Trustmark Corporation Announces Third Quarter 2013 Financial Results and Declares $0.23 Quarterly Dividend

  Trustmark Corporation Announces Third Quarter 2013 Financial Results and
  Declares $0.23 Quarterly Dividend

Business Wire

JACKSON, Miss. -- October 22, 2013

Trustmark Corporation (NASDAQ:TRMK) announced net income available to common
shareholders of $33.0 million in the third quarter of 2013, which resulted in
diluted earnings per common share of $0.49, an increase of 6.5% from the prior
quarter as well as from levels one year earlier. Trustmark’s performance
during the quarter produced a return on average tangible common equity of
14.92% and a return on average assets of 1.11%. During the first nine months
of 2013, Trustmark’s net income available to common shareholders totaled $89.0
million, or $1.33 per common share. Trustmark’s Board of Directors declared a
quarterly cash dividend of $0.23 per common share payable December 15, 2013,
to shareholders of record on December 1, 2013.

Printer friendly version of earnings release with consolidated financial
statements and notes:
http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50733571&lang=en

Gerard R. Host, President and CEO, stated, “Trustmark posted another quarter
of solid financial results. Total revenue increased to $145.6 million,
reflecting the success of our recent merger with BancTrust as well as
expanding customer relationships in our legacy banking, wealth management and
insurance businesses. We also continued to benefit from improvements in credit
quality. During the quarter, we completed our previously announced purchase of
two branch offices in Oxford, Mississippi, and are pleased to provide our
newest customers with an expanded array of financial services. Thanks to our
dedicated associates, solid profitability and strong capital base, we are
well-positioned to continue providing value for our customers and
shareholders.”

Credit Quality

  *Nonperforming assets declined 1.2% during third quarter
  *Improved credit quality reflected in nominal net charge-offs and negative
    provisioning

Nonperforming loans totaled $73.4 million at September 30, 2013, a decline of
1.3% from the prior quarter, while foreclosed other real estate totaled $116.3
million, a decline of 1.2% from the prior quarter. Collectively, nonperforming
assets totaled $189.7 million at September 30, 2013, a decrease of 1.2% from
the prior quarter.

During the third quarter charge-offs exceeded recoveries, resulting in net
charge-offs of $569 thousand, which represented 0.04% of average loans,
excluding acquired loans. This compares to net recoveries of $771 thousand, or
-0.05% of average loans, in the prior quarter. The provision for loan losses
for loans held for investment was a negative $3.6 million in the third quarter
resulting from the quarterly updated quantitative reserve factors and improved
credit quality.

Allocation of Trustmark’s $68.6 million allowance for loan losses represented
1.39% of commercial loans and 0.73% of consumer and home mortgage loans,
resulting in an allowance to total loans held for investment of 1.20% at
September 30, 2013, which represents a level management considers commensurate
with the inherent risk in the loan portfolio. The allowance for loan losses
represented 162.0% of nonperforming loans, excluding impaired loans.

All of the above credit metrics exclude acquired loans and other real estate
covered by FDIC loss-share agreement.

Balance Sheet Management

  *Loans held for investment increased $119.3 million
  *Net interest income (FTE) totaled $102.1 million, resulting in 3.94% net
    interest margin

Loans held for investment totaled $5.7 billion at September 30, 2013, an
increase of $119.3 million, or 2.1%, from the prior quarter. From a geographic
perspective, loans in Trustmark’s Mississippi, Alabama, Texas and Tennessee
markets expanded $71.8 million, $34.3 million, $13.8 million, and $5.2
million, respectively, while loans in Trustmark’s Florida market declined $5.7
million.

Loan growth was also diversified by loan type. During the third quarter,
Trustmark’s 1-4 family mortgage loan portfolio increased $68.1 million while
construction lending expanded $52.8 million due to growth in Trustmark’s
Mississippi, Texas and Alabama markets. Increased lending to public entities
in Mississippi and Tennessee was reflected in other loan growth of $25.4
million. Consumer lending increased $4.3 million principally due to growth in
Trustmark’s Alabama market. Other real estate secured loans expanded $3.8
million as growth in Trustmark’s Tennessee market was partially offset by
declines in Mississippi. Commercial real estate loans increased $1.4 million
as growth in Alabama and Texas was largely offset by declines in other
Trustmark markets. Commercial and industrial loans declined $36.5 million, as
growth in Alabama was more than offset by declines in Trustmark’s other
markets during the quarter.

During the third quarter of 2013, average earning assets remained stable at
$10.3 billion; average deposits totaled $9.7 billion, down $80.8 million, or
0.8%, from the prior quarter. Average noninterest-bearing deposits increased
1.1% to represent 25.6% of average deposits in the third quarter of 2013.

Net interest income (FTE) in the third quarter totaled $102.1 million, a
decrease of $834 thousand from the prior quarter, and resulted in an eight
basis point contraction of the net interest margin to 3.94%, principally
attributable to lower recoveries on acquired loans. Excluding acquired loans,
the net interest margin in the third quarter totaled 3.52% compared to 3.55%
in the prior quarter.

Capital Strength

  *Total risk-based capital ratio expands to 14.02%
  *Tangible common equity totaled $912.6 million

Trustmark’s solid capital position reflects the consistent profitability of
its diversified financial services businesses as well as prudent balance sheet
management. At September 30, 2013, Trustmark’s tangible common equity to
tangible assets ratio was 8.01% while the total risk-based capital ratio was
14.02%, significantly exceeding the 10.00% benchmark to be classified as
“well-capitalized.” Trustmark’s solid capital base provides the opportunity to
support organic loan growth in an improving economy and enhance long-term
shareholder value.

Noninterest Income

  *Noninterest income totaled $47.1 million, up 7.8% from prior quarter
  *Service charges increased $923 thousand from prior quarter to $13.9
    million

Reflecting the continued success of Trustmark’s diversified financial services
businesses, noninterest income totaled $47.1 million during the third quarter,
an increase of $3.4 million, or 7.8%, from the prior quarter. Service charges
on deposit accounts totaled $13.9 million in the third quarter, an increase of
7.1% from the prior quarter due in part to seasonality. Bank card and other
fees totaled $8.9 million in the third quarter, a decrease of $578 thousand
from the prior quarter resulting principally from a decline in commercial
credit related fee income.

Mortgage loan production in the third quarter totaled $357.8 million, down
15.7% from the prior quarter due principally to the decline in refinancing
activity following an extended low interest rate environment. Despite a
decline in mortgage production levels, the profitability of Trustmark’s
mortgage banking unit increased 1.7% from the prior quarter to $8.4 million.
This level of performance reflected increased mortgage servicing income and
effective mortgage servicing hedging strategies that were offset in part by
reduced secondary marketing gains.

Insurance revenue totaled $8.2 million in the third quarter of 2013, an
increase of 2.7% from the prior quarter due to expanded commercial insurance
sales as well as the continued firming of insurance rates. Wealth management
income totaled $7.5 million in the third quarter, an increase of 8.4% from the
prior quarter, reflecting expanded trust management revenue and brokerage
sales.

Other income in the third quarter increased $2.3 million relative to the prior
quarter; results in the second quarter included a $2.3 million write-off of
the FDIC indemnification asset resulting from the re-estimation of cash flows
and loan payoffs.

Noninterest Expense

  *Operating expense remained well-controlled
  *Continued realignment of branch network to enhance efficiency and revenue
    growth

Noninterest expense totaled $101.5 million in the third quarter, a decline of
$5.7 million from the prior quarter. Excluding non-routine litigation expense
of $4.0 million in the second quarter, noninterest expense declined $1.7
million. Excluding ORE/foreclosure expense and amortization of intangibles,
noninterest expense totaled $95.9 million in the third quarter, relatively
unchanged from the prior quarter.

Salary and employee benefit expense totaled $56.0 million in the third
quarter, an increase of $638 thousand, or 1.2%, from the prior quarter. This
increase resulted in part from additional pension costs related to settlement
charges for retirees electing lump sum distributions. Services and fees
increased $764 thousand relative to the prior quarter due to additional data
processing and communication expense.

Trustmark continued realignment of its branch network to enhance productivity
and efficiency as well as promote additional revenue growth. During the third
quarter, Trustmark announced plans to consolidate six additional banking
centers – two each in Alabama, Mississippi, and Houston, Texas. The closure of
these offices with limited growth opportunities will occur during the fourth
quarter of 2013. As previously announced, eight offices were consolidated
earlier this year, including five overlapping offices in the Florida Panhandle
during the second quarter. Thus far in 2013, Trustmark opened three new
banking offices – one each in Houston, Jackson, and Memphis. In addition,
Trustmark completed the purchase of two branch offices serving the Oxford,
Mississippi market during the third quarter of 2013. Trustmark is committed to
investments to support profitable revenue growth as well as reengineering and
efficiency opportunities to enhance shareholder value.

Additional Information

As previously announced, Trustmark will conduct a conference call with
analysts on Wednesday, October 23, 2013, at 10:00 a.m. Central Time to discuss
the Corporation’s financial results. Interested parties may listen to the
conference call by dialing (877) 317-6789, passcode 10008303, 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, November 6, 2013, in archived format at the same web
address or by calling (877) 344-7529, passcode 10008303.

Trustmark Corporation is a financial services company providing banking and
financial solutions through 214 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 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 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 the European financial crisis on the U.S. economy and the
markets we serve, 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 acquisitions or new
products and lines of business, 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
September 30, 2013
($ in thousands)
(unaudited)

                                                                      Linked Quarter           Year over Year
QUARTERLY AVERAGE       9/30/2013        6/30/2013        9/30/2012       $ Change       %         $ Change        %
BALANCES                                                                                 Change                    Change
Securities              $ 3,279,606      $ 3,259,086      $ 2,409,292     $ 20,520       0.6   %   $ 870,314       36.1  %
AFS-taxable
Securities                172,055          171,974          169,037         81           0.0   %     3,018         1.8   %
AFS-nontaxable
Securities                59,168           59,678           28,333          (510     )   -0.9  %     30,835        n/m
HTM-taxable
Securities               11,024         11,520         18,361        (496     )   -4.3  %    (7,337    )   -40.0 %
HTM-nontaxable
Total securities         3,521,853      3,502,258      2,625,023     19,595      0.6   %    896,830      34.2  %
Loans (including
loans held for            5,784,170        5,735,296        5,886,447       48,874       0.9   %     (102,277  )   -1.7  %
sale)
Acquired loans:
Noncovered loans          888,883          949,367          88,562          (60,484  )   -6.4  %     800,321       n/m
Covered loans             39,561           43,425           65,259          (3,864   )   -8.9  %     (25,698   )   -39.4 %
Fed funds sold and        8,978            6,808            6,583           2,170        31.9  %     2,395         36.4  %
rev repos
Other earning            38,226         34,752         31,758        3,474       10.0  %    6,468        20.4  %
assets
Total earning            10,281,671     10,271,906     8,703,632     9,765       0.1   %    1,578,039    18.1  %
assets
Allowance for loan        (79,696    )     (84,574    )     (86,865   )     4,878        -5.8  %     7,169         -8.3  %
losses
Cash and due from         272,320          284,056          236,566         (11,736  )   -4.1  %     35,754        15.1  %
banks
Other assets             1,284,813      1,311,262      958,030       (26,449  )   -2.0  %    326,783      34.1  %
Total assets            $ 11,759,108    $ 11,782,650    $ 9,811,363    $ (23,542  )   -0.2  %   $ 1,947,745    19.9  %
                                                                                                                   
Interest-bearing        $ 1,842,379      $ 1,811,402      $ 1,534,244     $ 30,977       1.7   %   $ 308,135       20.1  %
demand deposits
Savings deposits          2,995,110        3,060,437        2,348,413       (65,327  )   -2.1  %     646,697       27.5  %
Time deposits less        1,380,954        1,419,381        1,150,620       (38,427  )   -2.7  %     230,334       20.0  %
than $100,000
Time deposits of         993,948        1,029,498      781,926       (35,550  )   -3.5  %    212,022      27.1  %
$100,000 or more
Total
interest-bearing          7,212,391        7,320,718        5,815,203       (108,327 )   -1.5  %     1,397,188     24.0  %
deposits
Fed funds purchased       364,446          312,865          374,885         51,581       16.5  %     (10,439   )   -2.8  %
and repos
Short-term                59,324           51,718           81,773          7,606        14.7  %     (22,449   )   -27.5 %
borrowings
Long-term FHLB            8,620            9,575            -               (955     )   -10.0 %     8,620         n/m
advances
Subordinated notes        49,890           49,882           49,858          8            0.0   %     32            0.1   %
Junior subordinated      61,856         82,460         61,856        (20,604  )   -25.0 %    -            0.0   %
debt securities
Total
interest-bearing          7,756,527        7,827,218        6,383,575       (70,691  )   -0.9  %     1,372,952     21.5  %
liabilities
Noninterest-bearing       2,479,082        2,451,547        2,039,729       27,535       1.1   %     439,353       21.5  %
deposits
Other liabilities        190,143        159,525        114,454       30,618      19.2  %    75,689       66.1  %
Total liabilities         10,425,752       10,438,290       8,537,758       (12,538  )   -0.1  %     1,887,994     22.1  %
Shareholders'            1,333,356      1,344,360      1,273,605     (11,004  )   -0.8  %    59,751       4.7   %
equity
Total liabilities       $ 11,759,108    $ 11,782,650    $ 9,811,363    $ (23,542  )   -0.2  %   $ 1,947,745    19.9  %
and equity
                                                                                                                   
                                                                          Linked Quarter           Year over Year
PERIOD END BALANCES     9/30/2013        6/30/2013        9/30/2012       $ Change       %         $ Change        %
                                                                                         Change                    Change
Cash and due from       $ 335,695        $ 301,532        $ 209,188       $ 34,163       11.3  %   $ 126,507       60.5  %
banks
Fed funds sold and        7,867            7,869            5,295           (2       )   0.0   %     2,572         48.6  %
rev repos
Securities                3,372,101        3,511,683        2,724,446       (139,582 )   -4.0  %     647,655       23.8  %
available for sale
Securities held to        69,980           70,338           45,484          (358     )   -0.5  %     24,496        53.9  %
maturity
Loans held for sale       119,986          202,699          324,897         (82,713  )   -40.8 %     (204,911  )   -63.1 %
(LHFS)
Loans held for            5,696,641        5,577,382        5,527,963       119,259      2.1   %     168,678       3.1   %
investment (LHFI)
Allowance for loan       (68,632    )    (72,825    )    (83,526   )    4,193       -5.8  %    14,894       -17.8 %
losses
Net LHFI                  5,628,009        5,504,557        5,444,437       123,452      2.2   %     183,572       3.4   %
Acquired loans:
Noncovered loans          837,875          922,453          83,110          (84,578  )   -9.2  %     754,765       n/m
Covered loans             37,250           40,820           64,503          (3,570   )   -8.7  %     (27,253   )   -42.3 %
Allowance for loan
losses, acquired         (5,333     )    (2,690     )    (4,343    )    (2,643   )   98.3  %    (990      )   22.8  %
loans
Net acquired loans       869,792        960,583        143,270       (90,791  )   -9.5  %    726,522      n/m
Net LHFI and              6,497,801        6,465,140        5,587,707       32,661       0.5   %     910,094       16.3  %
acquired loans
Premises and              208,837          210,845          155,467         (2,008   )   -1.0  %     53,370        34.3  %
equipment, net
Mortgage servicing        63,150           60,380           44,211          2,770        4.6   %     18,939        42.8  %
rights
Goodwill                  372,463          368,315          291,104         4,148        1.1   %     81,359        27.9  %
Identifiable              44,424           46,889           18,327          (2,465   )   -5.3  %     26,097        n/m
intangible assets
Other real estate,
excluding covered         116,329          117,712          82,475          (1,383   )   -1.2  %     33,854        41.0  %
other real estate
Covered other real        5,092            5,147            5,722           (55      )   -1.1  %     (630      )   -11.0 %
estate
FDIC
indemnification           17,085           17,342           23,979          (257     )   -1.5  %     (6,894    )   -28.8 %
asset
Other assets             574,387        477,421        353,857       96,966      20.3  %    220,530      62.3  %
Total assets            $ 11,805,197    $ 11,863,312    $ 9,872,159    $ (58,115  )   -0.5  %   $ 1,933,038    19.6  %
                                                                                                                   
Deposits:
Noninterest-bearing     $ 2,643,612      $ 2,520,895      $ 2,118,853     $ 122,717      4.9   %   $ 524,759       24.8  %
Interest-bearing         7,143,622      7,296,697      5,685,188     (153,075 )   -2.1  %    1,458,434    25.7  %
Total deposits            9,787,234        9,817,592        7,804,041       (30,358  )   -0.3  %     1,983,193     25.4  %
Fed funds purchased       342,465          374,021          408,711         (31,556  )   -8.4  %     (66,246   )   -16.2 %
and repos
Short-term                60,698           56,645           83,612          4,053        7.2   %     (22,914   )   -27.4 %
borrowings
Long-term FHLB            8,562            8,679            -               (117     )   -1.3  %     8,562         n/m
advances
Subordinated notes        49,896           49,888           49,863          8            0.0   %     33            0.1   %
Junior subordinated       61,856           61,856           61,856          -            0.0   %     -             0.0   %
debt securities
Other liabilities        164,972        167,812        186,061       (2,840   )   -1.7  %    (21,089   )   -11.3 %
Total liabilities        10,475,683     10,536,493     8,594,144     (60,810  )   -0.6  %    1,881,539    21.9  %
Common stock              13,998           13,994           13,496          4            0.0   %     502           3.7   %
Capital surplus           343,759          342,359          284,089         1,400        0.4   %     59,670        21.0  %
Retained earnings         1,023,983        1,006,554        973,182         17,429       1.7   %     50,801        5.2   %
Accum other
comprehensive
(loss) income, net       (52,226    )    (36,088    )    7,248         (16,138  )   44.7  %    (59,474   )   n/m
of tax
Total shareholders'      1,329,514      1,326,819      1,278,015     2,695       0.2   %    51,499       4.0   %
equity
Total liabilities       $ 11,805,197    $ 11,863,312    $ 9,872,159    $ (58,115  )   -0.5  %   $ 1,933,038    19.6  %
and equity
                                                                                                                   
n/m - percentage changes greater than +/- 100% are considered not
meaningful
                                                                                                                   
See Notes to Consolidated Financials

                                                                                                          
                                                                                                               
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2013
($ in thousands except per share data)
(unaudited)
                                                    
                                                                                                               
                       Quarter Ended                                      Linked Quarter          Year over Year
INCOME STATEMENTS      9/30/2013        6/30/2013        9/30/2012        $ Change     % Change   $ Change     % Change
Interest and fees      $ 68,417         $ 67,750         $ 72,554         $ 667        1.0    %   $ (4,137 )   -5.7   %
on LHFS & LHFI-FTE
Interest and fees        19,183           20,987           5,229            (1,804 )   -8.6   %     13,954     n/m
on acquired loans
Interest on              18,654           18,547           15,909           107        0.6    %     2,745      17.3   %
securities-taxable
Interest on
securities-tax           1,960            1,974            2,089            (14    )   -0.7   %     (129   )   -6.2   %
exempt-FTE
Interest on fed
funds sold and rev       8                5                6                3          60.0   %     2          33.3   %
repos
Other interest          372            372            339            -         0.0    %    33        9.7    %
income
Total interest          108,594        109,635        96,126         (1,041 )   -0.9   %    12,468    13.0   %
income-FTE
Interest on              4,970            5,071            5,725            (101   )   -2.0   %     (755   )   -13.2  %
deposits
Interest on fed
funds pch and            106              88               135              18         20.5   %     (29    )   -21.5  %
repos
Other interest          1,389          1,513          1,358          (124   )   -8.2   %    31        2.3    %
expense
Total interest          6,465          6,672          7,218          (207   )   -3.1   %    (753   )   -10.4  %
expense
Net interest             102,129          102,963          88,908           (834   )   -0.8   %     13,221     14.9   %
income-FTE
Provision for loan       (3,624     )     (4,846     )     3,358            1,222      -25.2  %     (6,982 )   n/m
losses, LHFI
Provision for loan
losses, acquired        3,292          (1,552     )    2,105          4,844     n/m         1,187     56.4   %
loans
Net interest
income after            102,461        109,361        83,445         (6,900 )   -6.3   %    19,016    22.8   %
provision-FTE
Service charges on       13,852           12,929           13,135           923        7.1    %     717        5.5    %
deposit accounts
Insurance                8,227            8,014            7,533            213        2.7    %     694        9.2    %
commissions
Wealth management        7,520            6,940            5,612            580        8.4    %     1,908      34.0   %
Bank card and            8,929            9,507            6,924            (578   )   -6.1   %     2,005      29.0   %
other fees
Mortgage banking,        8,440            8,295            11,150           145        1.7    %     (2,710 )   -24.3  %
net
Other, net              165            (2,145     )    512            2,310     n/m         (347   )   -67.8  %
Nonint inc-excl
sec gains                47,133           43,540           44,866           3,593      8.3    %     2,267      5.1    %
(losses), net
Security gains          -              174            (1         )    (174   )   -100.0 %    1         -100.0 %
(losses), net
Total noninterest       47,133         43,714         44,865         3,419     7.8    %    2,268     5.1    %
income
Salaries and             56,043           55,405           47,404           638        1.2    %     8,639      18.2   %
employee benefits
Services and fees        13,580           12,816           11,682           764        6.0    %     1,898      16.2   %
Net                      6,644            6,703            5,352            (59    )   -0.9   %     1,292      24.1   %
occupancy-premises
Equipment expense        6,271            6,193            5,095            78         1.3    %     1,176      23.1   %
FDIC assessment          2,376            2,376            1,826            -          0.0    %     550        30.1   %
expense
ORE/Foreclosure          3,079            5,131            1,702            (2,052 )   -40.0  %     1,377      80.9   %
expense
Other expense           13,531         18,571         10,399         (5,040 )   -27.1  %    3,132     30.1   %
Total noninterest       101,524        107,195        83,460         (5,671 )   -5.3   %    18,064    21.6   %
expense
Income before
income taxes and         48,070           45,880           44,850           2,190      4.8    %     3,220      7.2    %
tax eq adj
Tax equivalent          3,700          3,735          3,629          (35    )   -0.9   %    71        2.0    %
adjustment
Income before            44,370           42,145           41,221           2,225      5.3    %     3,149      7.6    %
income taxes
Income taxes            11,336         11,024         11,317         312       2.8    %    19        0.2    %
Net income
available to           $ 33,034        $ 31,121        $ 29,904        $ 1,913     6.1    %   $ 3,130     10.5   %
common
shareholders
                                                                                                               
                                                                                                               
Per common share
data
Earnings per share     $ 0.49          $ 0.46          $ 0.46          $ 0.03      6.5    %   $ 0.03      6.5    %
- basic
                                                                                                               
Earnings per share     $ 0.49          $ 0.46          $ 0.46          $ 0.03      6.5    %   $ 0.03      6.5    %
- diluted
                                                                                                               
Dividends per          $ 0.23          $ 0.23          $ 0.23          $ -         0.0    %   $ -         0.0    %
share
                                                                                                               
Weighted average
common shares
outstanding
Basic                   67,177,013     67,162,530     64,778,329 
                                                                                                               
Diluted                 67,382,478     67,344,117     64,992,614 
                                                                                                               
Period end common       67,181,694     67,163,195     64,779,937 
shares outstanding
                                                                                                               
OTHER FINANCIAL
DATA
Return on common         9.83       %     9.29       %     9.34       %
equity
Return on average
tangible common          14.92      %     14.09      %     12.61      %
equity
Return on assets         1.11       %     1.06       %     1.21       %
Interest margin -        4.19       %     4.28       %     4.39       %
Yield - FTE
Interest margin -        0.25       %     0.26       %     0.33       %
Cost
Net interest             3.94       %     4.02       %     4.06       %
margin - FTE
Efficiency ratio         68.02      %     70.44      %     62.39      %
(1)
Full-time
equivalent               3,110            3,119            2,632
employees
                                                                                                               
COMMON STOCK
PERFORMANCE
Market value-Close     $ 25.60          $ 24.58          $ 24.34
Common book value      $ 19.79          $ 19.76          $ 19.73
Tangible common        $ 13.58          $ 13.57          $ 14.95
book value
                                                                                                               
                                                                                                               
(1) - Excludes nonrecurring income and expense items such as securities gains or losses, bargain purchase gains and
non-routine acquisition related transaction expenses.
                                                                                                               
n/m - percentage changes greater than +/- 100% are considered not meaningful
                                                                                                               
See Notes to Consolidated Financials

                                                                                               
                                                                                                        
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2013
($ in thousands)
(unaudited)
                         Quarter Ended                             Linked Quarter         Year over Year
NONPERFORMING ASSETS     9/30/2013     6/30/2013     9/30/2012     $ Change     %         $ Change      %
(1)                                                                             Change                  Change
Nonaccrual loans
Alabama                  $ 81          $ 73          $ -           $ 8          11.0  %   $ 81          n/m
Florida                    14,619        15,916        21,456        (1,297 )   -8.1  %     (6,837  )   -31.9 %
Mississippi (2)            43,132        41,761        32,041        1,371      3.3   %     11,091      34.6  %
Tennessee (3)              5,596         4,482         7,388         1,114      24.9  %     (1,792  )   -24.3 %
Texas                     9,953       12,086      19,773      (2,133 )   -17.6 %    (9,820  )   -49.7 %
Total nonaccrual           73,381        74,318        80,658        (937   )   -1.3  %     (7,277  )   -9.0  %
loans
Other real estate
Alabama                    25,308        27,245        -             (1,937 )   -7.1  %     25,308      n/m
Florida                    39,198        35,025        22,340        4,173      11.9  %     16,858      75.5  %
Mississippi (2)            25,439        26,843        27,113        (1,404 )   -5.2  %     (1,674  )   -6.2  %
Tennessee (3)              14,615        15,811        18,545        (1,196 )   -7.6  %     (3,930  )   -21.2 %
Texas                     11,769      12,788      14,477      (1,019 )   -8.0  %    (2,708  )   -18.7 %
Total other real          116,329     117,712     82,475      (1,383 )   -1.2  %    33,854     41.0  %
estate
Total nonperforming      $ 189,710    $ 192,030    $ 163,133    $ (2,320 )   -1.2  %   $ 26,577     16.3  %
assets
                                                                                                        
LOANS PAST DUE OVER
90 DAYS  (4)
LHFI                     $ 2,344      $ 4,194      $ 5,699      $ (1,850 )   -44.1 %   $ (3,355  )   -58.9 %
                                                                                                        
LHFS-Guaranteed GNMA
serviced loans
(no obligation to        $ 18,432     $ 14,003     $ 39,492     $ 4,429     31.6  %   $ (21,060 )   -53.3 %
repurchase)
                                                                                                        
                         Quarter Ended                             Linked Quarter         Year over Year
ALLOWANCE FOR LOAN       9/30/2013     6/30/2013     9/30/2012     $ Change     %         $ Change      %
LOSSES (4)                                                                      Change                  Change
Beginning Balance        $ 72,825      $ 76,900      $ 84,809      $ (4,075 )   -5.3  %   $ (11,984 )   -14.1 %
Provision for loan         (3,624  )     (4,846  )     3,358         1,222      -25.2 %     (6,982  )   n/m
losses
Charge-offs                (3,817  )     (3,031  )     (7,907  )     (786   )   25.9  %     4,090       -51.7 %
Recoveries                3,248       3,802       3,266       (554   )   -14.6 %    (18     )   -0.6  %
Net (charge-offs)         (569    )    771         (4,641  )    (1,340 )   n/m        4,072      -87.7 %
recoveries
Ending Balance           $ 68,632     $ 72,825     $ 83,526     $ (4,193 )   -5.8  %   $ (14,894 )   -17.8 %
                                                                                                        
PROVISION FOR LOAN
LOSSES (4)
Alabama                  $ 550         $ 232         $ -           $ 318        n/m       $ 550         n/m
Florida                    (2,642  )     (3,425  )     7             783        -22.9 %     (2,649  )   n/m
Mississippi (2)            (1,051  )     (520    )     466           (531   )   n/m         (1,517  )   n/m
Tennessee (3)              (150    )     (335    )     687           185        -55.2 %     (837    )   n/m
Texas                     (331    )    (798    )    2,198       467       -58.5 %    (2,529  )   n/m
Total provision for      $ (3,624  )   $ (4,846  )   $ 3,358      $ 1,222     -25.2 %   $ (6,982  )   n/m
loan losses
                                                                                                        
NET CHARGE-OFFS (4)
Alabama                  $ 132         $ 67          $ -           $ 65         97.0  %   $ 132         n/m
Florida                    (138    )     (1,426  )     (488    )     1,288      -90.3 %     350         -71.7 %
Mississippi (2)            375           291           4,726         84         28.9  %     (4,351  )   -92.1 %
Tennessee (3)              (153    )     103           438           (256   )   n/m         (591    )   n/m
Texas                     353         194         (35     )    159       82.0  %    388        n/m
Total net
charge-offs              $ 569        $ (771    )   $ 4,641      $ 1,340     n/m       $ (4,072  )   -87.7 %
(recoveries)
                                                                                                        
CREDIT QUALITY
RATIOS  (1)
Net charge                 0.04    %     -0.05   %     0.31    %
offs/average loans
Provision for loan         -0.25   %     -0.34   %     0.23    %
losses/average loans
Nonperforming
loans/total loans          1.26    %     1.29    %     1.38    %
(incl LHFS)
Nonperforming
assets/total loans         3.26    %     3.32    %     2.79    %
(incl LHFS)
Nonperforming
assets/total loans         3.20    %     3.26    %     2.75    %
(incl LHFS) +ORE
ALL/total loans            1.20    %     1.31    %     1.51    %
(excl LHFS)
ALL-commercial/total       1.39    %     1.48    %     1.79    %
commercial loans
ALL-consumer/total
consumer and home          0.73    %     0.84    %     0.84    %
mortgage loans
ALL/nonperforming          93.53   %     97.99   %     103.56  %
loans
ALL/nonperforming
loans -
(excl impaired             161.96  %     158.75  %     174.09  %
loans)
                                                                                                        
CAPITAL RATIOS
Common equity/total        11.26   %     11.18   %     12.95   %
assets
Tangible common
equity/tangible            8.01    %     7.96    %     10.13   %
assets
Tangible common
equity/risk-weighted       11.66   %     11.57   %     14.49   %
assets
Tier 1 leverage            8.78    %     8.71    %     10.83   %
ratio
Tier 1 common
risk-based capital         11.92   %     11.79   %     14.50   %
ratio
Tier 1 risk-based          12.69   %     12.55   %     15.40   %
capital ratio
Total risk-based           14.02   %     13.89   %     17.25   %
capital ratio
                                                                                                        
(1) - Excludes Acquired Loans and Covered Other Real Estate
(2) - Mississippi includes Central and Southern Mississippi Regions
(3) - Tennessee includes Memphis, Tennessee and Northern Mississippi Regions
(4) - Excludes Acquired Loans
                                                                                                        
n/m - percentage changes greater than +/- 100% are considered not meaningful

See Notes to Consolidated Financials

                                                                                                                       
                                                                                                                            
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2013
($ in thousands)
(unaudited)
                      Quarter Ended                                                                      Nine Months Ended
AVERAGE BALANCES        9/30/2013       6/30/2013       3/31/2013        12/31/2012      9/30/2012       9/30/2013        9/30/2012
Securities              $ 3,279,606      $ 3,259,086      $ 2,836,051      $ 2,466,738     $ 2,409,292     $ 3,126,539      $ 2,359,628
AFS-taxable
Securities                172,055          171,974          167,773          169,906         169,037         170,616          165,743
AFS-nontaxable
Securities                59,168           59,678           48,632           26,510          28,333          55,865           30,571
HTM-taxable
Securities               11,024         11,520         16,648         17,443        18,361        13,043         19,774    
HTM-nontaxable
Total securities         3,521,853      3,502,258      3,069,104      2,680,597     2,625,023     3,366,063      2,575,716 
Loans (including
loans held for            5,784,170        5,735,296        5,741,340        5,834,525       5,886,447       5,753,759        5,946,031
sale)
Acquired loans:
Noncovered loans          888,883          949,367          530,643          82,317          88,562          790,943          68,684
Covered loans             39,561           43,425           49,815           58,272          65,259          44,229           70,344
Fed funds sold and        8,978            6,808            6,618            8,747           6,583           7,477            7,151
rev repos
Other earning            38,226         34,752         34,661         31,168        31,758        35,893         31,838    
assets
Total earning            10,281,671     10,271,906     9,432,181      8,695,626     8,703,632     9,998,364      8,699,764 
assets
Allowance for loan        (79,696    )     (84,574    )     (86,447    )     (88,715   )     (86,865   )     (83,547    )     (90,371   )
losses
Cash and due from         272,320          284,056          270,740          238,976         236,566         275,711          246,958
banks
Other assets             1,284,813      1,311,262      1,183,493      972,748       958,030       1,260,227      941,468   
Total assets            $ 11,759,108    $ 11,782,650    $ 10,799,967    $ 9,818,635    $ 9,811,363    $ 11,450,755    $ 9,797,819 
                                                                                                                            
Interest-bearing        $ 1,842,379      $ 1,811,402      $ 1,703,336      $ 1,545,967     $ 1,534,244     $ 1,786,215      $ 1,541,471
demand deposits
Savings deposits          2,995,110        3,060,437        2,767,747        2,275,569       2,348,413       2,941,931        2,384,908
Time deposits less        1,380,954        1,419,381        1,268,619        1,120,735       1,150,620       1,356,729        1,170,274
than $100,000
Time deposits of         993,948        1,029,498      893,104        760,363       781,926       972,553        806,799   
$100,000 or more
Total
interest-bearing          7,212,391        7,320,718        6,632,806        5,702,634       5,815,203       7,057,428        5,903,452
deposits
Fed funds purchased       364,446          312,865          266,958          388,007         374,885         315,113          364,332
and repos
Short-term                59,324           51,718           66,999           85,313          81,773          59,319           82,280
borrowings
Long-term FHLB            8,620            9,575            4,580            -               -               7,606            -
advances
Subordinated notes        49,890           49,882           49,874           49,866          49,858          49,882           49,850
Junior subordinated      61,856         82,460         77,989         61,856        61,856        74,043         61,856    
debt securities
Total
interest-bearing          7,756,527        7,827,218        7,099,206        6,287,676       6,383,575       7,563,391        6,461,770
liabilities
Noninterest-bearing       2,479,082        2,451,547        2,199,043        2,115,784       2,039,729       2,377,583        1,969,445
deposits
Other liabilities        190,143        159,525        176,210        126,953       114,454       175,344        113,920   
Total liabilities         10,425,752       10,438,290       9,474,459        8,530,413       8,537,758       10,116,318       8,545,135
Shareholders'            1,333,356      1,344,360      1,325,508      1,288,222     1,273,605     1,334,437      1,252,684 
equity
Total liabilities       $ 11,759,108    $ 11,782,650    $ 10,799,967    $ 9,818,635    $ 9,811,363    $ 11,450,755    $ 9,797,819 
and equity
                                                                                                                            
PERIOD END BALANCES     9/30/2013        6/30/2013        3/31/2013        12/31/2012      9/30/2012
Cash and due from       $ 335,695        $ 301,532        $ 242,896        $ 231,489       $ 209,188
banks
Fed funds sold and        7,867            7,869            5,926            7,046           5,295
rev repos
Securities                3,372,101        3,511,683        3,546,083        2,657,745       2,724,446
available for sale
Securities held to        69,980           70,338           73,666           42,188          45,484
maturity
Loans held for sale       119,986          202,699          207,758          257,986         324,897
(LHFS)
Loans held for            5,696,641        5,577,382        5,531,788        5,592,754       5,527,963
investment (LHFI)
Allowance for loan       (68,632    )    (72,825    )    (76,900    )    (78,738   )    (83,526   )
losses
Net LHFI                  5,628,009        5,504,557        5,454,888        5,514,016       5,444,437
Acquired loans:
Noncovered loans          837,875          922,453          1,003,127        81,523          83,110
Covered loans             37,250           40,820           47,589           52,041          64,503
Allowance for loan
losses, acquired         (5,333     )    (2,690     )    (6,458     )    (6,075    )    (4,343    )
loans
Net acquired loans       869,792        960,583        1,044,258      127,489       143,270   
Net LHFI and              6,497,801        6,465,140        6,499,146        5,641,505       5,587,707
acquired loans
Premises and              208,837          210,845          210,789          154,841         155,467
equipment, net
Mortgage servicing        63,150           60,380           51,529           47,341          44,211
rights
Goodwill                  372,463          368,315          366,366          291,104         291,104
Identifiable              44,424           46,889           49,361           17,306          18,327
intangible assets
Other real estate,
excluding covered         116,329          117,712          118,406          78,189          82,475
other real estate
Covered other real        5,092            5,147            5,879            5,741           5,722
estate
FDIC
indemnification           17,085           17,342           20,198           21,774          23,979
asset
Other assets             574,387        477,421        452,512        374,412       353,857   
Total assets            $ 11,805,197    $ 11,863,312    $ 11,850,515    $ 9,828,667    $ 9,872,159 
                                                                                                                            
Deposits:
Noninterest-bearing     $ 2,643,612      $ 2,520,895      $ 2,534,287      $ 2,254,211     $ 2,118,853
Interest-bearing         7,143,622      7,296,697      7,375,144      5,642,306     5,685,188 
Total deposits            9,787,234        9,817,592        9,909,431        7,896,517       7,804,041
Fed funds purchased       342,465          374,021          219,769          288,829         408,711
and repos
Short-term                60,698           56,645           46,325           86,920          83,612
borrowings
Long-term FHLB            8,562            8,679            10,969           -               -
advances
Subordinated notes        49,896           49,888           49,879           49,871          49,863
Junior subordinated       61,856           61,856           94,856           61,856          61,856
debt securities
Other liabilities        164,972        167,812        166,340        157,305       186,061   
Total liabilities        10,475,683     10,536,493     10,497,569     8,541,298     8,594,144 
Common stock              13,998           13,994           13,992           13,506          13,496
Capital surplus           343,759          342,359          342,233          285,905         284,089
Retained earnings         1,023,983        1,006,554        991,012          984,563         973,182
Accum other
comprehensive
(loss) income, net       (52,226    )    (36,088    )    5,709          3,395         7,248     
of tax
Total shareholders'      1,329,514      1,326,819      1,352,946      1,287,369     1,278,015 
equity
Total liabilities       $ 11,805,197    $ 11,863,312    $ 11,850,515    $ 9,828,667    $ 9,872,159 
and equity
                                                                                                                            
See Notes to Consolidated Financials

                                                                                                
TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2013
($ in thousands except per share data)
(unaudited)
                                                                                                         
                                                                                                         
                       Quarter Ended                                                       Nine Months Ended
INCOME STATEMENTS      9/30/2013     6/30/2013     3/31/2013     12/31/2012   9/30/2012    9/30/2013     9/30/2012
Interest and fees      $ 68,417      $ 67,750      $ 67,412      $ 69,989     $ 72,554     $ 203,579     $ 221,284
on LHFS & LHFI-FTE
Interest and fees        19,183        20,987        12,782        4,859        5,229        52,952        13,263
on acquired loans
Interest on              18,654        18,547        16,539        15,305       15,909       53,740        51,645
securities-taxable
Interest on
securities-tax           1,960         1,974         2,018         2,066        2,089        5,952         6,277
exempt-FTE
Interest on fed
funds sold and rev       8             5             4             9            6            17            17
repos
Other interest          372         372         355         337        339        1,099       1,005   
income
Total interest          108,594     109,635     99,110      92,565     96,126     317,339     293,491 
income-FTE
Interest on              4,970         5,071         4,909         5,061        5,725        14,950        19,543
deposits
Interest on fed
funds pch and            106           88            81            140          135          275           448
repos
Other interest          1,389       1,513       1,490       1,346      1,358      4,392       4,131   
expense
Total interest          6,465       6,672       6,480       6,547      7,218      19,617      24,122  
expense
Net interest             102,129       102,963       92,630        86,018       88,908       297,722       269,369
income-FTE
Provision for loan       (3,624  )     (4,846  )     (2,968  )     (535   )     3,358        (11,438 )     7,301
losses, LHFI
Provision for loan
losses, acquired        3,292       (1,552  )    130         1,945      2,105      1,870       3,583   
loans
Net interest
income after            102,461     109,361     95,468      84,608     83,445     307,290     258,485 
provision-FTE
Service charges on       13,852        12,929        11,681        12,391       13,135       38,462        37,960
deposit accounts
Insurance                8,227         8,014         7,242         6,887        7,533        23,483        21,318
commissions
Wealth management        7,520         6,940         6,875         6,181        5,612        21,335        16,875
Bank card and            8,929         9,507         7,945         7,978        6,924        26,381        22,467
other fees
Mortgage banking,        8,440         8,295         11,583        11,331       11,150       28,318        29,629
net
Other, net              165         (2,145  )    (1,191  )    (2,007 )    512        (3,171  )    3,120   
Nonint inc-excl
sec gains                47,133        43,540        44,135        42,761       44,866       134,808       131,369
(losses), net
Security gains          -           174         204         18         (1     )    378         1,041   
(losses), net
Total noninterest       47,133      43,714      44,339      42,779     44,865     135,186     132,410 
income
Salaries and             56,043        55,405        53,592        49,724       47,404       165,040       140,795
employee benefits
Services and fees        13,580        12,816        13,032        12,572       11,682       39,428        34,179
Net                      6,644         6,703         5,955         5,023        5,352        19,302        15,244
occupancy-premises
Equipment expense        6,271         6,193         5,674         5,288        5,095        18,138        15,190
FDIC assessment          2,376         2,376         2,021         1,075        1,826        6,773         5,427
expense
ORE/Foreclosure          3,079         5,131         3,820         3,173        1,702        12,030        7,992
expense
Other expense           13,531      18,571      18,051      10,454     10,399     50,153      38,366  
Total noninterest       101,524     107,195     102,145     87,309     83,460     310,864     257,193 
expense
Income before
income taxes and         48,070        45,880        37,662        40,078       44,850       131,612       133,702
tax eq adj
Tax equivalent                                                                  *Story
adjustment              3,700       3,735       3,655       3,699      too
                                                                                large*

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