| Mortgage banking, net | | | 6,072 | | | | 6,552 | | | | 8,871 | | | | 2,543 | | | | 10,907 | |
| Other, net | | | 879 | | | | 1,814 | | | | 994 | | | | 1,693 | | | | 1,115 | |
| Nonint inc-excl sec gains, net | | | 38,000 | | | | 40,264 | | | | 43,125 | | | | 36,412 | | | | 42,974 | |
| Security gains, net | | | 369 | | | | 19 | | | | 1,014 | | | | 4,404 | | | | 30 | |
| Total noninterest income | | | 38,369 | | | | 40,283 | | | | 44,139 | | | | 40,816 | | | | 43,004 | |
| Salaries and employee benefits | | | 42,854 | | | | 42,209 | | | | 42,629 | | | | 40,989 | | | | 43,425 | |
| Services and fees | | | 10,255 | | | | 9,919 | | | | 10,124 | | | | 10,249 | | | | 10,000 | |
| Net occupancy-premises | | | 5,034 | | | | 5,063 | | | | 4,862 | | | | 4,948 | | | | 5,178 | |
| Equipment expense | | | 4,303 | | | | 4,084 | | | | 4,104 | | | | 4,108 | | | | 4,166 | |
| Other expense | | | 13,915 | | | | 14,372 | | | | 17,515 | | | | 18,677 | | | | 11,638 | |
| Total noninterest expense | | | 76,361 | | | | 75,647 | | | | 79,234 | | | | 78,971 | | | | 74,407 | |
| Income before income taxes and tax eq adj | | | 37,624 | | | | 37,788 | | | | 40,429 | | | | 25,894 | | | | 42,677 | |
| Tax equivalent adjustment | | | 3,293 | | | | 2,569 | | | | 2,417 | | | | 2,325 | | | | 2,397 | |
| Income before income taxes | | | 34,331 | | | | 35,219 | | | | 38,012 | | | | 23,569 | | | | 40,280 | |
| Income taxes | | | 10,876 | | | | 10,742 | | | | 12,502 | | | | 6,994 | | | | 13,795 | |
| Net income | | | 23,455 | | | | 24,477 | | | | 25,510 | | | | 16,575 | | | | 26,485 | |
| | | | | | | | | | | | | | | | | | | | | |
| Preferred stock dividends | | | - | | | | 2,061 | | | | 2,688 | | | | 2,687 | | | | 2,688 | |
| Accretion of preferred stock discount | | | - | | | | 8,539 | | | | 452 | | | | 445 | | | | 438 | |
| Net income available to common shareholders | | $ | 23,455 | | | $ | 13,877 | | | $ | 22,370 | | | $ | 13,443 | | | $ | 23,359 | |
| | | | | | | | | | | | | | | | | | | | | |
| Per common share data | | | | | | | | | | | | | | | | | | | | |
| Earnings per share - basic | | $ | 0.37 | | | $ | 0.23 | | | $ | 0.39 | | | $ | 0.23 | | | $ | 0.41 | |
| | | | | | | | | | | | | | | | | | | | | |
| Earnings per share - diluted | | $ | 0.37 | | | $ | 0.23 | | | $ | 0.39 | | | $ | 0.23 | | | $ | 0.41 | |
| | | | | | | | | | | | | | | | | | | | | |
| Dividends per share | | $ | 0.23 | | | $ | 0.23 | | | $ | 0.23 | | | $ | 0.23 | | | $ | 0.23 | |
| | | | | | | | | | | | | | | | | | | | | |
| Weighted average common shares outstanding | | | | | | | | | | | | | | | | | | | | |
| Basic | | | 63,743,302 | | | | 59,131,451 | | | | 57,431,128 | | | | 57,406,499 | | | | 57,350,874 | |
| | | | | | | | | | | | | | | | | | | | | |
| Diluted | | | 63,933,333 | | | | 59,287,459 | | | | 57,559,492 | | | | 57,546,928 | | | | 57,398,375 | |
| | | | | | | | | | | | | | | | | | | | | |
| Period end common shares outstanding | | | 63,844,500 | | | | 63,673,839 | | | | 57,440,047 | | | | 57,423,841 | | | | 57,378,318 | |
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| OTHER FINANCIAL DATA | | | | | | | | | | | | | | | | | | | | |
| Return on common equity | | | 8.47 | % | | | 5.25 | % | | | 8.78 | % | | | 5.38 | % | | | 9.60 | % |
| Return on average tangible common equity | | | 11.98 | % | | | 7.80 | % | | | 13.06 | % | | | 8.20 | % | | | 14.46 | % |
| Return on equity | | | 8.47 | % | | | 8.05 | % | | | 8.32 | % | | | 5.51 | % | | | 9.01 | % |
| Return on assets | | | 1.02 | % | | | 1.05 | % | | | 1.07 | % | | | 0.69 | % | | | 1.10 | % |
| Interest margin - Yield - FTE | | | 5.19 | % | | | 5.21 | % | | | 5.24 | % | | | 5.30 | % | | | 5.34 | % |
| Interest margin - Cost | | | 0.77 | % | | | 0.88 | % | | | 0.96 | % | | | 1.10 | % | | | 1.16 | % |
| Net interest margin - FTE | | | 4.42 | % | | | 4.33 | % | | | 4.28 | % | | | 4.20 | % | | | 4.18 | % |
| Efficiency ratio | | | 59.33 | % | | | 57.69 | % | | | 58.95 | % | | | 58.57 | % | | | 55.56 | % |
| Full-time equivalent employees | | | 2,506 | | | | 2,524 | | | | 2,550 | | | | 2,562 | | | | 2,589 | |
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| COMMON STOCK PERFORMANCE | | | | | | | | | | | | | | | | | | | | |
| Market value-Close | | $ | 24.43 | | | $ | 22.54 | | | $ | 19.05 | | | $ | 19.32 | | | $ | 18.38 | |
| Common book value | | $ | 17.68 | | | $ | 17.43 | | | $ | 17.67 | | | $ | 17.35 | | | $ | 17.34 | |
| Tangible common book value | | $ | 12.82 | | | $ | 12.55 | | | $ | 12.24 | | | $ | 11.90 | | | $ | 11.87 | |
| See Notes to Consolidated Financials |
| | TRUSTMARK CORPORATION AND SUBSIDIARIES CONSOLIDATED FINANCIAL INFORMATION |
| | | Quarter Ended | |
| NONPERFORMING ASSETS | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| Nonaccrual loans | | | | | | | | | | | | | | | |
| Florida | | $ | 79,687 | | | $ | 74,159 | | | $ | 72,063 | | | $ | 72,185 | | | $ | 83,789 | |
| Mississippi (1) | | | 41,795 | | | | 31,050 | | | | 28,470 | | | | 32,040 | | | | 21,829 | |
| Tennessee (2) | | | 12,673 | | | | 12,749 | | | | 11,481 | | | | 2,941 | | | | 5,763 | |
| Texas | | | 31,354 | | | | 23,204 | | | | 26,490 | | | | 25,824 | | | | 23,122 | |
| Total nonaccrual loans | | | 165,509 | | | | 141,162 | | | | 138,504 | | | | 132,990 | | | | 134,503 | |
| Other real estate | | | | | | | | | | | | | | | | | | | | |
| Florida | | | 40,145 | | | | 45,927 | | | | 34,030 | | | | 26,387 | | | | 19,830 | |
| Mississippi (1) | | | 23,082 | | | | 22,373 | | | | 22,932 | | | | 15,542 | | | | 9,932 | |
| Tennessee (2) | | | 9,769 | | | | 10,105 | | | | 9,809 | | | | 10,234 | | | | 9,051 | |
| Texas | | | 18,180 | | | | 11,690 | | | | 4,918 | | | | 3,033 | | | | 3,322 | |
| Total other real estate | | | 91,176 | | | | 90,095 | | | | 71,689 | | | | 55,196 | | | | 42,135 | |
| Total nonperforming assets | | $ | 256,685 | | | $ | 231,257 | | | $ | 210,193 | | | $ | 188,186 | | | $ | 176,638 | |
| | | | | | | | | | | | | | | | | | | | | |
| LOANS PAST DUE OVER 90 DAYS | | | | | | | | | | | | | | | | | | | | |
| Loans held for investment | | $ | 8,411 | | | $ | 8,901 | | | $ | 6,854 | | | $ | 6,873 | | | $ | 10,004 | |
| | | | | | | | | | | | | | | | | | | | | |
| Loans HFS-Guaranteed GNMA serviced loans | | | | | | | | | | | | | | | | | | | | |
| (no obligation to repurchase) | | $ | 48,571 | | | $ | 46,661 | | | $ | 36,686 | | | $ | 28,523 | | | $ | 21,128 | |
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | Quarter Ended | |
| ALLOWANCE FOR LOAN LOSSES | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| Beginning Balance | | $ | 103,662 | | | $ | 103,016 | | | $ | 101,751 | | | $ | 100,358 | | | $ | 94,922 | |
| Provision for loan losses | | | 15,095 | | | | 17,709 | | | | 15,770 | | | | 26,767 | | | | 16,866 | |
| Charge-offs | | | (19,775 | ) | | | (20,139 | ) | | | (18,687 | ) | | | (27,870 | ) | | | (14,015 | ) |
| Recoveries | | | 2,661 | | | | 3,076 | | | | 4,182 | | | | 2,496 | | | | 2,585 | |
| Net charge-offs | | | (17,114 | ) | | | (17,063 | ) | | | (14,505 | ) | | | (25,374 | ) | | | (11,430 | ) |
| Ending Balance | | $ | 101,643 | | | $ | 103,662 | | | $ | 103,016 | | | $ | 101,751 | | | $ | 100,358 | |
| | | | | | | | | | | | | | | | | | | | | |
| PROVISION FOR LOAN LOSSES | | | | | | | | | | | | | | | | | | | | |
| Florida | | $ | 5,501 | | | $ | 11,371 | | | $ | (3,295 | ) | | $ | 28,915 | | | $ | 10,733 | |
| Mississippi (1) | | | 3,748 | | | | 6,310 | | | | 12,009 | | | | (1,044 | ) | | | 4,386 | |
| Tennessee (2) | | | 1,314 | | | | 2,097 | | | | 159 | | | | (659 | ) | | | 1,621 | |
| Texas | | | 4,532 | | | | (2,069 | ) | | | 6,897 | | | | (445 | ) | | | 126 | |
| Total provision for loan losses | | $ | 15,095 | | | $ | 17,709 | | | $ | 15,770 | | | $ | 26,767 | | | $ | 16,866 | |
| | | | | | | | | | | | | | | | | | | | | |
| NET CHARGE-OFFS | | | | | | | | | | | | | | | | | | | | |
| Florida | | $ | 8,989 | | | $ | 8,174 | | | $ | 131 | | | $ | 21,167 | | | $ | 6,933 | |
| Mississippi (1) | | | 6,777 | | | | 5,448 | | | | 9,629 | | | | 3,267 | | | | 3,455 | |
| Tennessee (2) | | | 426 | | | | 1,169 | | | | 872 | | | | 897 | | | | 785 | |
| Texas | | | 922 | | | | 2,272 | | | | 3,873 | | | | 43 | | | | 257 | |
| Total net charge-offs | | $ | 17,114 | | | $ | 17,063 | | | $ | 14,505 | | | $ | 25,374 | | | $ | 11,430 | |
| | | | | | | | | | | | | | | | | | | | | |
| CREDIT QUALITY RATIOS | | | | | | | | | | | | | | | | | | | | |
| Net charge offs/average loans | | | 1.08 | % | | | 1.03 | % | | | 0.86 | % | | | 1.48 | % | | | 0.66 | % |
| Provision for loan losses/average loans | | | 0.95 | % | | | 1.07 | % | | | 0.93 | % | | | 1.56 | % | | | 0.98 | % |
| Nonperforming loans/total loans (incl LHFS) | | | 2.61 | % | | | 2.16 | % | | | 2.09 | % | | | 1.94 | % | | | 1.94 | % |
| Nonperforming assets/total loans (incl LHFS) | | | 4.04 | % | | | 3.53 | % | | | 3.18 | % | | | 2.75 | % | | | 2.54 | % |
| Nonperforming assets/total loans (incl LHFS) +ORE | | | 3.99 | % | | | 3.48 | % | | | 3.14 | % | | | 2.72 | % | | | 2.53 | % |
| ALL/total loans (excl LHFS) | | | 1.65 | % | | | 1.64 | % | | | 1.61 | % | | | 1.55 | % | | | 1.51 | % |
| ALL-commercial/total commercial loans | | | 2.10 | % | | | 2.10 | % | | | 2.08 | % | | | 2.01 | % | | | 1.95 | % |
| ALL-consumer/total consumer and home mortgage loans | | | 0.80 | % | | | 0.80 | % | | | 0.76 | % | | | 0.73 | % | | | 0.73 | % |
| ALL/nonperforming loans | | | 61.41 | % | | | 73.43 | % | | | 74.38 | % | | | 76.51 | % | | | 74.61 | % |
| ALL/nonperforming loans (excl impaired loans) | | | 131.36 | % | | | 150.13 | % | | | 117.93 | % | | | 123.15 | % | | | 137.47 | % |
| | | | | | | | | | | | | | | | | | | | | |
| CAPITAL RATIOS | | | | | | | | | | | | | | | | | | | | |
| Total equity/total assets | | | 12.14 | % | | | 11.65 | % | | | 13.04 | % | | | 12.49 | % | | | 12.28 | % |
| Common equity/total assets | | | 12.14 | % | | | 11.65 | % | | | 10.83 | % | | | 10.35 | % | | | 10.18 | % |
| Tangible equity/tangible assets | | | 9.11 | % | | | 8.67 | % | | | 10.04 | % | | | 9.55 | % | | | 9.37 | % |
| Tangible common equity/tangible assets | | | 9.11 | % | | | 8.67 | % | | | 7.76 | % | | | 7.34 | % | | | 7.20 | % |
| Tangible common equity/risk-weighted assets | | | 12.15 | % | | | 11.55 | % | | | 10.15 | % | | | 9.56 | % | | | 9.43 | % |
| Tier 1 leverage ratio | | | 9.81 | % | | | 9.74 | % | | | 10.70 | % | | | 10.38 | % | | | 10.17 | % |
| Tier 1 common risk-based capital ratio | | | 12.14 | % | | | 11.63 | % | | | 10.15 | % | | | 9.66 | % | | | 9.55 | % |
| Tier 1 risk-based capital ratio | | | 13.15 | % | | | 12.61 | % | | | 14.11 | % | | | 13.50 | % | | | 13.34 | % |
| Total risk-based capital ratio | | | 15.15 | % | | | 14.58 | % | | | 16.09 | % | | | 15.45 | % | | | 15.28 | % |
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| (1) - Mississippi includes Central and Southern Mississippi Regions | | | | | | | | | | | | | | | | | | | | |
| (2) - Tennessee includes Memphis, Tennessee and Northern Mississippi Regions | | | | | | | | | | | | | | | | | |
| See Notes to Consolidated Financials |
| | TRUSTMARK CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL INFORMATION |
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 ($ in thousands):
| | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| SECURITIES AVAILABLE FOR SALE | | | | | | | | | | | | | | | |
| U.S. Treasury securities | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 759 | |
| U.S. Government agency obligations | | | | | | | | | | | | | | | | | | | | |
| Issued by U.S. Government agencies | | | 18 | | | | 20 | | | | 21 | | | | 23 | | | | 25 | |
| Issued by U.S. Government sponsored agencies | | | 68,574 | | | | 47,917 | | | | 24,992 | | | | 25,189 | | | | 25,235 | |
| Obligations of states and political subdivisions | | | 123,292 | | | | 117,508 | | | | 151,427 | | | | 137,799 | | | | 125,366 | |
| Mortgage-backed securities | | | | | | | | | | | | | | | | | | | | |
| Residential mortgage pass-through securities | | | | | | | | | | | | | | | | | | | | |
| Guaranteed by GNMA | | | 11,986 | | | | 12,192 | | | | 9,590 | | | | 10,000 | | | | 10,658 | |
| Issued by FNMA and FHLMC | | | 51,292 | | | | 49,279 | | | | 7,229 | | | | 7,193 | | | | 79,007 | |
| Other residential mortgage-backed securities | | | | | | | | | | | | | | | | | | | | |
| Issued or guaranteed by FNMA, FHLMC, or GNMA | | | 1,387,752 | | | | 1,382,556 | | | | 1,258,779 | | | | 1,209,677 | | | | 1,287,745 | |
| Commercial mortgage-backed securities | | | | | | | | | | | | | | | | | | | | |
| Issued or guaranteed by FNMA, FHLMC, or GNMA | | | 57,485 | | | | 68,735 | | | | 70,359 | | | | 92,395 | | | | 76,183 | |
| Corporate debt securities | | | 6,166 | | | | 6,189 | | | | 6,228 | | | | 6,152 | | | | 8,069 | |
| Total securities available for sale | | $ | 1,706,565 | | | $ | 1,684,396 | | | $ | 1,528,625 | | | $ | 1,488,428 | | | $ | 1,613,047 | |
| | | | | | | | | | | | | | | | | | | | | |
| SECURITIES HELD TO MATURITY | | | | | | | | | | | | | | | | | | | | |
| Obligations of states and political subdivisions | | $ | 69,975 | | | $ | 74,643 | | | $ | 78,522 | | | $ | 89,331 | | | $ | 95,799 | |
| Mortgage-backed securities | | | | | | | | | | | | | | | | | | | | |
| Residential mortgage pass-through securities | | | | | | | | | | | | | | | | | | | | |
| Guaranteed by GNMA | | | 6,801 | | | | 7,044 | | | | 7,269 | | | | 7,298 | | | | 5,325 | |
| Other residential mortgage-backed securities | | | | | | | | | | | | | | | | | | | | |
| Issued or guaranteed by FNMA, FHLMC, or GNMA | | | 136,054 | | | | 148,226 | | | | 153,728 | | | | 154,655 | | | | 155,553 | |
| Commercial mortgage-backed securities | | | | | | | | | | | | | | | | | | | | |
| Issued or guaranteed by FNMA, FHLMC, or GNMA | | | 3,058 | | | | 3,071 | | | | 3,084 | | | | 3,096 | | | | - | |
| Total securities held to maturity | | $ | 215,888 | | | $ | 232,984 | | | $ | 242,603 | | | $ | 254,380 | | | $ | 256,677 | |
Note 2 – Loan Composition
| LOANS BY TYPE | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| Loans secured by real estate: | | | | | | | | | | | | | | | |
| Construction, land development and other land loans | | $ | 803,942 | | | $ | 830,069 | | | $ | 872,367 | | | $ | 960,945 | | | $ | 1,000,020 | |
| Secured by 1-4 family residential properties | | | 1,637,121 | | | | 1,650,743 | | | | 1,637,322 | | | | 1,663,575 | | | | 1,601,600 | |
| Secured by nonfarm, nonresidential properties | | | 1,466,296 | | | | 1,467,307 | | | | 1,472,147 | | | | 1,472,212 | | | | 1,425,937 | |
| Other real estate secured | | | 194,641 | | | | 197,421 | | | | 209,957 | | | | 186,770 | | | | 184,204 | |
| Commercial and industrial loans | | | 1,041,580 | | | | 1,059,164 | | | | 1,101,967 | | | | 1,138,631 | | | | 1,189,928 | |
| Consumer loans | | | 542,488 | | | | 606,315 | | | | 661,075 | | | | 727,399 | | | | 804,958 | |
| Other loans | | | 484,810 | | | | 508,778 | | | | 427,605 | | | | 421,050 | | | | 433,950 | |
| Loans | | | 6,170,878 | | | | 6,319,797 | | | | 6,382,440 | | | | 6,570,582 | | | | 6,640,597 | |
| Allowance for loan losses | | | (101,643 | ) | | | (103,662 | ) | | | (103,016 | ) | | | (101,751 | ) | | | (100,358 | ) |
| Net Loans | | $ | 6,069,235 | | | $ | 6,216,135 | | | $ | 6,279,424 | | | $ | 6,468,831 | | | $ | 6,540,239 | |
The allowance for loan losses is maintained at a level believed adequate by Management, based on estimated probable losses within the existing loan portfolio. Trustmark’s allowance for loan loss methodology is based on guidance provided in SEC Staff Accounting Bulletin No. 102, “Selected Loan Loss Allowance Methodology and Documentation Issues,” as well as on other regulatory guidance. Accordingly, Trustmark’s methodology is based on historical loss experience by type of loan and internal risk ratings, homogeneous risk pools and specific loss allocations, along with adjustments considering environmental factors such as current economic events, industry and geographical conditions and portfolio performance indicators. The provision for loan losses reflects loan quality trends, including the levels of and trends related to nonaccrual loans, past due loans, potential problem loans, criticized loans and net charge-offs or recoveries, among other factors, in complianc e with the Interagency Policy Statement on the Allowance for Loan and Lease Losses published by the governmental regulating agencies for financial services companies.
| | TRUSTMARK CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL INFORMATION |
| Note 2 – Loan Composition (continued) | | | | | | | | | | | | | | | |
| | | March 31, 2010 | |
| LOAN COMPOSITION BY REGION | | Total | | | 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 | | $ | 803,942 | | | $ | 183,670 | | | $ | 299,664 | | | $ | 57,320 | | | $ | 263,288 | |
| Secured by 1-4 family residential properties | | | 1,637,121 | | | | 81,297 | | | | 1,362,648 | | | | 163,410 | | | | 29,766 | |
| Secured by nonfarm, nonresidential properties | | | 1,466,296 | | | | 179,637 | | | | 828,599 | | | | 213,224 | | | | 244,836 | |
| Other real estate secured | | | 194,641 | | | | 5,195 | | | | 161,955 | | | | 9,586 | | | | 17,905 | |
| Commercial and industrial loans | | | 1,041,580 | | | | 22,100 | | | | 767,215 | | | | 68,973 | | | | 183,292 | |
| Consumer loans | | | 542,488 | | | | 2,077 | | | | 504,555 | | | | 27,674 | | | | 8,182 | |
| Other loans | | | 484,810 | | | | 29,480 | | | | 404,848 | | | | 19,637 | | | | 30,845 | |
| Loans | | $ | 6,170,878 | | | $ | 503,456 | | | $ | 4,329,484 | | | $ | 559,824 | | | $ | 778,114 | |
| | | | | | | | | | | | | | | | | | | | | |
| CONSTRUCTION, LAND DEVELOPMENT AND OTHER LAND LOANS BY REGION | | | | | | | | | | | | | |
| Lots | | $ | 91,812 | | | $ | 57,436 | | | $ | 23,634 | | | $ | 3,315 | | | $ | 7,427 | |
| Development | | | 187,378 | | | | 27,381 | | | | 64,546 | | | | 10,851 | | | | 84,600 | |
| Unimproved land | | | 267,386 | | | | 71,271 | | | | 106,402 | | | | 31,136 | | | | 58,577 | |
| 1-4 family construction | | | 121,518 | | | | 10,247 | | | | 76,440 | | | | 5,031 | | | | 29,800 | |
| Other construction | | | 135,848 | | | | 17,335 | | | | 28,642 | | | | 6,987 | | | | 82,884 | |
| Construction, land development and other land loans | | $ | 803,942 | | | $ | 183,670 | | | $ | 299,664 | | | $ | 57,320 | | | $ | 263,288 | |
| | | | | | | | | | | | Classified (3) | |
| FLORIDA CREDIT QUALITY | | Total Loans | | | | Criticized Loans (1) | | | | Special Mention (2) | | | Accruing | | | Nonimpaired Nonaccrual | | | Impaired Nonaccrual (4) | |
| Construction, land development and other land loans: | | | | | | | | | | | | | | | | | | |
| Lots | | $ | 57,436 | | | $ | 23,282 | | | $ | 1,323 | | | $ | 8,630 | | | $ | 9,878 | | | $ | 3,451 | |
| Development | | | 27,381 | | | | 17,026 | | | | - | | | | 3,682 | | | | 1,088 | | | | 12,256 | |
| Unimproved land | | | 71,271 | | | | 46,649 | | | | 19,915 | | | | 12,469 | | | | 1,513 | | | | 12,752 | |
| 1-4 family construction | | | 10,247 | | | | 8,314 | | | | 1,487 | | | | 3,013 | | | | 442 | | | | 3,372 | |
| Other construction | | | 17,335 | | | | 10,336 | | | | - | | | | 1,136 | | | | 6,184 | | | | 3,016 | |
| Construction, land development and other land loans | | | 183,670 | | | | 105,607 | | | | 22,725 | | | | 28,930 | | | | 19,105 | | | | 34,847 | |
| Commercial, commercial real estate and consumer | | | 319,786 | | | | 64,047 | | | | 19,189 | | | | 19,123 | | | | 14,133 | | | | 11,602 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Total Florida loans | | $ | 503,456 | | | $ | 169,654 | | | $ | 41,914 | | | $ | 48,053 | | | $ | 33,238 | | | $ | 46,449 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| FLORIDA CREDIT QUALITY (continued) | | | Total Loans Less Impaired Loans | | | | Loan Loss Reserves | | | Loan Loss Reserve % of NonImpaired Loans | | | | | | | | | |
| Construction, land development and other land loans: | | | | | | | | | | | | | | | | | | | | | | | | |
| Lots | | $ | 53,985 | | | $ | 6,631 | | | | 12.28 | % | | | | | | | | | | | | |
| Development | | | 15,125 | | | | 1,943 | | | | 12.85 | % | | | | | | | | | | | | |
| Unimproved land | | | 58,519 | | | | 7,913 | | | | 13.52 | % | | | | | | | | | | | | |
| 1-4 family construction | | | 6,875 | | | | 1,029 | | | | 14.97 | % | | | | | | | | | | | | |
| Other construction | | | 14,319 | | | | 2,131 | | | | 14.88 | % | | | | | | | | | | | | |
| Construction, land development and other land loans | | | 148,823 | | | | 19,647 | | | | 13.20 | % | | | | | | | | | | | | |
| Commercial, commercial real estate and consumer | | | 308,184 | | | | 5,529 | | | | 1.79 | % | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Total Florida loans | | $ | 457,007 | | | $ | 25,176 | | | | 5.51 | % | | | | | | | | | | | | |
| (1) | Criticized loans equal all special mention and classified loans. |
| (2) | Special mention loans exhibit potential credit weaknesses that, if not resolved, may ultimately result in a more severe classification. |
| (3) | Classified loans include those loans identified by management as exhibiting well-defined credit weaknesses that may jeopardize repayment in full of the debt. |
| (4) | All nonaccrual loans over $1 million are individually assessed for impairment. Impaired loans have been determined to be collateral dependent and assessed using a fair value approach. Fair value estimates begin with appraised values, normally from recently received and reviewed appraisals. Appraised values are adjusted down for costs associated with asset disposal. When a loan is deemed to be impaired, the full difference between book value and the most likely estimate of the asset’s net realizable value is charged off. |
| | TRUSTMARK CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL INFORMATION |
| Note 2 - Loan Composition (continued) | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
| LOAN COMPOSITION -FLORIDA | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| Loans secured by real estate: | | | | | | | | | | | | | | | |
| Construction, land development and other land loans | | $ | 183,670 | | | $ | 198,906 | | | $ | 211,974 | | | $ | 245,494 | | | $ | 276,315 | |
| Secured by 1-4 family residential properties | | | 81,297 | | | | 87,282 | | | | 92,088 | | | | 88,007 | | | | 93,911 | |
| Secured by nonfarm, nonresidential properties | | | 179,637 | | | | 180,267 | | | | 182,548 | | | | 180,559 | | | | 180,649 | |
| Other real estate secured | | | 5,195 | | | | 5,388 | | | | 12,891 | | | | 12,900 | | | | 12,747 | |
| Commercial and industrial loans | | | 22,100 | | | | 19,869 | | | | 19,762 | | | | 19,907 | | | | 18,049 | |
| Consumer loans | | | 2,077 | | | | 2,287 | | | | 2,276 | | | | 2,238 | | | | 2,531 | |
| Other loans | | | 29,480 | | | | 29,655 | | | | 29,880 | | | | 21,692 | | | | 21,823 | |
| Loans | | $ | 503,456 | | | $ | 523,654 | | | $ | 551,419 | | | $ | 570,797 | | | $ | 606,025 | |
| | | | | | | | | | | | | | | | | | | | | |
| CONSTRUCTION, LAND DEVELOPMENT AND OTHER LAND LOANS - FLORIDA | | | | | | | | | | | | | |
| Lots | | $ | 57,436 | | | $ | 61,725 | | | $ | 63,645 | | | $ | 69,005 | | | $ | 74,002 | |
| Development | | | 27,381 | | | | 27,227 | | | | 28,376 | | | | 33,533 | | | | 41,769 | |
| Unimproved land | | | 71,271 | | | | 76,762 | | | | 83,437 | | | | 93,379 | | | �� | 99,063 | |
| 1-4 family construction | | | 10,247 | | | | 10,929 | | | | 13,237 | | | | 17,344 | | | | 25,878 | |
| Other construction | | | 17,335 | | | | 22,263 | | | | 23,279 | | | | 32,233 | | | | 35,603 | |
| Construction, land development and other land loans | | $ | 183,670 | | | $ | 198,906 | | | $ | 211,974 | | | $ | 245,494 | | | $ | 276,315 | |
Note 3 – Stockholders’ Equity
Common Stock Offering
On December 7, 2009, Trustmark completed a public offering of 6,216,216 shares of its common stock, including 810,810 shares issued pursuant to the exercise of the underwriters’ over-allotment option, at a price of $18.50 per share. Trustmark received net proceeds of approximately $109.3 million after deducting underwriting discounts, commissions and estimated offering expenses. Proceeds from this offering were used in the redemption of preferred stock discussed below.
Repurchase of Preferred Stock
On November 21, 2008, Trustmark issued 215,000 shares of Fixed Rate Cumulative Perpetual Preferred Stock, Series A, (Senior Preferred Stock) to the U.S. Treasury (Treasury) in a private placement transaction as part of the Troubled Assets Relief Program Capital Purchase Program (TARP CPP), a voluntary initiative for healthy U.S. financial institutions. As part of its participation in the TARP CPP, Trustmark also issued to the Treasury a ten-year warrant (the Warrant) to purchase up to 1,647,931 shares of Trustmark’s common stock, at an initial exercise price of $19.57 per share, subject to customary anti-dilution adjustments.
On December 9, 2009, Trustmark completed the repurchase of its 215,000 shares of Senior Preferred Stock from the Treasury at a purchase price of $215.0 million plus a final accrued dividend of $716.7 thousand. The repurchase of the Senior Preferred Stock resulted in a one-time, non-cash charge of approximately $8.2 million to net income available to common shareholders in Trustmark’s fourth quarter financial statements for the unaccreted discount recorded at the date of issuance of the Senior Preferred Stock. In addition, on December 30, 2009, Trustmark repurchased in full from the Treasury, the Warrant to purchase 1,647,931 shares of Trustmark’s common stock, which was issued to the Treasury pursuant to the TARP CPP. The purchase price paid by Trustmark to the Treasury for the Warrant was its fair value of $10.0 million.
Note 4 – 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 | |
| | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| Securities – Taxable | | | 4.73 | % | | | 4.82 | % | | | 4.94 | % | | | 5.16 | % | | | 5.22 | % |
| Securities – Nontaxable | | | 5.82 | % | | | 5.82 | % | | | 5.96 | % | | | 6.23 | % | | | 6.72 | % |
| Securities – Total | | | 4.82 | % | | | 4.91 | % | | | 5.02 | % | | | 5.24 | % | | | 5.31 | % |
| Loans | | | 5.32 | % | | | 5.31 | % | | | 5.32 | % | | | 5.34 | % | | | 5.37 | % |
| FF Sold & Rev Repo | | | 0.31 | % | | | 0.45 | % | | | 0.50 | % | | | 0.36 | % | | | 0.48 | % |
| Other Earning Assets | | | 3.36 | % | | | 3.38 | % | | | 3.44 | % | | | 2.92 | % | | | 3.14 | % |
| Total Earning Assets | | | 5.19 | % | | | 5.21 | % | | | 5.24 | % | | | 5.30 | % | | | 5.34 | % |
| | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing Deposits | | | 1.01 | % | | | 1.21 | % | | | 1.33 | % | | | 1.54 | % | | | 1.66 | % |
| FF Pch & Repo | | | 0.15 | % | | | 0.15 | % | | | 0.17 | % | | | 0.19 | % | | | 0.22 | % |
| Borrowings | | | 1.64 | % | | | 1.57 | % | | | 1.54 | % | | | 1.48 | % | | | 1.16 | % |
| Total Interest-bearing Liabilities | | | 0.97 | % | | | 1.14 | % | | | 1.23 | % | | | 1.41 | % | | | 1.46 | % |
| | | | | | | | | | | | | | | | | | | | | |
| Net interest margin | | | 4.42 | % | | | 4.33 | % | | | 4.28 | % | | | 4.20 | % | | | 4.18 | % |
During the first quarter of 2010, the net interest margin increased 24 basis points to 4.42%, from 4.18% for the first quarter of 2009. The increase is due to decreasing deposit costs, offset somewhat by a modest decline in earning asset yields.
| | TRUSTMARK CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL INFORMATION |
Note 5 – Other Noninterest Expense
Other noninterest expense consisted of the following ($ in thousands):
| | | Quarter Ended | |
| | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| FDIC assessment expense | | $ | 3,147 | | | $ | 2,865 | | | $ | 2,913 | | | $ | 7,253 | | | $ | 2,777 | |
| ORE/Foreclosure expense | | | 3,011 | | | | 3,581 | | | | 5,870 | | | | 2,733 | | | | 630 | |
| Other expense | | | 7,757 | | | | 7,926 | | | | 8,732 | | | | 8,691 | | | | 8,231 | |
| Total other expense | | $ | 13,915 | | | $ | 14,372 | | | $ | 17,515 | | | $ | 18,677 | | | $ | 11,638 | |
Note 6 – Mortgage Banking
Trustmark utilizes a portfolio of derivative instruments to achieve a fair value return that offsets the changes in the fair value of mortgage servicing rights (MSR) attributable to interest rates. Changes in the fair value of these derivative instruments are recorded in noninterest income in mortgage banking, net and are offset by the changes in the fair value of MSR. MSR fair values represent the effect of present value decay and the effect of changes in interest rates. Ineffectiveness of hedging MSR fair value is measured by comparing total hedge cost to the change in fair value of the MSR attributable to interest rate changes. The impact of implementing this strategy resulted in a net positive ineffectiveness of $1.0 million and $2.1 million for the quarters ended March 31, 2010 and 2009, respectively. The accompanying table shows that the MSR value decreased $3.1 million for the quarter ended March 31, 2010 primarily due to a decline in mortgage rates. Offsetting the MSR change is a $4.1 million increase in the value of derivative instruments primarily from hedge income resulting from a steep yield curve and option premium.
The following table illustrates the components of mortgage banking revenues included in noninterest income in the accompanying income statements:
| | | Quarter Ended | |
| | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| Mortgage servicing income, net | | $ | 3,449 | | | $ | 3,763 | | | $ | 4,092 | | | $ | 4,029 | | | $ | 4,001 | |
| Change in fair value-MSR from runoff | | | (1,170 | ) | | | (1,219 | ) | | | (1,608 | ) | | | (3,097 | ) | | | (2,643 | ) |
| Gain on sales of loans, net | | | 3,755 | | | | 3,738 | | | | 4,081 | | | | 8,932 | | | | 4,004 | |
| Other, net | | | (1,002 | ) | | | (139 | ) | | | 179 | | | | (2,708 | ) | | | 3,490 | |
| Mortgage banking income before hedge ineffectiveness | | | 5,032 | | | | 6,143 | | | | 6,744 | | | | 7,156 | | | | 8,852 | |
| Change in fair value-MSR from market changes | | | (3,067 | ) | | | 2,710 | | | | (9,344 | ) | | | 13,593 | | | | (352 | ) |
| Change in fair value of derivatives | | | 4,107 | | | | (2,301 | ) | | | 11,471 | | | | (18,206 | ) | | | 2,407 | |
| Net positive (negative) hedge ineffectiveness | | | 1,040 | | | | 409 | | | | 2,127 | | | | (4,613 | ) | | | 2,055 | |
| Mortgage banking, net | | $ | 6,072 | | | $ | 6,552 | | | $ | 8,871 | | | $ | 2,543 | | | $ | 10,907 | |
Note 7 – Non-GAAP Financial Measures
In addition to capital ratios defined by generally accepted accounting principles (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 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.
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 consolidated financial statements in their entirety and not to rely on any single financial measure. The following table reconciles Trustmark’s calculation of these measures to amounts reported und er GAAP.
| | TRUSTMARK CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL INFORMATION |
| Note 7 - Non-GAAP Financial Measures (continued) | | | | | | | | | | | | | | | |
| | | | | Quarter Ended | |
| | | | | 3/31/2010 | | | 12/31/2009 | | | 9/30/2009 | | | 6/30/2009 | | | 3/31/2009 | |
| TANGIBLE COMMON EQUITY | | | | | | | | | | | | | | | | |
| AVERAGE BALANCES | | | | | | | | | | | | | | | | |
| Total shareholders' equity | | | $ | 1,123,356 | | | $ | 1,205,712 | | | $ | 1,216,987 | | | $ | 1,207,202 | | | $ | 1,192,398 | |
| Less: | Preferred stock | | | | - | | | | (157,270 | ) | | | (206,308 | ) | | | (205,860 | ) | | | (205,417 | ) |
| Total average common equity | | | | 1,123,356 | | | | 1,048,442 | | | | 1,010,679 | | | | 1,001,342 | | | | 986,981 | |
| Less: | Goodwill | | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) |
| | Identifiable intangible assets | | | | (19,484 | ) | | | (20,426 | ) | | | (21,430 | ) | | | (22,424 | ) | | | (23,440 | ) |
| Total average tangible common equity | | | $ | 812,768 | | | $ | 736,912 | | | $ | 698,145 | | | $ | 687,814 | | | $ | 672,437 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| PERIOD END BALANCES | | | | | | | | | | | | | | | | | | | | | |
| Total shareholders' equity | | | $ | 1,128,529 | | | $ | 1,110,060 | | | $ | 1,221,361 | | | $ | 1,202,114 | | | $ | 1,200,368 | |
| Less: | Preferred stock | | | | - | | | | - | | | | (206,461 | ) | | | (206,009 | ) | | | (205,564 | ) |
| Total common equity | | | | 1,128,529 | | | | 1,110,060 | | | | 1,014,900 | | | | 996,105 | | | | 994,804 | |
| Less: | Goodwill | | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) |
| | Identifiable intangible assets | | | | (18,944 | ) | | | (19,825 | ) | | | (20,819 | ) | | | (21,820 | ) | | | (22,820 | ) |
| Total tangible common equity | (a) | | $ | 818,481 | | | $ | 799,131 | | | $ | 702,977 | | | $ | 683,181 | | | $ | 680,880 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| TANGIBLE ASSETS | | | | | | | | | | | | | | | | | | | | | |
| Total assets | | | $ | 9,293,215 | | | $ | 9,526,018 | | | $ | 9,368,498 | | | $ | 9,626,870 | | | $ | 9,775,714 | |
| Less: | Goodwill | | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) |
| | Identifiable intangible assets | | | | (18,944 | ) | | | (19,825 | ) | | | (20,819 | ) | | | (21,820 | ) | | | (22,820 | ) |
| Total tangible assets | (b) | | $ | 8,983,167 | | | $ | 9,215,089 | | | $ | 9,056,575 | | | $ | 9,313,946 | | | $ | 9,461,790 | |
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| Risk-weighted assets | (c) | | $ | 6,737,084 | | | $ | 6,918,802 | | | $ | 6,923,907 | | | $ | 7,144,278 | | | $ | 7,216,846 | |
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| NET INCOME ADJUSTED FOR INTANGIBLE AMORTIZATION | | | | | | | | | | | | | | | | | | | | |
| Net income available to common shareholders | | | $ | 23,455 | | | $ | 13,877 | | | $ | 22,370 | | | $ | 13,443 | | | $ | 23,359 | |
| Plus: | Intangible amortization net of tax | | | | 545 | | | | 614 | | | | 619 | | | | 618 | | | | 618 | |
| Net income adjusted for intangible amortization | | | $ | 24,000 | | | $ | 14,491 | | | $ | 22,989 | | | $ | 14,061 | | | $ | 23,977 | |
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| Period end common shares outstanding | (d) | | | 63,844,500 | | | | 63,673,839 | | | | 57,440,047 | | | | 57,423,841 | | | | 57,378,318 | |
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| TANGIBLE COMMON EQUITY MEASUREMENTS | | | | | | | | | | | | | | | | | | | | | |
Return on average tangible common equity 1 | | | | 11.98 | % | | | 7.80 | % | | | 13.06 | % | | | 8.20 | % | | | 14.46 | % |
| Tangible common equity/tangible assets | (a)/(b) | | | 9.11 | % | | | 8.67 | % | | | 7.76 | % | | | 7.34 | % | | | 7.20 | % |
| Tangible common equity/risk-weighted assets | (a)/(c) | | | 12.15 | % | | | 11.55 | % | | | 10.15 | % | | | 9.56 | % | | | 9.43 | % |
| Tangible common book value | (a)/(d)*1,000 | | $ | 12.82 | | | $ | 12.55 | | | $ | 12.24 | | | $ | 11.90 | | | $ | 11.87 | |
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| TIER 1 COMMON RISK-BASED CAPITAL | | | | | | | | | | | | | | | | | | | | | |
| Total shareholders' equity | | | $ | 1,128,529 | | | $ | 1,110,060 | | | $ | 1,221,361 | | | $ | 1,202,114 | | | $ | 1,200,368 | |
| Eliminate qualifying AOCI | | | | (4,464 | ) | | | 1,624 | | | | (3,072 | ) | | | 5,395 | | | | 5,097 | |
| Qualifying tier 1 capital | | | | 68,000 | | | | 68,000 | | | | 68,000 | | | | 68,000 | | | | 68,000 | |
| Disallowed goodwill | | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) | | | (291,104 | ) |
| Adj to goodwill allowed for deferred taxes | | | | 9,158 | | | | 8,805 | | | | 8,453 | | | | 8,100 | | | | 7,748 | |
| Other disallowed intangibles | | | | (18,944 | ) | | | (19,825 | ) | | | (20,819 | ) | | | (21,820 | ) | | | (22,820 | ) |
| Disallowed servicing intangible | | | | (5,004 | ) | | | (5,051 | ) | | | (5,604 | ) | | | (6,331 | ) | | | (4,526 | ) |
| Total tier 1 capital | | | $ | 886,171 | | | $ | 872,509 | | | $ | 977,215 | | | $ | 964,354 | | | $ | 962,763 | |
| Less: | Qualifying tier 1 capital | | | | (68,000 | ) | | | (68,000 | ) | | | (68,000 | ) | | | (68,000 | ) | | | (68,000 | ) |
| | Preferred stock | | | | - | | | | - | | | | (206,461 | ) | | | (206,009 | ) | | | (205,564 | ) |
| Total tier 1 common capital | (e) | | $ | 818,171 | | | $ | 804,509 | | | $ | 702,754 | | | $ | 690,345 | | | $ | 689,199 | |
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| Tier 1 common risk-based capital ratio | (e)/(c) | | | 12.14 | % | | | 11.63 | % | | | 10.15 | % | | | 9.66 | % | | | 9.55 | % |
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1 Calculation = ((net income adjusted for intangible amortization/number of days in period)*number of days in year)/total average tangible common equity | | | | | | | | | |
