Equibles

8-K

TRUSTMARK CORP (TRMK)

8-K 2024-07-23 For: 2024-07-23
View Original
Added on April 04, 2026

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

July 23, 2024

Date of Report (Date of earliest event reported)

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TRUSTMARK CORPORATION

(Exact name of registrant as specified in its charter)

Mississippi 000-03683 64-0471500
(State or other jurisdiction<br><br>of incorporation) (Commission<br><br>File Number) (IRS Employer<br><br>Identification No.)
248 East Capitol Street, Jackson, Mississippi 39201
--- ---
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (601) 208-5111

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered Pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, no par value TRMK Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02. Results of Operations and Financial Condition.

On July 23, 2024, Trustmark Corporation issued a press release announcing its financial results for the period ended June 30, 2024. A copy of this press release and the accompanying financial statements and slide presentation are attached hereto as Exhibits 99.1 and 99.2 to this report and incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number Description of Exhibits
99.1 Press release announcing financial results for the period ended June 30, 2024
99.2 Investor slide presentation for the period ended June 30, 2024
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

TRUSTMARK CORPORATION

BY: /s/ Thomas C. Owens
Thomas C. Owens
Treasurer and Principal Financial Officer
DATE: July 23, 2024

EX-99.1

Exhibit 99.1

News Release

Trustmark Corporation Announces Second Quarter 2024 Financial Results

Completed Significant Actions to Increase Earnings, Enhance Profitability Profile,

Reduce Risk, and Strengthen Capital Flexibility

JACKSON, Miss. – July 23, 2024 – Trustmark Corporation (NASDAQGS:TRMK) announced second quarter financial results which reflect the previously disclosed sale of Fisher Brown Bottrell Insurance, Inc. (FBBI). As such, second quarter financial results consist of both continuing operations and discontinued operations. The discontinued operations include the financial results of FBBI prior to the sale as well as the gain on sale in the second quarter. The discontinued operations results are presented as a single line item below income from continuing operations in the accompanying tables for all periods presented. Financial results from adjusted continuing operations exclude significant non-routine transactions(1). Trustmark reported net income of $73.8 million in the second quarter of 2024, representing diluted earnings per share of $1.20 and net income from adjusted continuing operations(1) of $40.5 million, or $0.66 per diluted share.

The Board of Directors declared a quarterly cash dividend of $0.23 per share payable September 15, 2024, to shareholders of record on September 1, 2024.

Significant Non-Routine Transactions in the Second Quarter

  • Completed sale of FBBI, producing a gain on sale of $228.3 million ($171.2 million, net of taxes)
  • Restructured investment securities portfolio; sold available for sale securities of $1.6 billion with an average yield of 1.36%, which generated a loss of $182.8 million ($137.1 million, net of taxes); purchased $1.4 billion of available for sale securities with an average yield of 4.85%
  • Sold a portfolio of 1-4 family mortgage loans that were three payments delinquent and/or nonaccrual at time of selection totaling $56.2 million (Mortgage Loan Sale) which generated a loss of $13.4 million ($10.1 million, net of taxes); sale drove a $54.1 million reduction in nonperforming loans
  • Exchanged Visa Class B-1 shares for Visa Class B-2 shares and Visa Class C common stock; Visa Class C stock exchange resulted in a gain of $8.1 million ($6.0 million, net of taxes)

Second Quarter Highlights

  • Loans held for investment (HFI) increased $97.5 million, or 0.7%, from the prior quarter to $13.2 billion; excluding the Mortgage Loan Sale, loans HFI increased $152.4 million, or 1.2%, linked-quarter
  • Deposits expanded $124.3 million, or 0.8%, linked-quarter to $15.5 billion
  • Net interest income (FTE) increased $8.1 million, or 6.0%, linked-quarter to $144.3 million, resulting in a net interest margin of 3.38%, up 17 basis points from the prior quarter
  • Noninterest expense totaled $118.3 million, down $1.3 million, or 1.1%, linked-quarter
  • Tangible equity to tangible assets ratio increased 105 basis points to 8.52% at June 30, 2024
  • Tangible book value per share increased $3.20, or 14.5%, to $25.23 at June 30, 2024

Duane A. Dewey, President and CEO, stated, “The second quarter of 2024 was an extremely productive quarter for Trustmark. We closed the previously announced sale of our insurance agency and completed significant balance sheet restructuring to position the company for improved operating performance into the second half of the year and beyond. While completing these non-recurring events, we also performed well in our core banking franchise with continued loan growth, deposit growth, solid fee income and disciplined expense management. The commitment and dedication of our associates across the organization to successfully meet our clients’ financial needs and execute the one-time projects are outstanding, and we believe the company is very well positioned for future opportunities.”

Balance Sheet Management

  • Loans HFI totaled $13.2 billion, up 0.7% from the prior quarter and 4.3% year-over-year
  • Deposits totaled $15.5 billion, up 0.8% from the previous quarter and 3.7% year-over-year
  • Enhanced strong capital position with CET1 ratio of 10.92% and total risk-based capital ratio of 13.29%

Loans HFI totaled $13.2 billion at June 30, 2024, reflecting an increase of $97.5 million, or 0.7%, linked-quarter and $541.5 million, or 4.3%, year-over-year. The linked quarter growth reflected increases in construction, development and other land loans, loans secured by nonfarm, nonresidential properties, and other loans and leases offset in part by declines in commercial and industrial loans, other real estate secured loans, and 1-4 family mortgage loans. Trustmark’s loan portfolio continues to be well-diversified by loan type and geography.

Deposits totaled $15.5 billion at June 30, 2024, up $124.3 million, or 0.8%, from the prior quarter and $549.0 million, or 3.7%, year-over-year. Trustmark continues to maintain a strong liquidity position as loans HFI represented 85.1% of total deposits at June 30, 2024. Noninterest-bearing deposits represented 20.4% of total deposits at June 30, 2024, compared to 19.8% at March 31, 2024. The cost of interest-bearing deposits increased 1 basis point to 2.75% for the second quarter, while the cost of total deposits was 2.18%, unchanged from the prior quarter. The total cost of interest-bearing liabilities was 2.95% for the second quarter, up 3 basis points linked-quarter.

During the second quarter, Trustmark did not repurchase any of its outstanding common shares. As previously announced, Trustmark’s Board of Directors authorized a stock repurchase program effective January 1, 2024, under which $50.0 million of Trustmark’s outstanding shares may be acquired through December 31, 2024. As of June 30, 2024, Trustmark had not repurchased any of its outstanding common shares under this program. At June 30, 2024, Trustmark’s tangible equity to tangible assets ratio was 8.52%, up 105 basis points from the prior quarter, while the total risk-based capital ratio was 13.29%, up 87 basis points from the prior quarter. Tangible book value per share was $25.23 at June 30, 2024, an increase of 14.5% from the prior quarter and 24.7% from the prior year.

Credit Quality

  • Nonaccrual loans declined 55.0% linked-quarter to $44.3 million, driven by the Mortgage Loan Sale
  • Net charge-offs totaled $11.6 million for the second quarter; excluding the Mortgage Loan Sale, net charge-offs totaled $3.0 million and represented 0.09% of average loans
  • Allowance for credit losses (ACL) represented 1.18% of loans HFI and 840.20% of nonaccrual loans HFI, excluding individually analyzed loans, at June 30, 2024

Nonaccrual loans totaled $44.3 million at June 30, 2024, down $54.1 million from the prior quarter and $30.7 million year-over-year. Other real estate totaled $6.6 million, reflecting a decrease of $1.0 million from the prior quarter and an increase of $5.4 million from the prior year. Collectively, nonperforming assets totaled $50.9 million at June 30, 2024, down $55.1 million, or 52.0%, from the prior quarter and $25.3 million, or 33.2%, from the prior year.

The total provision for credit losses for loans HFI was $23.3 million in the second quarter. Excluding the Mortgage Loan Sale, the provision for credit losses for loans HFI was $14.7 million and was primarily attributable to credit migration. The provision for credit losses for off-balance sheet credit exposures was a negative $3.6 million, primarily driven by decreases in unfunded commitments. Collectively, the provision for credit losses, excluding the Mortgage Loan Sale, totaled $11.1 million in the second quarter compared to $7.5 million from the prior quarter and $8.5 million in the second quarter of 2023.

Allocation of Trustmark’s $154.7 million ACL on loans HFI represented 1.05% of commercial loans and 1.59% of consumer and home mortgage loans, resulting in an ACL to total loans HFI of 1.18% at June 30, 2024. Management believes the level of the ACL is commensurate with the credit losses currently expected in the loan portfolio.

Revenue Generation

  • Net interest income (FTE) totaled $144.3 million in the second quarter, up 6.0% linked-quarter
  • GAAP noninterest income was negative $141.3 million in the second quarter while noninterest income from adjusted continuing operations(1) totaled $38.2 million and represented 21.3% of total revenue from adjusted continuing operations(1)
  • GAAP revenue was negative $0.3 million in the second quarter while revenue from adjusted continuing operations(1) totaled $179.3 million, up $7.1 million, or 4.1%, linked-quarter

Revenue from adjusted continuing operations(1) in the second quarter totaled $179.3 million, an increase of $7.1 million, or 4.1%, from the prior quarter and $1.5 million, or 0.9%, from the same quarter in the prior year. The linked-quarter increase primarily reflects higher net interest income and solid growth in bank card and other fees and wealth management revenue.

Net interest income (FTE) in the second quarter totaled $144.3 million, resulting in a net interest margin of 3.38%, up 17 basis points from the prior quarter. The increase in the net interest margin was primarily due to increased yields on the securities portfolio and the loans HFI and held for sale portfolio as well as the costs of interest-bearing deposits remaining relatively flat.

Noninterest income from adjusted continuing operations(1) in the second quarter totaled $38.2 million, a decrease of $1.1 million, or 2.8%, from the prior quarter and an increase of $0.4 million, or 1.1%, year-over-year. Bank card and other fees totaled $9.2 million in the second quarter, up $1.8 million, or 24.2%, linked-quarter and $0.3 million, or 3.5%, year-over-year. The linked-quarter increase reflects expanded customer derivative revenue, interchange revenue, and miscellaneous other revenue. Service charges on deposit accounts totaled $10.9 million in the second quarter, relatively unchanged from the prior quarter and up $0.2 million, or 2.1%, year-over-year. Other, net totaled $7.5 million, up $4.4 million linked-quarter as the $8.1 million gain from Visa C exchange was offset in part by the $4.8 million in noncredit-related loss from the Mortgage Loan Sale. Other, net from adjusted continuing operations(1) totaled $4.2 million, an increase of $1.1 million, or 35.5%, from the prior quarter.

Mortgage loan production in the second quarter totaled $379.5 million, an increase of 38.5% from the prior quarter and a decrease of 12.0% year-over-year. Mortgage banking revenue totaled $4.2 million in the second quarter, a decrease of $4.7 million linked-quarter and $2.4 million year-over-year. The linked-quarter decrease was principally attributable to increased net negative hedge ineffectiveness, which was driven by a higher assumed discount rate on servicing cash flows.

Wealth management revenue in the second quarter totaled $9.7 million, an increase of $0.7 million, or 8.3%, from the prior quarter and $0.8 million, or 9.1%, year-over-year. The linked-quarter growth reflected increased investment services and trust management revenue while the year-over-year increase reflected expanded brokerage revenue.

Noninterest Expense

  • Noninterest expense declined $1.3 million, or 1.1%, linked-quarter
  • Salary and employee benefit expense declined $0.6 million, or 1.0%, linked-quarter

Noninterest expense in the second quarter totaled $118.3 million, a decrease of $1.3 million, or 1.1%, when compared to the prior quarter. Salaries and employee benefits expense decreased $0.6 million, or 1.0%, linked-quarter principally due to reduced compensation expense and the seasonal decline in payroll taxes, which were partially offset by increased commission expense. Other expense declined $0.9 million, or 5.6%, linked-quarter.

(1) Please refer to Consolidated Financial Information, Note 1 – Significant Non-Routine Transactions and Note 7 – Non-GAAP Financial Measures.

Additional Information

As previously announced, Trustmark will conduct a conference call with analysts on Wednesday, July 24, 2024, at 8:30 a.m. Central Time to discuss the Corporation’s financial results. Interested parties may listen to the conference call by dialing (877) 317-3051 or by clicking on the link provided under the Investor Relations section of our website at www.trustmark.com. A replay of the conference call will also be available through Wednesday, August 7, 2024, in archived format at the same web address or by calling (877) 344-7529, passcode 4456612.

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

Forward-Looking Statements

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

Risks that could cause actual results to differ materially from current expectations of Management include, but are not limited to, actions by the Board of Governors of the Federal Reserve System (FRB) that impact the level of market interest rates, local, state, national and international economic and market conditions, conditions in the housing and real estate markets in the regions in which Trustmark operates and the extent and duration of the current volatility in the credit and financial markets, changes in the level of nonperforming assets and charge-offs, an increase in unemployment levels and slowdowns in economic growth, 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 impacts related to or resulting from bank failures and other economic and industry volatility, including potential increased regulatory requirements, the demand for the products and services we offer, potential unexpected adverse outcomes in pending litigation matters, our ability to attract and retain 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, 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, greater than expected costs or difficulties related to the integration of acquisitions or new products and lines of business, cyber-attacks and other breaches which could affect our information system security, natural disasters, environmental disasters, pandemics or other health crises, acts of war or terrorism, and other risks described in our filings with the SEC.

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

Trustmark Investor Contacts: Trustmark Media Contact:
Thomas C. Owens Melanie A. Morgan
Treasurer and Senior Vice President
Principal Financial Officer 601-208-2979
601-208-7853

F. Joseph Rein, Jr.

Senior Vice President

601-208-6898

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2024
($ in thousands)
(unaudited)
Linked Quarter Year over Year
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
QUARTERLY AVERAGE BALANCES 6/30/2024 3/31/2024 6/30/2023 Change % Change Change % Change
Securities AFS-taxable $ 1,866,227 $ 1,927,619 $ 2,140,505 ) -3.2 % ) -12.8 %
Securities AFS-nontaxable — — 4,796 n/m ) -100.0 %
Securities HTM-taxable 1,421,246 1,418,476 1,463,086 0.2 % ) -2.9 %
Securities HTM-nontaxable 112 340 1,718 ) -67.1 % ) -93.5 %
Total securities 3,287,585 3,346,435 3,610,105 ) -1.8 % ) -8.9 %
Loans (includes loans held for sale) 13,309,127 13,169,805 12,732,057 1.1 % 4.5 %
Fed funds sold and reverse repurchases 110 114 3,275 ) -3.5 % ) -96.6 %
Other earning assets 592,625 571,215 903,027 3.7 % ) -34.4 %
Total earning assets 17,189,447 17,087,569 17,248,464 0.6 % ) -0.3 %
Allowance for credit losses (ACL), loans held <br>   for investment (LHFI) (143,245 ) (138,711 ) (121,960 ) ) -3.3 % ) -17.5 %
Other assets 1,740,307 1,730,521 1,648,583 0.6 % 5.6 %
Total assets $ 18,786,509 $ 18,679,379 $ 18,775,087 0.6 % 0.1 %
Interest-bearing demand deposits $ 5,222,369 $ 5,291,779 $ 4,803,737 ) -1.3 % 8.7 %
Savings deposits 3,653,966 3,686,027 4,002,134 ) -0.9 % ) -8.7 %
Time deposits 3,346,046 3,321,601 2,335,752 0.7 % 43.3 %
Total interest-bearing deposits 12,222,381 12,299,407 11,141,623 ) -0.6 % 9.7 %
Fed funds purchased and repurchases 434,760 428,127 389,834 1.5 % 11.5 %
Other borrowings 534,350 463,459 1,330,010 15.3 % ) -59.8 %
Subordinated notes 123,556 123,501 123,337 0.0 % 0.2 %
Junior subordinated debt securities 61,856 61,856 61,856 0.0 % 0.0 %
Total interest-bearing liabilities 13,376,903 13,376,350 13,046,660 0.0 % 2.5 %
Noninterest-bearing deposits 3,183,524 3,120,566 3,595,927 2.0 % ) -11.5 %
Other liabilities 498,593 505,942 552,209 ) -1.5 % ) -9.7 %
Total liabilities 17,059,020 17,002,858 17,194,796 0.3 % ) -0.8 %
Shareholders' equity 1,727,489 1,676,521 1,580,291 3.0 % 9.3 %
Total liabilities and equity $ 18,786,509 $ 18,679,379 $ 18,775,087 0.6 % 0.1 %
n/m - percentage changes greater than +/- 100% are considered not meaningful

All values are in US Dollars.

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2024
($ in thousands)
(unaudited)
Linked Quarter Year over Year
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
PERIOD END BALANCES 6/30/2024 3/31/2024 6/30/2023 Change % Change Change % Change
Cash and due from banks $ 822,141 $ 606,061 $ 831,852 35.7 % ) -1.2 %
Securities available for sale 1,621,659 1,702,299 1,871,883 ) -4.7 % ) -13.4 %
Securities held to maturity 1,380,487 1,415,025 1,458,665 ) -2.4 % ) -5.4 %
Loans held for sale (LHFS) 185,698 172,937 181,094 7.4 % 2.5 %
Loans held for investment (LHFI) 13,155,418 13,057,943 12,613,967 0.7 % 4.3 %
ACL LHFI (154,685 ) (142,998 ) (129,298 ) ) -8.2 % ) -19.6 %
Net LHFI 13,000,733 12,914,945 12,484,669 0.7 % 4.1 %
Premises and equipment, net 232,681 232,630 227,293 0.0 % 2.4 %
Mortgage servicing rights 136,658 138,044 134,350 ) -1.0 % 1.7 %
Goodwill 334,605 334,605 334,605 0.0 % 0.0 %
Identifiable intangible assets 181 208 303 ) -13.0 % ) -40.3 %
Other real estate 6,586 7,620 1,137 ) -13.6 % n/m
Operating lease right-of-use assets 36,925 34,324 35,561 7.6 % 3.8 %
Other assets 694,133 744,821 783,457 ) -6.8 % ) -11.4 %
Assets of discontinued operations — 73,093 77,757 ) -100.0 % ) -100.0 %
Total assets $ 18,452,487 $ 18,376,612 $ 18,422,626 0.4 % 0.2 %
Deposits:
Noninterest-bearing $ 3,153,506 $ 3,039,652 $ 3,461,073 3.7 % ) -8.9 %
Interest-bearing 12,309,382 12,298,905 11,452,827 0.1 % 7.5 %
Total deposits 15,462,888 15,338,557 14,913,900 0.8 % 3.7 %
Fed funds purchased and repurchases 314,121 393,215 311,179 ) -20.1 % 0.9 %
Other borrowings 336,687 482,027 1,056,714 ) -30.2 % ) -68.1 %
Subordinated notes 123,592 123,537 123,372 0.0 % 0.2 %
Junior subordinated debt securities 61,856 61,856 61,856 0.0 % 0.0 %
ACL on off-balance sheet credit exposures 30,265 33,865 34,841 ) -10.6 % ) -13.1 %
Operating lease liabilities 40,517 37,792 38,172 7.2 % 6.1 %
Other liabilities 203,420 207,583 299,481 ) -2.0 % ) -32.1 %
Liabilities of discontinued operations — 15,581 11,918 ) -100.0 % ) -100.0 %
Total liabilities 16,573,346 16,694,013 16,851,433 ) -0.7 % ) -1.7 %
Common stock 12,753 12,747 12,724 0.0 % 0.2 %
Capital surplus 161,834 160,521 156,834 0.8 % 3.2 %
Retained earnings 1,796,111 1,736,485 1,667,339 3.4 % 7.7 %
Accumulated other comprehensive <br>   income (loss), net of tax (91,557 ) (227,154 ) (265,704 ) 59.7 % 65.5 %
Total shareholders' equity 1,879,141 1,682,599 1,571,193 11.7 % 19.6 %
Total liabilities and equity $ 18,452,487 $ 18,376,612 $ 18,422,626 0.4 % 0.2 %
n/m - percentage changes greater than +/- 100% are considered not meaningful

All values are in US Dollars.

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2024
($ in thousands except per share data)
(unaudited)
Quarter Ended Linked Quarter Year over Year
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
INCOME STATEMENTS 6/30/2024 3/31/2024 6/30/2023 Change % Change Change % Change
Interest and fees on LHFS & LHFI-FTE $ 216,399 $ 209,456 $ 192,941 3.3 % 12.2 %
Interest on securities-taxable 17,929 15,634 16,779 14.7 % 6.9 %
Interest on securities-tax exempt-FTE 1 4 69 ) -75.0 % ) -98.6 %
Interest on fed funds sold and reverse repurchases 2 1 45 100.0 % ) -95.6 %
Other interest income 8,124 8,110 12,077 0.2 % ) -32.7 %
Total interest income-FTE 242,455 233,205 221,911 4.0 % 9.3 %
Interest on deposits 83,681 83,716 54,409 ) 0.0 % 53.8 %
Interest on fed funds purchased and repurchases 5,663 5,591 4,865 1.3 % 16.4 %
Other interest expense 8,778 7,703 19,350 14.0 % ) -54.6 %
Total interest expense 98,122 97,010 78,624 1.1 % 24.8 %
Net interest income-FTE 144,333 136,195 143,287 6.0 % 0.7 %
Provision for credit losses (PCL), LHFI 14,696 7,708 8,211 90.7 % 79.0 %
PCL, off-balance sheet credit exposures (3,600 ) (192 ) 245 ) n/m ) n/m
PCL, LHFI sale of 1-4 family mortgage loans 8,633 — — n/m n/m
Net interest income after provision-FTE 124,604 128,679 134,831 ) 3.2 % ) -7.6 %
Service charges on deposit accounts 10,924 10,958 10,695 ) -0.3 % 2.1 %
Bank card and other fees 9,225 7,428 8,917 24.2 % 3.5 %
Mortgage banking, net 4,204 8,915 6,600 ) -52.8 % ) -36.3 %
Wealth management 9,692 8,952 8,882 8.3 % 9.1 %
Other, net 7,461 3,102 2,735 n/m n/m
Securities gains (losses), net (182,792 ) — — ) n/m ) n/m
Total noninterest income (loss) (141,286 ) 39,355 37,829 ) n/m ) n/m
Salaries and employee benefits 64,838 65,487 66,799 ) -1.0 % ) -2.9 %
Services and fees 24,743 24,431 27,821 1.3 % ) -11.1 %
Net occupancy-premises 7,265 7,270 6,897 ) -0.1 % 5.3 %
Equipment expense 6,241 6,325 6,337 ) -1.3 % ) -1.5 %
Other expense 15,239 16,151 13,767 ) -5.6 % 10.7 %
Total noninterest expense 118,326 119,664 121,621 ) -1.1 % ) -2.7 %
Income (loss) from continuing operations before <br>   income taxes and tax eq adj (135,008 ) 48,370 51,039 ) n/m ) n/m
Tax equivalent adjustment 3,304 3,365 3,383 ) -1.8 % ) -2.3 %
Income (loss) from continuing operations before<br>   income taxes (138,312 ) 45,005 47,656 ) n/m ) n/m
Income taxes from continuing operations (37,707 ) 6,832 6,452 ) n/m ) n/m
Income (loss) from continuing operations (100,605 ) 38,173 41,204 ) n/m ) n/m
Income from discontinued operations <br>   (discont. ops) before income taxes 232,640 4,512 5,127 n/m n/m
Income taxes from discont. ops 58,203 1,150 1,294 n/m n/m
Income from discont. ops 174,437 3,362 3,833 n/m n/m
Net income $ 73,832 $ 41,535 $ 45,037 77.8 % 63.9 %
Per share data (1)
Basic earnings (loss) per share from <br>   continuing operations $ (1.64 ) $ 0.62 $ 0.67 ) n/m ) n/m
Basic earnings per share from discont. ops $ 2.85 $ 0.05 $ 0.06 n/m n/m
Basic earnings per share - total $ 1.21 $ 0.68 $ 0.74 77.9 % 63.5 %
Diluted earnings (loss) per share from <br>   continuing operations $ (1.64 ) $ 0.62 $ 0.67 ) n/m ) n/m
Diluted earnings per share from discont. ops $ 2.84 $ 0.05 $ 0.06 n/m n/m
Diluted earnings per share - total $ 1.20 $ 0.68 $ 0.74 76.5 % 62.2 %
Dividends per share $ 0.23 $ 0.23 $ 0.23 0.0 % 0.0 %
Weighted average shares outstanding
Basic 61,196,820 61,128,425 61,063,277
Diluted 61,415,957 61,348,364 61,230,031
Period end shares outstanding 61,205,969 61,178,366 61,069,036
(1) Due to rounding, earnings (loss) per share from continuing operations and discontinued operations may not sum to earnings per share from net income.
n/m - percentage changes greater than +/- 100% are considered not meaningful

All values are in US Dollars.

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2024
($ in thousands)
(unaudited)
Quarter Ended Linked Quarter Year over Year
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
NONPERFORMING ASSETS 6/30/2024 3/31/2024 6/30/2023 Change % Change Change % Change
Nonaccrual LHFI
Alabama (1) $ 26,222 $ 23,261 $ 11,058 12.7 % n/m
Florida 614 585 334 5.0 % 83.8 %
Mississippi (2) 14,773 59,059 36,288 ) -75.0 % ) -59.3 %
Tennessee (3) 2,084 1,800 5,088 15.8 % ) -59.0 %
Texas 599 13,646 22,259 ) -95.6 % ) -97.3 %
Total nonaccrual LHFI 44,292 98,351 75,027 ) -55.0 % ) -41.0 %
Other real estate
Alabama (1) 485 1,050 — ) -53.8 % n/m
Florida — 71 — ) -100.0 % n/m
Mississippi (2) 1,787 2,870 1,137 ) -37.7 % 57.2 %
Tennessee (3) 86 86 — 0.0 % n/m
Texas 4,228 3,543 — 19.3 % n/m
Total other real estate 6,586 7,620 1,137 ) -13.6 % n/m
Total nonperforming assets $ 50,878 $ 105,971 $ 76,164 ) -52.0 % ) -33.2 %
LOANS PAST DUE OVER 90 DAYS
LHFI $ 5,413 $ 5,243 $ 3,911 3.2 % 38.4 %
LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase) $ 58,079 $ 56,530 $ 35,766 2.7 % 62.4 %
Quarter Ended Linked Quarter Year over Year
ACL LHFI 6/30/2024 3/31/2024 6/30/2023 Change % Change Change % Change
Beginning Balance $ 142,998 $ 139,367 $ 122,239 2.6 % 17.0 %
PCL, LHFI 14,696 7,708 8,211 90.7 % 79.0 %
PCL, LHFI sale of 1-4 family mortgage loans 8,633 — — n/m n/m
Charge-offs, sale of 1-4 family mortgage loans (8,633 ) — — ) n/m ) n/m
Charge-offs (5,120 ) (6,324 ) (2,773 ) 19.0 % ) 84.6 %
Recoveries 2,111 2,247 1,621 ) -6.1 % 30.2 %
Net (charge-offs) recoveries (11,642 ) (4,077 ) (1,152 ) ) n/m ) n/m
Ending Balance $ 154,685 $ 142,998 $ 129,298 8.2 % 19.6 %
NET (CHARGE-OFFS) RECOVERIES
Alabama (1) $ 59 $ (341 ) $ (141 ) n/m n/m
Florida 4 277 (35 ) ) -98.6 % n/m
Mississippi (2) (9,112 ) (1,489 ) (762 ) ) n/m ) n/m
Tennessee (3) (122 ) (179 ) (166 ) 31.8 % 26.5 %
Texas (2,471 ) (2,345 ) (48 ) ) -5.4 % ) n/m
Total net (charge-offs) recoveries $ (11,642 ) $ (4,077 ) $ (1,152 ) ) n/m ) n/m
(1) Alabama includes the Georgia Loan Production Office.
(2) Mississippi includes Central and Southern Mississippi Regions.
(3) Tennessee includes Memphis, Tennessee and Northern Mississippi Regions.
n/m - percentage changes greater than +/- 100% are considered not meaningful

All values are in US Dollars.

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2024
($ in thousands)
(unaudited)
Quarter Ended Six Months Ended
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
AVERAGE BALANCES 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
Securities AFS-taxable $ 1,866,227 $ 1,927,619 $ 1,986,825 $ 2,049,006 $ 2,140,505 $ 1,896,923 $ 2,163,684
Securities AFS-nontaxable — — 4,246 4,779 4,796 — 4,804
Securities HTM-taxable 1,421,246 1,418,476 1,430,169 1,445,895 1,463,086 1,419,861 1,471,140
Securities HTM-nontaxable 112 340 340 907 1,718 226 3,106
Total securities 3,287,585 3,346,435 3,421,580 3,500,587 3,610,105 3,317,010 3,642,734
Loans (includes loans held for sale) 13,309,127 13,169,805 13,010,028 12,926,942 12,732,057 13,239,466 12,631,810
Fed funds sold and reverse repurchases 110 114 121 230 3,275 112 2,829
Other earning assets 592,625 571,215 670,477 682,644 903,027 581,920 780,657
Total earning assets 17,189,447 17,087,569 17,102,206 17,110,403 17,248,464 17,138,508 17,058,030
ACL LHFI (143,245 ) (138,711 ) (133,742 ) (127,915 ) (121,960 ) (140,978 ) (120,974 )
Other assets 1,740,307 1,730,521 1,749,069 1,721,310 1,648,583 1,735,414 1,700,643
Total assets $ 18,786,509 $ 18,679,379 $ 18,717,533 $ 18,703,798 $ 18,775,087 $ 18,732,944 $ 18,637,699
Interest-bearing demand deposits $ 5,222,369 $ 5,291,779 $ 5,053,935 $ 4,875,714 $ 4,803,737 $ 5,257,074 $ 4,777,591
Savings deposits 3,653,966 3,686,027 3,526,600 3,642,158 4,002,134 3,669,997 4,097,420
Time deposits 3,346,046 3,321,601 3,427,384 3,075,224 2,335,752 3,333,824 2,122,784
Total interest-bearing deposits 12,222,381 12,299,407 12,007,919 11,593,096 11,141,623 12,260,895 10,997,795
Fed funds purchased and repurchases 434,760 428,127 403,041 414,696 389,834 431,444 413,055
Other borrowings 534,350 463,459 590,765 912,151 1,330,010 498,905 1,221,032
Subordinated notes 123,556 123,501 123,446 123,391 123,337 123,529 123,309
Junior subordinated debt securities 61,856 61,856 61,856 61,856 61,856 61,856 61,856
Total interest-bearing liabilities 13,376,903 13,376,350 13,187,027 13,105,190 13,046,660 13,376,629 12,817,047
Noninterest-bearing deposits 3,183,524 3,120,566 3,296,351 3,429,815 3,595,927 3,152,045 3,703,987
Other liabilities 498,593 505,942 641,662 585,908 552,209 502,265 564,450
Total liabilities 17,059,020 17,002,858 17,125,040 17,120,913 17,194,796 17,030,939 17,085,484
Shareholders' equity 1,727,489 1,676,521 1,592,493 1,582,885 1,580,291 1,702,005 1,552,215
Total liabilities and equity $ 18,786,509 $ 18,679,379 $ 18,717,533 $ 18,703,798 $ 18,775,087 $ 18,732,944 $ 18,637,699

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2024
($ in thousands)
(unaudited)
PERIOD END BALANCES 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Cash and due from banks $ 822,141 $ 606,061 $ 975,343 $ 750,292 $ 831,852
Securities available for sale 1,621,659 1,702,299 1,762,878 1,766,174 1,871,883
Securities held to maturity 1,380,487 1,415,025 1,426,279 1,438,287 1,458,665
LHFS 185,698 172,937 184,812 169,244 181,094
LHFI 13,155,418 13,057,943 12,950,524 12,810,259 12,613,967
ACL LHFI (154,685 ) (142,998 ) (139,367 ) (134,031 ) (129,298 )
Net LHFI 13,000,733 12,914,945 12,811,157 12,676,228 12,484,669
Premises and equipment, net 232,681 232,630 232,229 230,402 227,293
Mortgage servicing rights 136,658 138,044 131,870 142,379 134,350
Goodwill 334,605 334,605 334,605 334,605 334,605
Identifiable intangible assets 181 208 236 269 303
Other real estate 6,586 7,620 6,867 5,485 1,137
Operating lease right-of-use assets 36,925 34,324 35,711 37,115 35,561
Other assets 694,133 744,821 752,568 770,684 783,457
Assets of discontinued operations — 73,093 67,634 69,675 77,757
Total assets $ 18,452,487 $ 18,376,612 $ 18,722,189 $ 18,390,839 $ 18,422,626
Deposits:
Noninterest-bearing $ 3,153,506 $ 3,039,652 $ 3,197,620 $ 3,320,124 $ 3,461,073
Interest-bearing 12,309,382 12,298,905 12,372,143 11,781,799 11,452,827
Total deposits 15,462,888 15,338,557 15,569,763 15,101,923 14,913,900
Fed funds purchased and repurchases 314,121 393,215 405,745 321,799 311,179
Other borrowings 336,687 482,027 483,230 793,193 1,056,714
Subordinated notes 123,592 123,537 123,482 123,427 123,372
Junior subordinated debt securities 61,856 61,856 61,856 61,856 61,856
ACL on off-balance sheet credit exposures 30,265 33,865 34,057 34,945 34,841
Operating lease liabilities 40,517 37,792 39,097 40,150 38,172
Other liabilities 203,420 207,583 331,085 331,066 299,481
Liabilities of discontinued operations — 15,581 12,027 12,129 11,918
Total liabilities 16,573,346 16,694,013 17,060,342 16,820,488 16,851,433
Common stock 12,753 12,747 12,725 12,724 12,724
Capital surplus 161,834 160,521 159,688 158,316 156,834
Retained earnings 1,796,111 1,736,485 1,709,157 1,687,199 1,667,339
Accumulated other comprehensive income (loss), <br>   net of tax (91,557 ) (227,154 ) (219,723 ) (287,888 ) (265,704 )
Total shareholders' equity 1,879,141 1,682,599 1,661,847 1,570,351 1,571,193
Total liabilities and equity $ 18,452,487 $ 18,376,612 $ 18,722,189 $ 18,390,839 $ 18,422,626

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2024
($ in thousands except per share data)
(unaudited)
Quarter Ended Six Months Ended
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
INCOME STATEMENTS 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
Interest and fees on LHFS & LHFI-FTE $ 216,399 $ 209,456 $ 210,288 $ 206,523 $ 192,941 $ 425,855 $ 371,908
Interest on securities-taxable 17,929 15,634 15,936 16,624 16,779 33,563 33,540
Interest on securities-tax exempt-FTE 1 4 44 58 69 5 161
Interest on fed funds sold and reverse repurchases 2 1 2 3 45 3 75
Other interest income 8,124 8,110 9,918 8,613 12,077 16,234 18,604
Total interest income-FTE 242,455 233,205 236,188 231,821 221,911 475,660 424,288
Interest on deposits 83,681 83,716 80,847 69,797 54,409 167,397 95,307
Interest on fed funds purchased and repurchases 5,663 5,591 5,347 5,375 4,865 11,254 9,697
Other interest expense 8,778 7,703 9,946 14,713 19,350 16,481 34,925
Total interest expense 98,122 97,010 96,140 89,885 78,624 195,132 139,929
Net interest income-FTE 144,333 136,195 140,048 141,936 143,287 280,528 284,359
PCL, LHFI 14,696 7,708 7,585 8,322 8,211 22,404 11,455
PCL, off-balance sheet credit exposures (3,600 ) (192 ) (888 ) 104 245 (3,792 ) (1,997 )
PCL, LHFI sale of 1-4 family mortgage loans 8,633 — — — — 8,633 —
Net interest income after provision-FTE 124,604 128,679 133,351 133,510 134,831 253,283 274,901
Service charges on deposit accounts 10,924 10,958 11,311 11,074 10,695 21,882 21,031
Bank card and other fees 9,225 7,428 8,502 8,217 8,917 16,653 16,720
Mortgage banking, net 4,204 8,915 5,519 6,458 6,600 13,119 14,239
Wealth management 9,692 8,952 8,657 8,773 8,882 18,644 17,662
Other, net 7,461 3,102 2,577 2,399 2,735 10,563 5,255
Securities gains (losses), net (182,792 ) — 39 — — (182,792 ) —
Total noninterest income (loss) (141,286 ) 39,355 36,605 36,921 37,829 (101,931 ) 74,907
Salaries and employee benefits 64,838 65,487 69,326 67,374 66,799 130,325 131,571
Services and fees 24,743 24,431 27,478 27,472 27,821 49,174 52,855
Net occupancy-premises 7,265 7,270 7,144 7,151 6,897 14,535 14,212
Equipment expense 6,241 6,325 6,457 6,755 6,337 12,566 12,632
Litigation settlement expense — — — 6,500 — — —
Other expense 15,239 16,151 15,790 15,039 13,767 31,390 27,940
Total noninterest expense 118,326 119,664 126,195 130,291 121,621 237,990 239,210
Income (loss) from continuing operations before <br>   income taxes and tax eq adj (135,008 ) 48,370 43,761 40,140 51,039 (86,638 ) 110,598
Tax equivalent adjustment 3,304 3,365 3,306 3,299 3,383 6,669 6,860
Income (loss) from continuing operations before <br>   income taxes (138,312 ) 45,005 40,455 36,841 47,656 (93,307 ) 103,738
Income taxes from continuing operations (37,707 ) 6,832 6,567 6,288 6,452 (30,875 ) 14,889
Income (loss) from continuing operations (100,605 ) 38,173 33,888 30,553 41,204 (62,432 ) 88,849
Income from discontinued operations <br>   (discont. ops) before income taxes 232,640 4,512 2,965 4,649 5,127 237,152 8,688
Income taxes from discontinued operations 58,203 1,150 730 1,173 1,294 59,353 2,200
Income from discont. ops 174,437 3,362 2,235 3,476 3,833 177,799 6,488
Net income $ 73,832 $ 41,535 $ 36,123 $ 34,029 $ 45,037 $ 115,367 $ 95,337
Per share data (1)
Basic earnings (loss) per share from continuing <br>   operations $ (1.64 ) $ 0.62 $ 0.55 $ 0.50 $ 0.67 $ (1.02 ) $ 1.46
Basic earnings per share from discont. ops $ 2.85 $ 0.05 $ 0.04 $ 0.06 $ 0.06 $ 2.91 $ 0.11
Basic earnings per share - total $ 1.21 $ 0.68 $ 0.59 $ 0.56 $ 0.74 $ 1.89 $ 1.56
Diluted earnings (loss) per share from continuing <br>   operations $ (1.64 ) $ 0.62 $ 0.55 $ 0.50 $ 0.67 $ (1.02 ) $ 1.45
Diluted earnings per share from discont. ops $ 2.84 $ 0.05 $ 0.04 $ 0.06 $ 0.06 $ 2.90 $ 0.11
Diluted earnings per share - total $ 1.20 $ 0.68 $ 0.59 $ 0.56 $ 0.74 $ 1.88 $ 1.56
Dividends per share $ 0.23 $ 0.23 $ 0.23 $ 0.23 $ 0.23 $ 0.46 $ 0.46
Weighted average shares outstanding
Basic 61,196,820 61,128,425 61,070,481 61,069,750 61,063,277 61,162,623 61,037,312
Diluted 61,415,957 61,348,364 61,296,840 61,263,032 61,230,031 61,373,850 61,206,799
Period end shares outstanding 61,205,969 61,178,366 61,071,173 61,070,095 61,069,036 61,205,969 61,069,036
(1) Due to rounding, earnings (loss) per share from continuing operations and discontinued operations may not sum to earnings per share from net income.

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2024
($ in thousands)
(unaudited)
Quarter Ended
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
NONPERFORMING ASSETS 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
Nonaccrual LHFI
Alabama (1) $ 26,222 $ 23,261 $ 23,271 $ 23,530 $ 11,058
Florida 614 585 170 151 334
Mississippi (2) 14,773 59,059 54,615 45,050 36,288
Tennessee (3) 2,084 1,800 1,802 1,841 5,088
Texas 599 13,646 20,150 20,327 22,259
Total nonaccrual LHFI 44,292 98,351 100,008 90,899 75,027
Other real estate
Alabama (1) 485 1,050 1,397 315 —
Florida — 71 — — —
Mississippi (2) 1,787 2,870 1,242 942 1,137
Tennessee (3) 86 86 — — —
Texas 4,228 3,543 4,228 4,228 —
Total other real estate 6,586 7,620 6,867 5,485 1,137
Total nonperforming assets $ 50,878 $ 105,971 $ 106,875 $ 96,384 $ 76,164
LOANS PAST DUE OVER 90 DAYS
LHFI $ 5,413 $ 5,243 $ 5,790 $ 3,804 $ 3,911
LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase) $ 58,079 $ 56,530 $ 51,243 $ 42,532 $ 35,766
Quarter Ended Six Months Ended
ACL LHFI 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
Beginning Balance $ 142,998 $ 139,367 $ 134,031 $ 129,298 $ 122,239 $ 139,367 $ 120,214
PCL, LHFI 14,696 7,708 7,585 8,322 8,211 22,404 11,455
PCL, LHFI sale of 1-4 family mortgage loans 8,633 — — — — 8,633 —
Charge-offs, sale of 1-4 family mortgage loans (8,633 ) — — — — (8,633 ) —
Charge-offs (5,120 ) (6,324 ) (4,250 ) (7,496 ) (2,773 ) (11,444 ) (5,769 )
Recoveries 2,111 2,247 2,001 3,907 1,621 4,358 3,398
Net (charge-offs) recoveries (11,642 ) (4,077 ) (2,249 ) (3,589 ) (1,152 ) (15,719 ) (2,371 )
Ending Balance $ 154,685 $ 142,998 $ 139,367 $ 134,031 $ 129,298 $ 154,685 $ 129,298
NET (CHARGE-OFFS) RECOVERIES
Alabama (1) $ 59 $ (341 ) $ (299 ) $ (165 ) $ (141 ) $ (282 ) $ (409 )
Florida 4 277 180 21 (35 ) 281 (71 )
Mississippi (2) (9,112 ) (1,489 ) (1,943 ) (1,867 ) (762 ) (10,601 ) (1,537 )
Tennessee (3) (122 ) (179 ) (193 ) 2,127 (166 ) (301 ) (290 )
Texas (2,471 ) (2,345 ) 6 (3,705 ) (48 ) (4,816 ) (64 )
Total net (charge-offs) recoveries $ (11,642 ) $ (4,077 ) $ (2,249 ) $ (3,589 ) $ (1,152 ) $ (15,719 ) $ (2,371 )
(1) Alabama includes the Georgia Loan Production Office.
(2) Mississippi includes Central and Southern Mississippi Regions.
(3) Tennessee includes Memphis, Tennessee and Northern Mississippi Regions.

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
June 30, 2024
(unaudited)
Quarter Ended Six Months Ended
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
FINANCIAL RATIOS AND OTHER DATA 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
Return on average equity from continuing operations -23.42 % 9.16 % 8.44 % 7.66 % 10.46 % -7.38 % 11.54 %
Return on average equity from adjusted <br>   continuing operations (1) 9.06 % 9.16 % 8.68 % 8.87 % 10.46 % 9.11 % 11.54 %
Return on average equity - total 17.19 % 9.96 % 9.00 % 8.53 % 11.43 % 13.63 % 12.39 %
Return on average tangible equity from <br>   continuing operations -29.05 % 11.45 % 10.70 % 9.72 % 13.28 % -9.18 % 14.75 %
Return on average tangible equity from adjusted <br>   continuing operations (1) 11.14 % 11.45 % 10.98 % 11.25 % 13.28 % 11.29 % 14.75 %
Return on average tangible equity - total 21.91 % 12.98 % 11.92 % 11.32 % 15.18 % 17.56 % 16.56 %
Return on average assets from continuing operations -2.16 % 0.83 % 0.72 % 0.65 % 0.88 % -0.67 % 0.97 %
Return on average assets from adjusted <br>   continuing operations (1) 0.87 % 0.83 % 0.74 % 0.75 % 0.88 % 0.85 % 0.97 %
Return on average assets - total 1.58 % 0.89 % 0.77 % 0.72 % 0.96 % 1.24 % 1.03 %
Interest margin - Yield - FTE 5.67 % 5.49 % 5.48 % 5.38 % 5.16 % 5.58 % 5.02 %
Interest margin - Cost 2.30 % 2.28 % 2.23 % 2.08 % 1.83 % 2.29 % 1.65 %
Net interest margin - FTE 3.38 % 3.21 % 3.25 % 3.29 % 3.33 % 3.29 % 3.36 %
Efficiency ratio (2) 63.81 % 66.90 % 69.76 % 68.27 % 66.12 % 65.32 % 65.52 %
Full-time equivalent employees 2,515 2,712 2,757 2,756 2,761
CREDIT QUALITY RATIOS
Net (recoveries) charge-offs (excl sale of <br>   1-4 family mortgage loans) / average loans 0.09 % 0.12 % 0.07 % 0.11 % 0.04 % 0.11 % 0.04 %
PCL, LHFI (excl PCL, LHFI sale of <br>    1-4 family mortgage loans) / average loans 0.44 % 0.24 % 0.23 % 0.26 % 0.26 % 0.34 % 0.18 %
Nonaccrual LHFI / (LHFI + LHFS) 0.33 % 0.74 % 0.76 % 0.70 % 0.59 %
Nonperforming assets / (LHFI + LHFS) 0.38 % 0.80 % 0.81 % 0.74 % 0.60 %
Nonperforming assets / (LHFI + LHFS <br>   + other real estate) 0.38 % 0.80 % 0.81 % 0.74 % 0.60 %
ACL LHFI / LHFI 1.18 % 1.10 % 1.08 % 1.05 % 1.03 %
ACL LHFI-commercial / commercial LHFI 1.05 % 0.93 % 0.85 % 0.86 % 0.84 %
ACL LHFI-consumer / consumer and <br>   home mortgage LHFI 1.59 % 1.63 % 1.81 % 1.66 % 1.60 %
ACL LHFI / nonaccrual LHFI 349.24 % 145.39 % 139.36 % 147.45 % 172.34 %
ACL LHFI / nonaccrual LHFI <br>   (excl individually analyzed loans) 840.20 % 235.29 % 249.31 % 273.60 % 301.44 %
CAPITAL RATIOS
Total equity / total assets 10.18 % 9.16 % 8.88 % 8.54 % 8.53 %
Tangible equity / tangible assets 8.52 % 7.47 % 7.22 % 6.84 % 6.83 %
Tangible equity / risk-weighted assets 10.18 % 8.83 % 8.76 % 8.16 % 8.26 %
Tier 1 leverage ratio 9.29 % 8.76 % 8.62 % 8.49 % 8.35 %
Common equity tier 1 capital ratio 10.92 % 10.12 % 10.04 % 9.89 % 9.87 %
Tier 1 risk-based capital ratio 11.31 % 10.51 % 10.44 % 10.29 % 10.27 %
Total risk-based capital ratio 13.29 % 12.42 % 12.29 % 12.11 % 12.08 %
STOCK PERFORMANCE
Market value-Close $ 30.04 $ 28.11 $ 27.88 $ 21.73 $ 21.12
Book value $ 30.70 $ 27.50 $ 27.21 $ 25.71 $ 25.73
Tangible book value $ 25.23 $ 22.03 $ 21.73 $ 20.23 $ 20.24
(1) Adjusted continuing operations excludes significant non-routine transactions. See Note 7 - Non-GAAP Financials Measures
in the Notes to the Consolidated Financials.
(2) See Note 7 – Non-GAAP Financial Measures in the Notes to Consolidated Financials for Trustmark’s efficiency ratio calculation.

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIALS
June 30, 2024
($ in thousands)
(unaudited)

Note 1 - Significant Non-Routine Transactions

Trustmark completed the following significant non-routine transactions during the second quarter of 2024:

  • On May 31, 2024, Trustmark National Bank closed the sale of its wholly owned subsidiary, Fisher Brown Bottrell Insurance, Inc., (FBBI) to Marsh & McLennan Agency LLC, consistent with the terms as previously announced on April 23, 2024. Trustmark National Bank is a wholly owned subsidiary of Trustmark Corporation. Trustmark recognized a gain on the sale of $228.3 million ($171.2 million, net of taxes) in income from discontinued operations. The operations of FBBI are also included in discontinued operations for the current and prior periods.
  • Trustmark restructured its investment securities portfolio by selling $1.561 billion of available for sale securities with an average yield of 1.36%, which generated a loss of $182.8 million ($137.1 million, net of taxes) and was recorded to noninterest income in securities gains (losses), net. Trustmark purchased $1.378 billion of available for sale securities with an average yield of 4.85%.
  • Trustmark sold a portfolio of 1-4 family mortgage loans that were three payments delinquent and/or nonaccrual at the time of selection totaling $56.2 million, which resulted in a loss of $13.4 million ($10.1 million, net of taxes). The portion of the loss related to credit totaled $8.6 million and was recorded as adjustments to charge-offs and the provision for credit losses. The noncredit-related portion of the loss totaled $4.8 million and was recorded to noninterest income in other, net.
  • On April 8, 2024, Visa commenced an initial exchange offer expiring on May 3, 2024, for any and all outstanding shares of Visa Class B-1 common stock (Visa B-1 shares). Holders participating in the exchange offer would receive a combination of Visa Class B-2 common stock (Visa B-2 shares) and Visa Class C common stock (Visa C shares) in exchange for Visa B-1 shares that are validly tendered and accepted for exchange by Visa. TNB tendered its 38.7 thousand Visa B-1 shares, which was accepted by Visa. In exchange for each Visa B-1 share that was validly tendered and accepted for exchange by Visa, TNB received 50.0% of a newly issued Visa B-2 share and newly issued Visa C shares equivalent in value to 50.0% of a Visa B-1 share. The Visa C shares that were received by TNB were recognized at fair value, which resulted in a gain of $8.1 million ($6.0 million, net of taxes) and recorded to noninterest income in other, net during the second quarter of 2024. The Visa B-2 shares were recorded at their nominal carrying value.

Note 2 - Securities Available for Sale and Held to Maturity

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

6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
SECURITIES AVAILABLE FOR SALE
U.S. Treasury securities $ 172,955 $ 372,424 $ 372,368 $ 363,476 $ 362,966
U.S. Government agency obligations — 5,594 5,792 6,780 6,999
Obligations of states and political subdivisions — — — 4,642 4,813
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA 23,489 22,232 23,135 22,881 25,336
Issued by FNMA and FHLMC 1,060,869 1,129,521 1,176,798 1,171,521 1,250,435
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA — 79,099 86,074 90,402 98,388
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA 364,346 93,429 98,711 106,472 122,946
Total securities available for sale $ 1,621,659 $ 1,702,299 $ 1,762,878 $ 1,766,174 $ 1,871,883
SECURITIES HELD TO MATURITY
U.S. Treasury securities $ 29,455 $ 29,261 $ 29,068 $ 28,872 $ 28,679
Obligations of states and political subdivisions — 340 340 341 1,180
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA 17,998 18,387 13,005 13,090 13,235
Issued by FNMA and FHLMC 449,781 461,457 469,593 474,003 484,679
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA 138,951 146,447 154,466 162,031 171,002
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA 744,302 759,133 759,807 759,950 759,890
Total securities held to maturity $ 1,380,487 $ 1,415,025 $ 1,426,279 $ 1,438,287 $ 1,458,665

At June 30, 2024, the net unamortized, unrealized loss included in accumulated other comprehensive income (loss) in the accompanying balance sheet for securities held to maturity transferred from securities available for sale totaled $52.1 million.

Management continues to focus on asset quality as one of the strategic goals of the securities portfolio, which is evidenced by the investment of 100.0% of the portfolio in U.S. Treasury securities, GSE-backed obligations and other Aaa rated securities as determined by Moody’s. None of the securities owned by Trustmark are collateralized by assets which are considered sub-prime. Furthermore, outside of stock ownership in the Federal Home Loan Bank of Dallas and Federal Reserve Bank, Trustmark does not hold any other equity investment in a GSE.

TRUSTMARK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIALS
June 30, 2024
($ in thousands)
(unaudited)

Note 3 – Loan Composition

LHFI consisted of the following during the periods presented:

LHFI BY TYPE 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
Loans secured by real estate:
Construction, land development and other land loans $ 1,638,972 $ 1,539,461 $ 1,510,679 $ 1,609,326 $ 1,722,657
Secured by 1-4 family residential properties 2,878,295 2,891,481 2,904,715 2,893,606 2,854,182
Secured by nonfarm, nonresidential properties 3,598,647 3,543,235 3,489,434 3,569,671 3,471,728
Other real estate secured 1,344,968 1,384,610 1,312,551 1,218,499 954,410
Commercial and industrial loans 1,880,607 1,922,711 1,922,910 1,828,924 1,883,480
Consumer loans 153,316 156,430 161,725 161,940 163,788
State and other political subdivision loans 1,053,015 1,052,844 1,088,466 1,056,569 1,111,710
Other loans and leases 607,598 567,171 560,044 471,724 452,012
LHFI 13,155,418 13,057,943 12,950,524 12,810,259 12,613,967
ACL LHFI (154,685 ) (142,998 ) (139,367 ) (134,031 ) (129,298 )
Net LHFI $ 13,000,733 $ 12,914,945 $ 12,811,157 $ 12,676,228 $ 12,484,669

The following table presents the LHFI composition based upon the region where the loan was originated and reflects each region’s diversified mix of loans:

June 30, 2024
LHFI - COMPOSITION BY REGION Total Alabama (1) Florida Mississippi <br>(Central and <br>Southern <br>Regions) Tennessee <br>(Memphis, TN and <br>Northern MS<br>Regions) Texas
Loans secured by real estate:
Construction, land development and other land loans $ 1,638,972 $ 832,891 $ 35,147 $ 366,893 $ 41,046 $ 362,995
Secured by 1-4 family residential properties 2,878,295 152,184 60,268 2,546,223 83,469 36,151
Secured by nonfarm, nonresidential properties 3,598,647 1,052,737 226,977 1,512,307 133,835 672,791
Other real estate secured 1,344,968 560,797 1,703 370,854 6,384 405,230
Commercial and industrial loans 1,880,607 676,858 22,064 802,334 151,496 227,855
Consumer loans 153,316 21,806 7,084 93,505 16,814 14,107
State and other political subdivision loans 1,053,015 72,787 51,084 796,947 23,672 108,525
Other loans and leases 607,598 285,089 8,505 202,159 43,062 68,783
Loans $ 13,155,418 $ 3,655,149 $ 412,832 $ 6,691,222 $ 499,778 $ 1,896,437
CONSTRUCTION, LAND DEVELOPMENT AND OTHER LAND LOANS BY REGION
Lots $ 72,597 $ 27,887 $ 7,284 $ 19,673 $ 6,506 $ 11,247
Development 122,826 56,857 878 25,218 12,502 27,371
Unimproved land 104,436 19,762 12,051 27,149 7,859 37,615
1-4 family construction 316,669 171,134 10,214 91,849 14,179 29,293
Other construction 1,022,444 557,251 4,720 203,004 — 257,469
Construction, land development and other land loans $ 1,638,972 $ 832,891 $ 35,147 $ 366,893 $ 41,046 $ 362,995
(1) Includes Georgia Loan Production Office.
TRUSTMARK CORPORATION AND SUBSIDIARIES
---
NOTES TO CONSOLIDATED FINANCIALS
June 30, 2024
($ in thousands)
(unaudited)

Note 3 – Loan Composition (continued)

June 30, 2024
Total Alabama (1) Florida Mississippi <br>(Central and <br>Southern <br>Regions) Tennessee <br>(Memphis, TN and <br>Northern MS<br>Regions) Texas
LOANS SECURED BY NONFARM, NONRESIDENTIAL PROPERTIES BY REGION
Non-owner occupied:
Retail $ 331,174 $ 115,459 $ 22,998 $ 95,638 $ 16,980 $ 80,099
Office 257,391 100,383 19,451 72,173 1,546 63,838
Hotel/motel 278,437 128,705 47,859 76,834 25,039 —
Mini-storage 145,336 41,249 1,678 89,905 639 11,865
Industrial 509,631 137,814 18,914 178,304 2,985 171,614
Health care 120,089 92,200 680 24,600 329 2,280
Convenience stores 25,609 2,947 413 13,989 228 8,032
Nursing homes/senior living 527,800 227,059 — 200,257 4,546 95,938
Other 118,763 32,470 8,757 60,783 8,042 8,711
Total non-owner occupied loans 2,314,230 878,286 120,750 812,483 60,334 442,377
Owner-occupied:
Office 146,066 43,808 35,796 36,678 11,224 18,560
Churches 55,308 13,697 4,010 31,652 3,503 2,446
Industrial warehouses 158,118 11,309 4,503 39,103 15,009 88,194
Health care 122,993 11,253 8,210 84,065 2,233 17,232
Convenience stores 132,276 11,807 29,012 57,593 — 33,864
Retail 91,918 9,190 14,488 51,438 8,407 8,395
Restaurants 36,809 4,019 2,870 9,593 16,509 3,818
Auto dealerships 41,127 4,765 187 20,475 15,700 —
Nursing homes/senior living 368,429 52,648 — 289,669 — 26,112
Other 131,373 11,955 7,151 79,558 916 31,793
Total owner-occupied loans 1,284,417 174,451 106,227 699,824 73,501 230,414
Loans secured by nonfarm, nonresidential properties $ 3,598,647 $ 1,052,737 $ 226,977 $ 1,512,307 $ 133,835 $ 672,791
(1) Includes Georgia Loan Production Office.

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 Six Months Ended
6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
Securities – taxable 2.19 % 1.88 % 1.85 % 1.89 % 1.87 % 2.03 % 1.86 %
Securities – nontaxable 3.59 % 4.73 % 3.81 % 4.05 % 4.25 % 4.45 % 4.10 %
Securities – total 2.19 % 1.88 % 1.85 % 1.89 % 1.87 % 2.04 % 1.87 %
LHFI & LHFS 6.54 % 6.40 % 6.41 % 6.34 % 6.08 % 6.47 % 5.94 %
Fed funds sold & reverse repurchases 7.31 % 3.53 % 6.56 % 5.17 % 5.51 % 5.39 % 5.35 %
Other earning assets 5.51 % 5.71 % 5.87 % 5.01 % 5.36 % 5.61 % 4.81 %
Total earning assets 5.67 % 5.49 % 5.48 % 5.38 % 5.16 % 5.58 % 5.02 %
Interest-bearing deposits 2.75 % 2.74 % 2.67 % 2.39 % 1.96 % 2.75 % 1.75 %
Fed funds purchased & repurchases 5.24 % 5.25 % 5.26 % 5.14 % 5.01 % 5.25 % 4.73 %
Other borrowings 4.91 % 4.78 % 5.08 % 5.32 % 5.12 % 4.84 % 5.01 %
Total interest-bearing liabilities 2.95 % 2.92 % 2.89 % 2.72 % 2.42 % 2.93 % 2.20 %
Total Deposits 2.18 % 2.18 % 2.10 % 1.84 % 1.48 % 2.18 % 1.31 %
Net interest margin 3.38 % 3.21 % 3.25 % 3.29 % 3.33 % 3.29 % 3.36 %
TRUSTMARK CORPORATION AND SUBSIDIARIES
---
NOTES TO CONSOLIDATED FINANCIALS
June 30, 2024
($ in thousands)
(unaudited)

Note 4 – Yields on Earning Assets and Interest-Bearing Liabilities (continued)

Reflected in the table above are yields on earning assets and liabilities, along with the net interest margin which equals reported net interest income-FTE, annualized, as a percent of average earning assets.

The net interest margin increased 17 basis points when compared to the first quarter of 2024, totaling 3.38% for the second quarter of 2024, primarily due to increased yields on the securities portfolio and the loans held for investment and held for sale portfolio as well as the costs of interest-bearing deposits remaining relatively flat.

Note 5 – Mortgage Banking

Trustmark utilizes a portfolio of exchange-traded derivative instruments, such as Treasury note futures contracts and option contracts, to achieve a fair value return that offsets the changes in fair value of mortgage servicing rights (MSR) attributable to interest rates. These transactions are considered freestanding derivatives that do not otherwise qualify for hedge accounting under generally accepted accounting principles (GAAP). Changes in the fair value of these exchange-traded derivative instruments, including administrative costs, are recorded in noninterest income in mortgage banking, net and are offset by the changes in the fair value of the MSR. The MSR fair value represents the present value of future cash flows, which among other things includes decay and the effect of changes in interest rates. Ineffectiveness of hedging the MSR fair value is measured by comparing the change in value of hedge instruments to the change in the fair value of the MSR asset attributable to changes in interest rates and other market driven changes in valuation inputs and assumptions. The impact of this strategy resulted in a net negative hedge ineffectiveness of $4.5 million during the second quarter of 2024.

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

Quarter Ended Six Months Ended
6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
Mortgage servicing income, net $ 6,993 $ 6,934 $ 6,731 $ 6,916 $ 6,764 $ 13,927 $ 13,549
Change in fair value-MSR from runoff (3,447 ) (1,926 ) (2,972 ) (3,203 ) (2,710 ) (5,373 ) (3,855 )
Gain on sales of loans, net 5,151 5,009 3,913 3,748 3,887 10,160 7,684
Mortgage banking income before hedge <br>   ineffectiveness 8,697 10,017 7,672 7,461 7,941 18,714 17,378
Change in fair value-MSR from market changes (1,626 ) 5,123 (10,224 ) 6,809 5,898 3,497 1,926
Change in fair value of derivatives (2,867 ) (6,225 ) 8,071 (7,812 ) (7,239 ) (9,092 ) (5,065 )
Net positive (negative) hedge ineffectiveness (4,493 ) (1,102 ) (2,153 ) (1,003 ) (1,341 ) (5,595 ) (3,139 )
Mortgage banking, net $ 4,204 $ 8,915 $ 5,519 $ 6,458 $ 6,600 $ 13,119 $ 14,239
TRUSTMARK CORPORATION AND SUBSIDIARIES
---
NOTES TO CONSOLIDATED FINANCIALS
June 30, 2024
($ in thousands)
(unaudited)

Note 6 – Other Noninterest Income and Expense

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

Quarter Ended Six Months Ended
6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
Partnership amortization for tax credit purposes $ (1,824 ) $ (1,834 ) $ (2,013 ) $ (1,995 ) $ (2,019 ) $ (3,658 ) $ (3,980 )
Increase in life insurance cash surrender value 1,860 1,844 1,825 1,784 1,716 3,704 3,409
Loss on sale of 1-4 family mortgage loans (4,798 ) — — — — (4,798 ) —
Visa C shares fair value adjustment 8,056 — — — — 8,056 —
Other miscellaneous income 4,167 3,092 2,765 2,610 3,038 7,259 5,826
Total other, net $ 7,461 $ 3,102 $ 2,577 $ 2,399 $ 2,735 $ 10,563 $ 5,255

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

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

Quarter Ended Six Months Ended
6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
Loan expense $ 2,880 $ 2,955 $ 2,380 $ 3,130 $ 3,066 $ 5,835 $ 5,604
Amortization of intangibles 27 28 33 34 34 55 223
FDIC assessment expense 4,816 4,509 4,844 3,765 2,550 9,325 4,920
Other real estate expense, net 327 671 (184 ) (40 ) 171 998 343
Other miscellaneous expense 7,189 7,988 8,717 8,150 7,946 15,177 16,850
Total other expense $ 15,239 $ 16,151 $ 15,790 $ 15,039 $ 13,767 $ 31,390 $ 27,940

Note 7 – Non-GAAP Financial Measures

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

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

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

TRUSTMARK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIALS
June 30, 2024
($ in thousands except per share data)
(unaudited)

Note 7 – Non-GAAP Financial Measures (continued)

Quarter Ended Six Months Ended
6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
TANGIBLE EQUITY
AVERAGE BALANCES
Total shareholders' equity $ 1,727,489 $ 1,676,521 $ 1,592,493 $ 1,582,885 $ 1,580,291 $ 1,702,005 $ 1,552,215
Less: Goodwill (334,605 ) (334,605 ) (334,605 ) (334,605 ) (334,605 ) (334,605 ) (334,605 )
Identifiable intangible assets (195 ) (224 ) (253 ) (287 ) (320 ) (210 ) (381 )
Total average tangible equity $ 1,392,689 $ 1,341,692 $ 1,257,635 $ 1,247,993 $ 1,245,366 $ 1,367,190 $ 1,217,229
PERIOD END BALANCES
Total shareholders' equity $ 1,879,141 $ 1,682,599 $ 1,661,847 $ 1,570,351 $ 1,571,193
Less: Goodwill (334,605 ) (334,605 ) (334,605 ) (334,605 ) (334,605 )
Identifiable intangible assets (181 ) (208 ) (236 ) (269 ) (303 )
Total tangible equity (a) $ 1,544,355 $ 1,347,786 $ 1,327,006 $ 1,235,477 $ 1,236,285
TANGIBLE ASSETS
Total assets $ 18,452,487 $ 18,376,612 $ 18,722,189 $ 18,390,839 $ 18,422,626
Less: Goodwill (334,605 ) (334,605 ) (334,605 ) (334,605 ) (334,605 )
Identifiable intangible assets (181 ) (208 ) (236 ) (269 ) (303 )
Total tangible assets (b) $ 18,117,701 $ 18,041,799 $ 18,387,348 $ 18,055,965 $ 18,087,718
Risk-weighted assets (c) $ 15,165,038 $ 15,257,385 $ 15,153,263 $ 15,143,531 $ 14,966,614
NET INCOME (LOSS) ADJUSTED FOR INTANGIBLE AMORTIZATION
Net income (loss) from continuing operations $ (100,605 ) $ 38,173 $ 33,888 $ 30,553 $ 41,204 $ (62,432 ) $ 88,849
Plus: Intangible amortization net of tax from <br>   continuing operations 20 20 25 25 25 40 167
Net income (loss) adjusted for intangible amortization $ (100,585 ) $ 38,193 $ 33,913 $ 30,578 $ 41,229 $ (62,392 ) $ 89,016
Period end common shares outstanding (d) 61,205,969 61,178,366 61,071,173 61,070,095 61,069,036
TANGIBLE COMMON EQUITY MEASUREMENTS
Return on average tangible equity from <br>   continuing operations (1) -29.05 % 11.45 % 10.70 % 9.72 % 13.28 % -9.18 % 14.75 %
Tangible equity/tangible assets (a)/(b) 8.52 % 7.47 % 7.22 % 6.84 % 6.83 %
Tangible equity/risk-weighted assets (a)/(c) 10.18 % 8.83 % 8.76 % 8.16 % 8.26 %
Tangible book value (a)/(d)*1,000 $ 25.23 $ 22.03 $ 21.73 $ 20.23 $ 20.24
COMMON EQUITY TIER 1 CAPITAL (CET1)
Total shareholders' equity $ 1,879,141 $ 1,682,599 $ 1,661,847 $ 1,570,351 $ 1,571,193
CECL transition adjustment 6,500 6,500 13,000 13,000 13,000
AOCI-related adjustments 91,557 227,154 219,723 287,888 265,704
CET1 adjustments and deductions:
Goodwill net of associated deferred <br>   tax liabilities (DTLs) (320,758 ) (370,205 ) (370,212 ) (370,219 ) (370,227 )
Other adjustments and deductions <br>   for CET1 (2) (847 ) (2,588 ) (2,693 ) (2,803 ) (2,915 )
CET1 capital (e) 1,655,593 1,543,460 1,521,665 1,498,217 1,476,755
Additional tier 1 capital instruments <br>   plus related surplus 60,000 60,000 60,000 60,000 60,000
Tier 1 capital $ 1,715,593 $ 1,603,460 $ 1,581,665 $ 1,558,217 $ 1,536,755
Common equity tier 1 capital ratio (e)/(c) 10.92 % 10.12 % 10.04 % 9.89 % 9.87 %
  • Calculation = ((net income (loss) adjusted for intangible amortization/number of days in period)*number of days in year)/total average tangible equity.
  • Includes other intangible assets, net of DTLs, disallowed deferred tax assets (DTAs), threshold deductions and transition adjustments, as applicable.
TRUSTMARK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIALS
June 30, 2024
($ in thousands except per share data)
(unaudited)

Note 7 – Non-GAAP Financial Measures (continued)

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

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

Quarter Ended Six Months Ended
6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
Net interest income (GAAP) (a) $ 141,029 $ 132,830 $ 136,742 $ 138,637 $ 139,904 $ 273,859 $ 277,499
Noninterest income (loss) (GAAP) (141,286 ) 39,355 36,605 36,921 37,829 (101,931 ) 74,907
Add: Loss on sale of 1-4 family mortgage loans (incl in Other, net) 4,798 — — — — 4,798 —
Visa C shares fair value adjustment (incl in Other, net) (8,056 ) — — — — (8,056 ) —
Securities (gains) losses, net 182,792 — — — — 182,792 —
Noninterest income from adjusted continuing<br>   operations (Non-GAAP) (b) $ 38,248 $ 39,355 $ 36,605 $ 36,921 $ 37,829 $ 77,603 $ 74,907
Adjusted pre-provision revenue (a)+(b)=(c) $ 179,277 $ 172,185 $ 173,347 $ 175,558 $ 177,733 $ 351,462 $ 352,406
Noninterest expense (GAAP) $ 118,326 $ 119,664 $ 126,195 $ 130,291 $ 121,621 $ 237,990 $ 239,210
Less: Reduction in force expense (incl in Salaries and employee benefits) — — (1,406 ) — — — —
Litigation settlement expense — — — (6,500 ) — — —
Noninterest expense from adjusted continuing <br>   operations (Non-GAAP) (d) $ 118,326 $ 119,664 $ 124,789 $ 123,791 $ 121,621 $ 237,990 $ 239,210
PPNR (Non-GAAP) (c)-(d) $ 60,951 $ 52,521 $ 48,558 $ 51,767 $ 56,112 $ 113,472 $ 113,196

The following table presents adjustments to net income (loss) from continuing operations and select financial ratios as reported in accordance with GAAP resulting from significant non-routine items occurring during the periods presented:

Quarter Ended Six Months Ended
6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
Net income (loss) (GAAP) from continuing operations $ (100,605 ) $ 38,173 $ 33,888 $ 30,553 $ 41,204 $ (62,432 ) $ 88,849
Significant non-routine transactions (net of taxes):
PCL, LHFI sale of nonperforming 1-4 family 6,475 — — — — 6,475 —
Loss on sale of 1-4 family mortgage loans 3,598 — — — — 3,598 —
Visa C shares fair value adjustment (6,042 ) — — — — (6,042 ) —
Securities gains (losses), net 137,094 — — — — 137,094 —
Reduction in force expense — — 1,055 — — — —
Litigation settlement expense — — — 4,875 — — —
Net income adjusted for significant non-routine <br>   transactions (Non-GAAP) $ 40,520 $ 38,173 $ 34,943 $ 35,428 $ 41,204 $ 78,693 $ 88,849
Diluted EPS from adjusted continuing operations $ 0.66 $ 0.62 $ 0.57 $ 0.58 $ 0.67 $ 1.28 $ 1.45
FINANCIAL RATIOS - REPORTED (GAAP)
Return on average equity from continuing operations -23.42 % 9.16 % 8.44 % 7.66 % 10.46 % -7.38 % 11.54 %
Return on average tangible equity from continuing operations -29.05 % 11.45 % 10.70 % 9.72 % 13.28 % -9.18 % 14.75 %
Return on average assets from continuing operations -2.16 % 0.83 % 0.72 % 0.65 % 0.88 % -0.67 % 0.97 %
FINANCIAL RATIOS - ADJUSTED (NON-GAAP)
Return on average equity from adjusted continuing operations 9.06 % 9.16 % 8.68 % 8.87 % 10.46 % 9.11 % 11.54 %
Return on average tangible equity from adjusted <br>   continuing operations 11.14 % 11.45 % 10.98 % 11.25 % 13.28 % 11.29 % 14.75 %
Return on average assets from adjusted continuing operations 0.87 % 0.83 % 0.74 % 0.75 % 0.88 % 0.85 % 0.97 %
TRUSTMARK CORPORATION AND SUBSIDIARIES
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NOTES TO CONSOLIDATED FINANCIALS
June 30, 2024
($ in thousands)
(unaudited)

Note 7 – Non-GAAP Financial Measures (continued)

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

Quarter Ended Six Months Ended
6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023 6/30/2024 6/30/2023
Total noninterest expense (GAAP) $ 118,326 $ 119,664 $ 126,195 $ 130,291 $ 121,621 $ 237,990 $ 239,210
Less: Other real estate expense, net (327 ) (671 ) 184 40 (171 ) (998 ) (343 )
Amortization of intangibles (27 ) (28 ) (33 ) (34 ) (34 ) (55 ) (223 )
Charitable contributions resulting in <br>   state tax credits (300 ) (300 ) (325 ) (325 ) (325 ) (600 ) (650 )
Reduction in force expense — — (1,406 ) — — — —
Litigation settlement expense — — — (6,500 ) — — —
Adjusted noninterest expense (Non-GAAP) (c) $ 117,672 $ 118,665 $ 124,615 $ 123,472 $ 121,091 $ 236,337 $ 237,994
Net interest income (GAAP) $ 141,029 $ 132,830 $ 136,742 $ 138,637 $ 139,904 $ 273,859 $ 277,499
Add: Tax equivalent adjustment 3,304 3,365 3,306 3,299 3,383 6,669 6,860
Net interest income-FTE (Non-GAAP) (a) $ 144,333 $ 136,195 $ 140,048 $ 141,936 $ 143,287 $ 280,528 $ 284,359
Noninterest income (loss) (GAAP) $ (141,286 ) $ 39,355 $ 36,605 $ 36,921 $ 37,829 $ (101,931 ) $ 74,907
Add: Partnership amortization for tax credit purposes 1,824 1,834 2,013 1,995 2,019 3,658 3,980
Loss on sale of 1-4 family mortgage loans 4,798 — — — — 4,798 —
Securities (gains) losses, net 182,792 — (39 ) — — 182,792 —
Less: Visa C shares fair value adjustment (8,056 ) — — — — (8,056 ) —
Adjusted noninterest income (Non-GAAP) (b) $ 40,072 $ 41,189 $ 38,579 $ 38,916 $ 39,848 $ 81,261 $ 78,887
Adjusted revenue (Non-GAAP) (a)+(b) $ 184,405 $ 177,384 $ 178,627 $ 180,852 $ 183,135 $ 361,789 $ 363,246
Efficiency ratio (Non-GAAP) (c)/((a)+(b)) 63.81 % 66.90 % 69.76 % 68.27 % 66.12 % 65.32 % 65.52 %

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Exhibit 99.2

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(1) (2)

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