Trustmark Corporation Announces Third Quarter 2022 Financial Results

Rhea-AI Summary

Trustmark Corporation (NASDAQGS: TRMK) reported a net income of $42.5 million for Q3 2022, equating to diluted EPS of $0.69. The bank saw a 5.9% increase in loans held for investment, totaling $11.6 billion, while deposits decreased by 2.3% to $14.4 billion. Total revenue rose 13.7% to $188.7 million, driven by a 20.3% increase in net interest income, resulting in a net interest margin of 3.50%. The quarterly cash dividend was declared at $0.23 per share. Trustmark maintains a strong capital position and continues to invest in technology and branch optimization.

Positive

• Net income reached $42.5 million, with EPS of $0.69.
• Total revenue increased by 13.7% to $188.7 million.
• Loans held for investment rose by 5.9%, up to $11.6 billion.
• Net interest income increased by 20.3%, resulting in a net interest margin of 3.50%.
• Strong capital position with CET1 ratio of 10.63%.

Negative

• Deposits decreased by 2.3% to $14.4 billion.
• Noninterest income fell by $647,000 from the prior quarter.
• Mortgage banking revenue declined by 15.8% year-over-year.

Performance Reflects Continued Loan Growth, Strong Credit Quality, Asset Sensitive Balance Sheet and Diversified Fee Income

JACKSON, Miss.--(BUSINESS WIRE)-- Trustmark Corporation (NASDAQGS: TRMK) reported net income of $42.5 million in the third quarter of 2022, representing diluted earnings per share of $0.69. Trustmark’s Board of Directors declared a quarterly cash dividend of $0.23 per share payable December 15, 2022, to shareholders of record on December 1, 2022.

Printer friendly version of earnings release with consolidated financial statements and notes: https://www.businesswire.com/news/home/52951792/en

Third Quarter Highlights

• Loans held for investment (HFI) increased $641.2 million, or 5.9%, from the prior quarter
• Deposits totaled $14.4 billion, with noninterest-bearing deposits representing 30.2% of total deposits
• Total revenue expanded 13.7% from the prior quarter to $188.7 million
• Net interest income (FTE) increased 20.3% from the prior quarter to $139.1 million, resulting in a 60 basis point expansion in the net interest margin to 3.50%
• Noninterest income totaled $52.6 million, representing 27.9% of total revenue
• Credit quality remained solid; net charge-offs totaled $1.0 million, or 0.03% of average loans

Duane A. Dewey, President and CEO, stated, “Trustmark’s solid financial performance during the third quarter reflected significant loan growth, net interest margin expansion, solid performance in our insurance and wealth management businesses, and strong credit quality. We continued to invest in technology enhancements, rationalize our branch network and add business lines to grow and serve customers. Trustmark is well-positioned to respond to changing economic conditions and create long-term value for our shareholders.”

Balance Sheet Management

• Loans HFI totaled $11.6 billion, up 5.9% from the prior quarter and 13.9% year-over-year
• Investment securities totaled $3.6 billion, down 4.8% from the prior quarter and up 4.3% year-over-year
• Deposits totaled $14.4 billion, down 2.3% from the prior quarter and 3.3% year-over-year
• Initiated a cash flow hedging program to manage asset sensitivity
• Maintained strong capital position with CET1 ratio of 10.63% and total risk-based capital ratio of 12.85%

Loans HFI totaled $11.6 billion at September 30, 2022, reflecting an increase of $641.2 million, or 5.9%, linked-quarter and $1.4 billion, or 13.9%, year-over-year. The linked-quarter growth was broad-based, reflecting increases in virtually every category. Trustmark’s loan portfolio remains well-diversified by loan type and geography.

Deposits totaled $14.4 billion at September 30, 2022, down $345.0 million, or 2.3%, from the prior quarter and $497.7 million, or 3.3%, year-over-year. Trustmark continues to maintain a strong liquidity position as loans HFI represented 80.3% of total deposits at September 30, 2022. Noninterest-bearing deposits represented 30.2% of total deposits at the end of the third quarter. Interest-bearing deposit costs totaled 0.20% in the third quarter, an increase of 9 basis points from the prior quarter. The total cost of interest-bearing liabilities was 0.31% in the third quarter of 2022, an increase of 14 basis points from the prior quarter.

During the third quarter Trustmark initiated a cash flow hedging program under which interest rate swaps convert floating rate loans to fixed rate. The intent of the program is to manage the natural asset sensitivity of Trustmark’s balance sheet. As of September 30, 2022, notional balances totaled $675.0 million with a weighted average receive fixed rate of 2.98%.

Trustmark repurchased $8.0 million, or approximately 247 thousand of its common shares during the third quarter. During the nine months ended September 30, 2022, Trustmark repurchased $24.6 million, or approximately 789 thousand of its common shares. At September 30, 2022, Trustmark had $75.4 million in remaining authority under its existing stock repurchase program, which expires on December 31, 2022. The repurchase program, which is subject to market conditions and management discretion, will continue to be implemented through open market repurchases or privately negotiated transactions. At September 30, 2022, Trustmark’s tangible equity-to-tangible assets ratio was 6.67% while its total risk-based capital ratio was 12.85%. Tangible book value per share was $18.39 at September 30, 2022, down 6.1% from the prior quarter reflecting a decline in accumulated other comprehensive income due to mark-to-market adjustments on securities available for sale resulting from the increase in market interest rates during the third quarter.

Credit Quality

• Provision for credit losses for loans HFI was $12.9 million, largely driven by reserves related to loan growth and a less positive outlook within the macroeconomic forecasts
• Allowance for credit losses (ACL) represented 466.0% of nonaccrual loans, excluding individually evaluated loans at September 30, 2022

Nonaccrual loans totaled $67.9 million at September 30, 2022, up $5.9 million from the prior quarter and $1.7 million year-over-year. Other real estate totaled $3.0 million, reflecting a $63 thousand decrease from the prior quarter and a decline of $3.2 million year-over-year. Collectively, nonperforming assets totaled $70.9 million at September 30, 2022, reflecting a linked-quarter increase of $5.8 million and a year-over-year decrease of $1.6 million.

The provision for credit losses for loans HFI was $12.9 million in the third quarter. This provisioning was primarily driven by reserves related to loan growth, individually analyzed reserves, and a less positive outlook within the macroeconomic forecasts partially offset by adjustments to the pandemic reserve. The provision for credit losses for off-balance sheet credit exposures was a negative $1.3 million in the third quarter. Collectively, the provision for credit losses totaled $11.6 million in the third quarter compared to $1.1 million in the prior quarter and a negative $3.5 million in the third quarter of 2021.

Allocation of Trustmark’s $115.1 million allowance for credit losses on loans HFI represented 0.93% of commercial loans and 1.20% of consumer and home mortgage loans, resulting in an allowance to total loans HFI of 0.99% at September 30, 2022. Management believes the level of the ACL is commensurate with the credit losses currently expected in the loan portfolio.

Revenue Generation

• Total revenue increased $22.8 million, or 13.7%, linked-quarter
• Net interest income (FTE) expanded $23.5 million, or 20.3%, linked-quarter
• Noninterest income totaled $52.6 million, representing 27.9% of total revenue in the third quarter

Revenue in the third quarter totaled $188.7 million, an increase of $22.8 million, or 13.7%, from the prior quarter and $36.3 million, or 23.8%, from the same quarter in the prior year. The linked-quarter and year-over-year increases were principally due to higher net interest income resulting from increased average earning assets and rising interest rates.

Net interest income (FTE) in the third quarter totaled $139.1 million, resulting in a net interest margin of 3.50%, up 60 basis points from the prior quarter. The expansion of the net interest margin was due to increases in the yields on the loans held for investment and held for sale portfolio and the securities portfolio and was partially offset by costs of interest-bearing deposits, which resulted from the higher interest rate environment.

Noninterest income in the third quarter totaled $52.6 million, a decrease of $647 thousand from the prior quarter and $1.5 million year-over-year. The linked-quarter decline was attributable to lower mortgage banking revenue, bank card and other fees, and wealth management revenue, which were offset by increased service charges on deposit accounts, other, net revenue and insurance commissions. Mortgage loan production in the third quarter totaled $508.3 million, down 25.4% from the prior quarter and 28.3% year-over-year. Mortgage banking revenue totaled $6.9 million in the third quarter, a decrease of $1.3 million from the prior quarter and $7.1 million year-over-year. The linked-quarter decline was principally attributable to lower gains on sales of mortgage loans in the secondary market.

Insurance revenue totaled $13.9 million in the third quarter, up $209 thousand, or 1.5%, linked-quarter and up $1.8 million, or 14.7%, year-over-year due in part to increased property and casualty commissions. Wealth management revenue totaled $8.8 million in the third quarter, a decrease of $324 thousand, or 3.6%, from the prior quarter and $293 thousand, or 3.2%, year-over-year as growth in investment management services was more than offset by lower trust management and brokerage revenue. Service charges on deposit accounts increased $1.1 million, or 10.7%, from the prior quarter and $2.4 million, or 27.0%, year-over-year. Bank card and other fees decreased $862 thousand from the prior quarter and increased $756 thousand year-over-year.

Noninterest Expense

• Noninterest expense totaled $126.7 million in the third quarter, up $2.9 million, or 2.4%, from the prior quarter
• Investments in new Atlanta loan production office (LPO) and establishment of Equipment Finance line of business reflected in increased salary and benefit expense
• Efficiency ratio improves to 64.96%

Noninterest expense in the third quarter was $126.7 million, up $2.9 million, or 2.4%, from the prior quarter. Salaries and employee benefits increased $1.0 million, or 1.4%, linked-quarter due primarily to expansion initiatives including the opening of a LPO in Atlanta as well as the establishment of the Equipment Finance line of business. Total services and fees increased $1.3 million, or 5.1%, linked-quarter due to increased professional fees associated with technology and risk management initiatives. Office occupancy expense increased $503 thousand, or 7.3%, linked-quarter due in part to seasonal increases in utilities and increased rental expense.

FIT2GROW

“Earlier this year, we announced FIT2GROW, a comprehensive program of Focus, Innovation and Transformation designed to enhance Trustmark’s ability to grow and serve customers. As part of this program, we are focusing our community bank efforts on commercial, small business, and consumer lines of business to provide additional expertise for our customers and enhance profitable revenue growth. We have also expanded geographically with the opening of a loan production office in Atlanta, which is focused on Commercial Real Estate, Residential Real Estate, Corporate Banking, and Equipment Finance,” said Dewey.

“Innovation is also a key component of FIT2GROW. In recent years, investments in state-of-the-art technology were made in Trustmark’s insurance, wealth management and mortgage banking areas as well as in human resources and accounting systems. We also made significant upgrades to our mobile banking platform, ITM network and digital marketing programs. Collectively, these investments have positioned Trustmark for growth and efficiency. During the third quarter, we successfully converted to a new core loan system and will be implementing a state-of-the-art loan origination platform during the fourth quarter. Collectively, these investments are designed to provide best-in-class service to customers as well as enhance our productivity and efficiency,” said Dewey.

“We have accelerated efforts to optimize our branch network, reflecting changing customer preferences and the continued migration to mobile and digital channels as announced in the first quarter. To date, eight offices have been closed in 2022, and four additional offices are scheduled to close in the fourth quarter. We will continue to pursue opportunities to redesign workflows and restructure the organization,” said Dewey.

Additional Information

As previously announced, Trustmark will conduct a conference call with analysts on Wednesday, October 26, 2022, at 8:30 a.m. Central Time to discuss the Corporation’s financial results. Interested parties may listen to the conference call by dialing (877) 317-3051 or by clicking on the link provided under the Investor Relations section of our website at www.trustmark.com. A replay of the conference call will also be available through Wednesday, November 9, 2022, in archived format at the same web address or by calling (877) 344-7529, passcode 8003135.

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

Forward-Looking Statements

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

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

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

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2022
($ in thousands)
(unaudited)
													Linked Quarter							Year over Year
QUARTERLY AVERAGE BALANCES	9/30/2022				6/30/2022				9/30/2021				$ Change				% Change			$ Change				% Change
Securities AFS-taxable (1)	$	2,824,254			$	3,094,364			$	2,686,765			$	(270,110	)		-8.7	%		$	137,489			5.1	%
Securities AFS-nontaxable		4,928				5,110				5,159				(182	)		-3.6	%			(231	)		-4.5	%
Securities HTM-taxable (1)		1,140,685				811,599				401,685				329,086			40.5	%			739,000			n/m
Securities HTM-nontaxable		5,057				5,630				8,641				(573	)		-10.2	%			(3,584	)		-41.5	%
Total securities		3,974,924				3,916,703				3,102,250				58,221			1.5	%			872,674			28.1	%
Paycheck protection program loans (PPP)		9,821				17,746				122,176				(7,925	)		-44.7	%			(112,355	)		-92.0	%
Loans (includes loans held for sale)		11,459,551				10,910,178				10,389,826				549,373			5.0	%			1,069,725			10.3	%
Fed funds sold and reverse repurchases		226				110				69				116			n/m				157			n/m
Other earning assets		325,620				1,139,312				2,038,515				(813,692	)		-71.4	%			(1,712,895	)		-84.0	%
Total earning assets		15,770,142				15,984,049				15,652,836				(213,907	)		-1.3	%			117,306			0.7	%
Allowance for credit losses (ACL), loans held for investment (LHFI)		(102,951	)			(99,106	)			(104,857	)			(3,845	)		-3.9	%			1,906			1.8	%
Other assets		1,576,653				1,513,127				1,602,611				63,526			4.2	%			(25,958	)		-1.6	%
Total assets	$	17,243,844			$	17,398,070			$	17,150,590			$	(154,226	)		-0.9	%		$	93,254			0.5	%
Interest-bearing demand deposits	$	4,613,733			$	4,578,235			$	4,224,717			$	35,498			0.8	%		$	389,016			9.2	%
Savings deposits		4,514,579				4,638,849				4,617,683				(124,270	)		-2.7	%			(103,104	)		-2.2	%
Time deposits		1,111,440				1,159,065				1,258,829				(47,625	)		-4.1	%			(147,389	)		-11.7	%
Total interest-bearing deposits		10,239,752				10,376,149				10,101,229				(136,397	)		-1.3	%			138,523			1.4	%
Fed funds purchased and repurchases		249,809				118,753				147,635				131,056			n/m				102,174			69.2	%
Other borrowings		88,697				80,283				109,735				8,414			10.5	%			(21,038	)		-19.2	%
Subordinated notes		123,171				123,116				122,951				55			0.0	%			220			0.2	%
Junior subordinated debt securities		61,856				61,856				61,856				—			0.0	%			—			0.0	%
Total interest-bearing liabilities		10,763,285				10,760,157				10,543,406				3,128			0.0	%			219,879			2.1	%
Noninterest-bearing deposits		4,444,370				4,590,338				4,566,924				(145,968	)		-3.2	%			(122,554	)		-2.7	%
Other liabilities		429,720				439,266				257,956				(9,546	)		-2.2	%			171,764			66.6	%
Total liabilities		15,637,375				15,789,761				15,368,286				(152,386	)		-1.0	%			269,089			1.8	%
Shareholders' equity		1,606,469				1,608,309				1,782,304				(1,840	)		-0.1	%			(175,835	)		-9.9	%
Total liabilities and equity	$	17,243,844			$	17,398,070			$	17,150,590			$	(154,226	)		-0.9	%		$	93,254			0.5	%

(1)	During the second quarter of 2022, Trustmark transferred $343.1 million of securities available for sale to securities held to maturity.
	See Note 1 - Securities Available for Sale and Held to Maturity in the Notes to Consolidated Financials for additional information.
n/m - percentage changes greater than +/- 100% are considered not meaningful
See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2022
($ in thousands)
(unaudited)
													Linked Quarter							Year over Year
PERIOD END BALANCES	9/30/2022				6/30/2022				9/30/2021				$ Change				% Change			$ Change				% Change
Cash and due from banks	$	479,637			$	742,461			$	2,175,058			$	(262,824	)		-35.4	%		$	(1,695,421	)		-77.9	%
Fed funds sold and reverse repurchases		10,098				—				—				10,098			n/m				10,098			n/m
Securities available for sale (1)		2,444,486				2,644,364				3,057,605				(199,878	)		-7.6	%			(613,119	)		-20.1	%
Securities held to maturity (1)		1,156,985				1,137,754				394,905				19,231			1.7	%			762,080			n/m
PPP loans		4,798				12,549				46,486				(7,751	)		-61.8	%			(41,688	)		-89.7	%
Loans held for sale (LHFS)		165,213				190,186				335,339				(24,973	)		-13.1	%			(170,126	)		-50.7	%
Loans held for investment (LHFI)		11,586,064				10,944,840				10,174,899				641,224			5.9	%			1,411,165			13.9	%
ACL LHFI		(115,050	)			(103,140	)			(104,073	)			(11,910	)		-11.5	%			(10,977	)		-10.5	%
Net LHFI		11,471,014				10,841,700				10,070,826				629,314			5.8	%			1,400,188			13.9	%
Premises and equipment, net		210,761				207,914				201,937				2,847			1.4	%			8,824			4.4	%
Mortgage servicing rights		132,615				121,014				84,101				11,601			9.6	%			48,514			57.7	%
Goodwill		384,237				384,237				384,237				—			0.0	%			—			0.0	%
Identifiable intangible assets		3,952				4,264				5,621				(312	)		-7.3	%			(1,669	)		-29.7	%
Other real estate		2,971				3,034				6,213				(63	)		-2.1	%			(3,242	)		-52.2	%
Operating lease right-of-use assets		37,282				34,684				34,689				2,598			7.5	%			2,593			7.5	%
Other assets		686,585				627,349				567,627				59,236			9.4	%			118,958			21.0	%
Total assets	$	17,190,634			$	16,951,510			$	17,364,644			$	239,124			1.4	%		$	(174,010	)		-1.0	%
Deposits:
Noninterest-bearing	$	4,358,805			$	4,509,472			$	4,987,885			$	(150,667	)		-3.3	%		$	(629,080	)		-12.6	%
Interest-bearing		10,066,375				10,260,696				9,934,954				(194,321	)		-1.9	%			131,421			1.3	%
Total deposits		14,425,180				14,770,168				14,922,839				(344,988	)		-2.3	%			(497,659	)		-3.3	%
Fed funds purchased and repurchases		544,068				70,157				146,417				473,911			n/m				397,651			n/m
Other borrowings		223,172				72,553				94,889				150,619			n/m				128,283			n/m
Subordinated notes		123,207				123,152				122,987				55			0.0	%			220			0.2	%
Junior subordinated debt securities		61,856				61,856				61,856				—			0.0	%			—			0.0	%
ACL on off-balance sheet credit exposures		31,623				32,949				32,684				(1,326	)		-4.0	%			(1,061	)		-3.2	%
Operating lease liabilities		39,797				37,108				36,531				2,689			7.2	%			3,266			8.9	%
Other liabilities		232,786				196,871				177,494				35,915			18.2	%			55,292			31.2	%
Total liabilities		15,681,689				15,364,814				15,595,697				316,875			2.1	%			85,992			0.6	%
Common stock		12,700				12,752				13,014				(52	)		-0.4	%			(314	)		-2.4	%
Capital surplus		154,150				160,876				201,837				(6,726	)		-4.2	%			(47,687	)		-23.6	%
Retained earnings		1,648,507				1,620,210				1,573,176				28,297			1.7	%			75,331			4.8	%
Accumulated other comprehensive income (loss), net of tax		(306,412	)			(207,142	)			(19,080	)			(99,270	)		47.9	%			(287,332	)		n/m
Total shareholders' equity		1,508,945				1,586,696				1,768,947				(77,751	)		-4.9	%			(260,002	)		-14.7	%
Total liabilities and equity	$	17,190,634			$	16,951,510			$	17,364,644			$	239,124			1.4	%		$	(174,010	)		-1.0	%

(1)

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

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

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

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2022
($ in thousands except per share data)
(unaudited)
	Quarter Ended												Linked Quarter							Year over Year
INCOME STATEMENTS	9/30/2022				6/30/2022				9/30/2021				$ Change				% Change			$ Change				% Change
Interest and fees on LHFS & LHFI-FTE	$	129,395			$	103,033			$	94,101			$	26,362			25.6	%		$	35,294			37.5	%
Interest and fees on PPP loans		186				184				1,533				2			1.1	%			(1,347	)		-87.9	%
Interest on securities-taxable		16,222				14,561				9,973				1,661			11.4	%			6,249			62.7	%
Interest on securities-tax exempt-FTE		100				107				132				(7	)		-6.5	%			(32	)		-24.2	%
Interest on fed funds sold and reverse repurchases		2				1				—				1			100.0	%			2			n/m
Other interest income		1,493				2,214				949				(721	)		-32.6	%			544			57.3	%
Total interest income-FTE		147,398				120,100				106,688				27,298			22.7	%			40,710			38.2	%
Interest on deposits		5,097				2,774				3,691				2,323			83.7	%			1,406			38.1	%
Interest on fed funds purchased and repurchases		1,225				70				51				1,155			n/m				1,174			n/m
Other interest expense		1,996				1,664				1,733				332			20.0	%			263			15.2	%
Total interest expense		8,318				4,508				5,475				3,810			84.5	%			2,843			51.9	%
Net interest income-FTE		139,080				115,592				101,213				23,488			20.3	%			37,867			37.4	%
Provision for credit losses, LHFI		12,919				2,716				(2,492	)			10,203			n/m				15,411			n/m
Provision for credit losses, off-balance sheet credit exposures		(1,326	)			(1,568	)			(1,049	)			242			15.4	%			(277	)		-26.4	%
Net interest income after provision-FTE		127,487				114,444				104,754				13,043			11.4	%			22,733			21.7	%
Service charges on deposit accounts		11,318				10,226				8,911				1,092			10.7	%			2,407			27.0	%
Bank card and other fees		9,305				10,167				8,549				(862	)		-8.5	%			756			8.8	%
Mortgage banking, net		6,876				8,149				14,004				(1,273	)		-15.6	%			(7,128	)		-50.9	%
Insurance commissions		13,911				13,702				12,133				209			1.5	%			1,778			14.7	%
Wealth management		8,778				9,102				9,071				(324	)		-3.6	%			(293	)		-3.2	%
Other, net		2,418				1,907				1,481				511			26.8	%			937			63.3	%
Total noninterest income		52,606				53,253				54,149				(647	)		-1.2	%			(1,543	)		-2.8	%
Salaries and employee benefits		72,707				71,679				74,623				1,028			1.4	%			(1,916	)		-2.6	%
Services and fees		25,795				24,538				22,306				1,257			5.1	%			3,489			15.6	%
Net occupancy-premises		7,395				6,892				6,854				503			7.3	%			541			7.9	%
Equipment expense		6,072				6,047				5,941				25			0.4	%			131			2.2	%
Other expense		14,729				14,611				19,876				118			0.8	%			(5,147	)		-25.9	%
Total noninterest expense		126,698				123,767				129,600				2,931			2.4	%			(2,902	)		-2.2	%
Income before income taxes and tax eq adj		53,395				43,930				29,303				9,465			21.5	%			24,092			82.2	%
Tax equivalent adjustment		2,975				2,916				2,947				59			2.0	%			28			1.0	%
Income before income taxes		50,420				41,014				26,356				9,406			22.9	%			24,064			91.3	%
Income taxes		7,965				6,730				5,156				1,235			18.4	%			2,809			54.5	%
Net income	$	42,455			$	34,284			$	21,200			$	8,171			23.8	%		$	21,255			n/m
Per share data
Earnings per share - basic	$	0.69			$	0.56			$	0.34			$	0.13			23.2	%		$	0.35			n/m
Earnings per share - diluted	$	0.69			$	0.56			$	0.34			$	0.13			23.2	%		$	0.35			n/m
Dividends per share	$	0.23			$	0.23			$	0.23				—			0.0	%			—			0.0	%
Weighted average shares outstanding
Basic		61,114,804				61,378,226				62,521,684
Diluted		61,318,715				61,546,285				62,730,157
Period end shares outstanding		60,953,864				61,201,123				62,461,832
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, 2022
($ in thousands)
(unaudited)
	Quarter Ended												Linked Quarter							Year over Year
NONPERFORMING ASSETS (1)	9/30/2022				6/30/2022				9/30/2021				$ Change				% Change			$ Change				% Change
Nonaccrual LHFI
Alabama	$	12,710			$	2,698			$	9,223			$	10,012			n/m			$	3,487			37.8	%
Florida		227				233				381				(6	)		-2.6	%			(154	)		-40.4	%
Mississippi (2)		23,517				23,039				22,898				478			2.1	%			619			2.7	%
Tennessee (3)		5,120				9,500				10,356				(4,380	)		-46.1	%			(5,236	)		-50.6	%
Texas		26,353				26,582				23,382				(229	)		-0.9	%			2,971			12.7	%
Total nonaccrual LHFI		67,927				62,052				66,240				5,875			9.5	%			1,687			2.5	%
Other real estate
Alabama		217				84				613				133			n/m				(396	)		-64.6	%
Mississippi (2)		2,754				2,950				5,600				(196	)		-6.6	%			(2,846	)		-50.8	%
Total other real estate		2,971				3,034				6,213				(63	)		-2.1	%			(3,242	)		-52.2	%
Total nonperforming assets	$	70,898			$	65,086			$	72,453			$	5,812			8.9	%		$	(1,555	)		-2.1	%
LOANS PAST DUE OVER 90 DAYS (1)
LHFI	$	1,842			$	1,347			$	625			$	495			36.7	%		$	1,217			n/m
LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase)	$	48,313			$	51,164			$	75,091			$	(2,851	)		-5.6	%		$	(26,778	)		-35.7	%
	Quarter Ended												Linked Quarter							Year over Year
ACL LHFI (1)	9/30/2022				6/30/2022				9/30/2021				$ Change				% Change			$ Change				% Change
Beginning Balance	$	103,140			$	98,734			$	104,032			$	4,406			4.5	%		$	(892	)		-0.9	%
Provision for credit losses, LHFI		12,919				2,716				(2,492	)			10,203			n/m				15,411			n/m
Charge-offs		(2,920	)			(2,277	)			(1,586	)			(643	)		-28.2	%			(1,334	)		-84.1	%
Recoveries		1,911				3,967				4,119				(2,056	)		-51.8	%			(2,208	)		-53.6	%
Net (charge-offs) recoveries		(1,009	)			1,690				2,533				(2,699	)		n/m				(3,542	)		n/m
Ending Balance	$	115,050			$	103,140			$	104,073			$	11,910			11.5	%		$	10,977			10.5	%
NET (CHARGE-OFFS) RECOVERIES (1)
Alabama	$	93			$	1,129			$	247			$	(1,036	)		-91.8	%		$	(154	)		-62.3	%
Florida		(23	)			761				356				(784	)		n/m				(379	)		n/m
Mississippi (2)		(702	)			(266	)			1,436				(436	)		n/m				(2,138	)		n/m
Tennessee (3)		(202	)			31				(8	)			(233	)		n/m				(194	)		n/m
Texas		(175	)			35				502				(210	)		n/m				(677	)		n/m
Total net (charge-offs) recoveries	$	(1,009	)		$	1,690			$	2,533			$	(2,699	)		n/m			$	(3,542	)		n/m
(1) Excludes PPP loans.
(2) Mississippi includes Central and Southern Mississippi Regions.
(3) Tennessee includes Memphis, Tennessee and Northern Mississippi Regions.
n/m - percentage changes greater than +/- 100% are considered not meaningful
See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2022
($ in thousands)
(unaudited)
		Quarter Ended																				Nine Months Ended
AVERAGE BALANCES		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021				9/30/2022				9/30/2021
Securities AFS-taxable (1)		$	2,824,254			$	3,094,364			$	3,245,502			$	3,156,740			$	2,686,765			$	3,053,164			$	2,376,995
Securities AFS-nontaxable			4,928				5,110				5,127				5,143				5,159				5,054				5,174
Securities HTM-taxable (1)			1,140,685				811,599				410,851				364,038				401,685				790,385				443,890
Securities HTM-nontaxable			5,057				5,630				7,327				7,618				8,641				5,996				14,500
Total securities			3,974,924				3,916,703				3,668,807				3,533,539				3,102,250				3,854,599				2,840,559
PPP loans			9,821				17,746				29,009				42,749				122,176				18,788				454,436
Loans (includes loans held for sale)			11,459,551				10,910,178				10,550,712				10,487,679				10,389,826				10,976,809				10,340,960
Fed funds sold and reverse repurchases			226				110				56				58				69				131				86
Other earning assets			325,620				1,139,312				1,811,713				1,839,498				2,038,515				1,086,771				1,820,293
Total earning assets			15,770,142				15,984,049				16,060,297				15,903,523				15,652,836				15,937,098				15,456,334
ACL LHFI			(102,951	)			(99,106	)			(99,390	)			(104,148	)			(104,857	)			(100,495	)			(112,199	)
Other assets			1,576,653				1,513,127				1,550,848				1,570,501				1,602,611				1,546,972				1,608,754
Total assets		$	17,243,844			$	17,398,070			$	17,511,755			$	17,369,876			$	17,150,590			$	17,383,575			$	16,952,889
Interest-bearing demand deposits		$	4,613,733			$	4,578,235			$	4,429,056			$	4,353,599			$	4,224,717			$	4,541,018			$	4,010,188
Savings deposits			4,514,579				4,638,849				4,791,104				4,585,624				4,617,683				4,647,164				4,634,482
Time deposits			1,111,440				1,159,065				1,193,435				1,220,083				1,258,829				1,154,346				1,310,438
Total interest-bearing deposits			10,239,752				10,376,149				10,413,595				10,159,306				10,101,229				10,342,528				9,955,108
Fed funds purchased and repurchases			249,809				118,753				212,006				201,856				147,635				193,661				162,984
Other borrowings			88,697				80,283				91,090				94,328				109,735				86,681				136,077
Subordinated notes			123,171				123,116				123,061				123,007				122,951				123,116				122,908
Junior subordinated debt securities			61,856				61,856				61,856				61,856				61,856				61,856				61,856
Total interest-bearing liabilities			10,763,285				10,760,157				10,901,608				10,640,353				10,543,406				10,807,842				10,438,933
Noninterest-bearing deposits			4,444,370				4,590,338				4,601,108				4,679,951				4,566,924				4,544,698				4,481,662
Other liabilities			429,720				439,266				295,287				291,449				257,956				388,585				258,090
Total liabilities			15,637,375				15,789,761				15,798,003				15,611,753				15,368,286				15,741,125				15,178,685
Shareholders' equity			1,606,469				1,608,309				1,713,752				1,758,123				1,782,304				1,642,450				1,774,204
Total liabilities and equity		$	17,243,844			$	17,398,070			$	17,511,755			$	17,369,876			$	17,150,590			$	17,383,575			$	16,952,889

(1)	During the second quarter of 2022, Trustmark transferred $343.1 million of securities available for sale to securities held to maturity.
	See Note 1 - Securities Available for Sale and Held to Maturity in the Notes to Consolidated Financials for additional information.
See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2022
($ in thousands)
(unaudited)
PERIOD END BALANCES		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021
Cash and due from banks		$	479,637			$	742,461			$	1,917,564			$	2,266,829			$	2,175,058
Fed funds sold and reverse repurchases			10,098				—				—				—				—
Securities available for sale (1)			2,444,486				2,644,364				3,018,246				3,238,877				3,057,605
Securities held to maturity (1)			1,156,985				1,137,754				607,598				342,537				394,905
PPP loans			4,798				12,549				18,579				33,336				46,486
LHFS			165,213				190,186				222,538				275,706				335,339
LHFI			11,586,064				10,944,840				10,397,129				10,247,829				10,174,899
ACL LHFI			(115,050	)			(103,140	)			(98,734	)			(99,457	)			(104,073	)
Net LHFI			11,471,014				10,841,700				10,298,395				10,148,372				10,070,826
Premises and equipment, net			210,761				207,914				207,301				205,644				201,937
Mortgage servicing rights			132,615				121,014				111,050				87,687				84,101
Goodwill			384,237				384,237				384,237				384,237				384,237
Identifiable intangible assets			3,952				4,264				4,591				5,074				5,621
Other real estate			2,971				3,034				3,187				4,557				6,213
Operating lease right-of-use assets			37,282				34,684				34,048				34,603				34,689
Other assets			686,585				627,349				614,217				568,177				567,627
Total assets		$	17,190,634			$	16,951,510			$	17,441,551			$	17,595,636			$	17,364,644
Deposits:
Noninterest-bearing		$	4,358,805			$	4,509,472			$	4,739,102			$	4,771,065			$	4,987,885
Interest-bearing			10,066,375				10,260,696				10,374,190				10,316,095				9,934,954
Total deposits			14,425,180				14,770,168				15,113,292				15,087,160				14,922,839
Fed funds purchased and repurchases			544,068				70,157				170,499				238,577				146,417
Other borrowings			223,172				72,553				84,644				91,025				94,889
Subordinated notes			123,207				123,152				123,097				123,042				122,987
Junior subordinated debt securities			61,856				61,856				61,856				61,856				61,856
ACL on off-balance sheet credit exposures			31,623				32,949				34,517				35,623				32,684
Operating lease liabilities			39,797				37,108				35,912				36,468				36,531
Other liabilities			232,786				196,871				186,352				180,574				177,494
Total liabilities			15,681,689				15,364,814				15,810,169				15,854,325				15,595,697
Common stock			12,700				12,752				12,806				12,845				13,014
Capital surplus			154,150				160,876				167,094				175,913				201,837
Retained earnings			1,648,507				1,620,210				1,600,138				1,585,113				1,573,176
Accumulated other comprehensive income (loss), net of tax			(306,412	)			(207,142	)			(148,656	)			(32,560	)			(19,080	)
Total shareholders' equity			1,508,945				1,586,696				1,631,382				1,741,311				1,768,947
Total liabilities and equity		$	17,190,634			$	16,951,510			$	17,441,551			$	17,595,636			$	17,364,644

(1)	During the second quarter of 2022, Trustmark transferred $343.1 million of securities available for sale to securities held to maturity.
	See Note 1 - Securities Available for Sale and Held to Maturity in the Notes to Consolidated Financials for additional information.
See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2022
($ in thousands except per share data)
(unaudited)
		Quarter Ended																				Nine Months Ended
INCOME STATEMENTS		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021				9/30/2022				9/30/2021
Interest and fees on LHFS & LHFI-FTE		$	129,395			$	103,033			$	93,252			$	94,137			$	94,101			$	325,680			$	281,193
Interest and fees on PPP loans			186				184				168				397				1,533				538				36,329
Interest on securities-taxable			16,222				14,561				12,357				10,796				9,973				43,140				27,902
Interest on securities-tax exempt-FTE			100				107				122				123				132				329				571
Interest on fed funds sold and reverse repurchases			2				1				—				—				—				3				—
Other interest income			1,493				2,214				817				826				949				4,524				1,941
Total interest income-FTE			147,398				120,100				106,716				106,279				106,688				374,214				347,936
Interest on deposits			5,097				2,774				2,760				3,401				3,691				10,631				13,544
Interest on fed funds purchased and repurchases			1,225				70				70				66				51				1,365				166
Other interest expense			1,996				1,664				1,539				1,580				1,733				5,199				5,403
Total interest expense			8,318				4,508				4,369				5,047				5,475				17,195				19,113
Net interest income-FTE			139,080				115,592				102,347				101,232				101,213				357,019				328,823
Provision for credit losses, LHFI			12,919				2,716				(860	)			(4,515	)			(2,492	)			14,775				(16,984	)
Provision for credit losses, off-balance sheet credit exposures			(1,326	)			(1,568	)			(1,106	)			2,939				(1,049	)			(4,000	)			(5,888	)
Net interest income after provision-FTE			127,487				114,444				104,313				102,808				104,754				346,244				351,695
Service charges on deposit accounts			11,318				10,226				9,451				9,366				8,911				30,995				23,880
Bank card and other fees			9,305				10,167				8,442				8,340				8,549				27,914				26,322
Mortgage banking, net			6,876				8,149				9,873				11,609				14,004				24,898				52,141
Insurance commissions			13,911				13,702				14,089				11,716				12,133				41,702				36,795
Wealth management			8,778				9,102				9,054				8,757				9,071				26,934				26,433
Other, net			2,418				1,907				3,206				979				1,481				7,531				5,572
Total noninterest income			52,606				53,253				54,115				50,767				54,149				159,974				171,143
Salaries and employee benefits			72,707				71,679				69,585				68,258				74,623				213,971				215,900
Services and fees			25,795				24,538				24,453				22,904				22,306				74,786				66,559
Net occupancy-premises			7,395				6,892				7,079				6,816				6,854				21,366				20,227
Equipment expense			6,072				6,047				6,061				6,585				5,941				18,180				17,752
Other expense			14,729				14,611				14,341				14,906				19,876				43,681				49,389
Total noninterest expense			126,698				123,767				121,519				119,469				129,600				371,984				369,827
Income before income taxes and tax eq adj			53,395				43,930				36,909				34,106				29,303				134,234				153,011
Tax equivalent adjustment			2,975				2,916				3,003				2,906				2,947				8,894				8,798
Income before income taxes			50,420				41,014				33,906				31,200				26,356				125,340				144,213
Income taxes			7,965				6,730				4,695				4,978				5,156				19,390				23,070
Net income		$	42,455			$	34,284			$	29,211			$	26,222			$	21,200			$	105,950			$	121,143
Per share data
Earnings per share - basic		$	0.69			$	0.56			$	0.47			$	0.42			$	0.34			$	1.73			$	1.92
Earnings per share - diluted		$	0.69			$	0.56			$	0.47			$	0.42			$	0.34			$	1.72			$	1.92
Dividends per share		$	0.23			$	0.23			$	0.23			$	0.23			$	0.23			$	0.69			$	0.69
Weighted average shares outstanding
Basic			61,114,804				61,378,226				61,514,395				62,037,884				62,521,684				61,334,344				63,040,860
Diluted			61,318,715				61,546,285				61,709,797				62,264,983				62,730,157				61,519,685				63,219,987
Period end shares outstanding			60,953,864				61,201,123				61,463,392				61,648,679				62,461,832				60,953,864				62,461,832
See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2022
($ in thousands)
(unaudited)
		Quarter Ended
NONPERFORMING ASSETS (1)		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021
Nonaccrual LHFI
Alabama		$	12,710			$	2,698			$	7,506			$	8,182			$	9,223
Florida			227				233				310				313				381
Mississippi (2)			23,517				23,039				21,318				21,636				22,898
Tennessee (3)			5,120				9,500				9,266				10,501				10,356
Texas			26,353				26,582				25,999				22,066				23,382
Total nonaccrual LHFI			67,927				62,052				64,399				62,698				66,240
Other real estate
Alabama			217				84				—				—				613
Mississippi (2)			2,754				2,950				3,187				4,557				5,600
Total other real estate			2,971				3,034				3,187				4,557				6,213
Total nonperforming assets		$	70,898			$	65,086			$	67,586			$	67,255			$	72,453
LOANS PAST DUE OVER 90 DAYS (1)
LHFI		$	1,842			$	1,347			$	1,503			$	2,114			$	625
LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase)		$	48,313			$	51,164			$	62,078			$	69,894			$	75,091
		Quarter Ended																				Nine Months Ended
ACL LHFI (1)		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021				9/30/2022				9/30/2021
Beginning Balance		$	103,140			$	98,734			$	99,457			$	104,073			$	104,032			$	99,457			$	117,306
Provision for credit losses, LHFI			12,919				2,716				(860	)			(4,515	)			(2,492	)			14,775				(16,984	)
Charge-offs			(2,920	)			(2,277	)			(2,242	)			(2,616	)			(1,586	)			(7,439	)			(7,659	)
Recoveries			1,911				3,967				2,379				2,515				4,119				8,257				11,410
Net (charge-offs) recoveries			(1,009	)			1,690				137				(101	)			2,533				818				3,751
Ending Balance		$	115,050			$	103,140			$	98,734			$	99,457			$	104,073			$	115,050			$	104,073
NET (CHARGE-OFFS) RECOVERIES (1)
Alabama		$	93			$	1,129			$	699			$	747			$	247			$	1,921			$	552
Florida			(23	)			761				(26	)			(32	)			356				712				553
Mississippi (2)			(702	)			(266	)			(88	)			(683	)			1,436				(1,056	)			572
Tennessee (3)			(202	)			31				(424	)			(130	)			(8	)			(595	)			1,070
Texas			(175	)			35				(24	)			(3	)			502				(164	)			1,004
Total net (charge-offs) recoveries		$	(1,009	)		$	1,690			$	137			$	(101	)		$	2,533			$	818			$	3,751
(1) Excludes PPP loans.
(2) Mississippi includes Central and Southern Mississippi Regions.
(3) Tennessee includes Memphis, Tennessee and Northern Mississippi Regions.
See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL INFORMATION
September 30, 2022
(unaudited)
		Quarter Ended																				Nine Months Ended
FINANCIAL RATIOS AND OTHER DATA		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021				9/30/2022			9/30/2021
Return on average equity			10.48	%			8.55	%			6.91	%			5.92	%			4.72	%		8.62	%		9.13	%
Return on average tangible equity			13.90	%			11.36	%			9.05	%			7.72	%			6.16	%		11.39	%		11.84	%
Return on average assets			0.98	%			0.79	%			0.68	%			0.60	%			0.49	%		0.81	%		0.96	%
Interest margin - Yield - FTE			3.71	%			3.01	%			2.69	%			2.65	%			2.70	%		3.14	%		3.01	%
Interest margin - Cost			0.21	%			0.11	%			0.11	%			0.13	%			0.14	%		0.14	%		0.17	%
Net interest margin - FTE			3.50	%			2.90	%			2.58	%			2.53	%			2.57	%		3.00	%		2.84	%
Efficiency ratio (1)			64.96	%			71.89	%			76.44	%			76.52	%			74.10	%		70.70	%		69.85	%
Full-time equivalent employees			2,717				2,727				2,725				2,692				2,680
CREDIT QUALITY RATIOS (2)
Net (recoveries) charge-offs / average loans			0.03	%			-0.06	%			-0.01	%			0.00	%			-0.10	%		-0.01	%		-0.05	%
Provision for credit losses, LHFI / average loans			0.45	%			0.10	%			-0.03	%			-0.17	%			-0.10	%		0.18	%		-0.22	%
Nonaccrual LHFI / (LHFI + LHFS)			0.58	%			0.56	%			0.61	%			0.60	%			0.63	%
Nonperforming assets / (LHFI + LHFS)			0.60	%			0.58	%			0.64	%			0.64	%			0.69	%
Nonperforming assets / (LHFI + LHFS + other real estate)			0.60	%			0.58	%			0.64	%			0.64	%			0.69	%
ACL LHFI / LHFI			0.99	%			0.94	%			0.95	%			0.97	%			1.02	%
ACL LHFI-commercial / commercial LHFI			0.93	%			0.88	%			0.95	%			1.00	%			1.05	%
ACL LHFI-consumer / consumer and home mortgage LHFI			1.20	%			1.14	%			0.96	%			0.87	%			0.91	%
ACL LHFI / nonaccrual LHFI			169.37	%			166.22	%			153.32	%			158.63	%			157.11	%
ACL LHFI / nonaccrual LHFI (excl individually evaluated loans)			466.03	%			475.27	%			484.01	%			500.85	%			520.77	%
CAPITAL RATIOS
Total equity / total assets			8.78	%			9.36	%			9.35	%			9.90	%			10.19	%
Tangible equity / tangible assets			6.67	%			7.23	%			7.29	%			7.86	%			8.12	%
Tangible equity / risk-weighted assets			8.15	%			9.16	%			9.79	%			10.71	%			11.19	%
Tier 1 leverage ratio			9.01	%			8.80	%			8.66	%			8.73	%			8.92	%
Common equity tier 1 capital ratio			10.63	%			11.01	%			11.23	%			11.29	%			11.68	%
Tier 1 risk-based capital ratio			11.06	%			11.47	%			11.70	%			11.77	%			12.17	%
Total risk-based capital ratio			12.85	%			13.26	%			13.53	%			13.55	%			14.01	%
STOCK PERFORMANCE
Market value-Close		$	30.63			$	29.19			$	30.39			$	32.46			$	32.22
Book value		$	24.76			$	25.93			$	26.54			$	28.25			$	28.32
Tangible book value		$	18.39			$	19.58			$	20.22			$	21.93			$	22.08

(1)	See Note 6 – Non-GAAP Financial Measures in the Notes to Consolidated Financials for Trustmark’s efficiency ratio calculation.
(2)	Excludes PPP loans.
See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIALS
September 30, 2022
($ in thousands)
(unaudited)

Note 1 - Securities Available for Sale and Held to Maturity

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

		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021
SECURITIES AVAILABLE FOR SALE
U.S. Treasury securities		$	416,278			$	419,696			$	361,822			$	344,640			$	278,615
U.S. Government agency obligations			9,116				11,947				12,623				13,727				14,979
Obligations of states and political subdivisions			4,763				5,179				5,359				5,714				5,734
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA			28,164				32,240				35,117				39,573				43,860
Issued by FNMA and FHLMC			1,718,057				1,888,546				2,038,331				2,218,429				2,187,412
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA			126,138				144,158				164,506				196,690				236,885
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA			141,970				142,598				400,488				420,104				290,120
Total securities available for sale		$	2,444,486			$	2,644,364			$	3,018,246			$	3,238,877			$	3,057,605
SECURITIES HELD TO MATURITY
Obligations of states and political subdivisions		$	4,512			$	5,320			$	7,324			$	7,328			$	10,683
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA			4,527				4,624				4,831				5,005				5,912
Issued by FNMA and FHLMC			179,375				185,554				192,373				43,444				48,554
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA			197,923				210,479				224,012				241,934				264,638
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA			770,648				731,777				179,058				44,826				65,118
Total securities held to maturity		$	1,156,985			$	1,137,754			$	607,598			$	342,537			$	394,905

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

At September 30, 2022, the net unamortized, unrealized loss included in accumulated other comprehensive income (loss) in the accompanying balance sheet for securities held to maturity transferred from securities available for sale totaled approximately $37.7 million ($28.3 million, net of tax).

Management continues to focus on asset quality as one of the strategic goals of the securities portfolio, which is evidenced by the investment of 99.8% of the portfolio in GSE-backed obligations and other Aaa rated securities as determined by Moody’s. None of the securities owned by Trustmark are collateralized by assets which are considered sub-prime. Furthermore, outside of stock ownership in the Federal Home Loan Bank of Dallas, Federal Home Loan Bank of Atlanta and Federal Reserve Bank, Trustmark does not hold any other equity investment in a GSE.

Note 2 – Loan Composition

LHFI consisted of the following during the periods presented:

LHFI BY TYPE		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021
Loans secured by real estate:
Construction, land development and other land loans		$	1,647,395			$	1,440,058			$	1,273,959			$	1,308,781			$	1,286,613
Secured by 1-4 family residential properties			2,597,112				2,424,962				2,106,998				1,977,993				1,891,292
Secured by nonfarm, nonresidential properties			3,206,946				3,178,079				2,975,039				2,977,084				2,924,953
Other real estate secured			593,119				555,311				715,939				726,043				986,163
Commercial and industrial loans			1,689,532				1,551,001				1,495,060				1,414,279				1,327,211
Consumer loans			163,412				160,716				154,215				159,472				157,963
State and other political subdivision loans			1,188,703				1,110,795				1,215,023				1,146,251				1,125,186
Other loans			499,845				523,918				460,896				537,926				475,518
LHFI			11,586,064				10,944,840				10,397,129				10,247,829				10,174,899
ACL LHFI			(115,050	)			(103,140	)			(98,734	)			(99,457	)			(104,073	)
Net LHFI		$	11,471,014			$	10,841,700			$	10,298,395			$	10,148,372			$	10,070,826

TRUSTMARK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIALS
September 30, 2022
($ in thousands)
(unaudited)

Note 2 – Loan Composition (continued)

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

		September 30, 2022
LHFI - COMPOSITION BY REGION		Total				Alabama				Florida				Mississippi (Central and Southern Regions)				Tennessee (Memphis, TN and Northern MS Regions)				Texas
Loans secured by real estate:
Construction, land development and other land loans		$	1,647,395			$	768,582			$	57,901			$	419,470			$	38,356			$	363,086
Secured by 1-4 family residential properties			2,597,112				126,847				48,428				2,320,799				71,330				29,708
Secured by nonfarm, nonresidential properties			3,206,946				911,567				249,549				1,292,254				173,434				580,142
Other real estate secured			593,119				101,680				1,758				337,458				7,036				145,187
Commercial and industrial loans			1,689,532				420,001				25,879				743,116				260,939				239,597
Consumer loans			163,412				23,660				7,595				101,340				19,355				11,462
State and other political subdivision loans			1,188,703				77,853				70,293				831,431				28,879				180,247
Other loans			499,845				69,925				10,096				305,372				54,077				60,375
Loans		$	11,586,064			$	2,500,115			$	471,499			$	6,351,240			$	653,406			$	1,609,804
CONSTRUCTION, LAND DEVELOPMENT AND OTHER LAND LOANS BY REGION
Lots		$	72,411			$	40,195			$	8,822			$	16,441			$	1,937			$	5,016
Development			144,989				51,404				1,690				54,266				6,604				31,025
Unimproved land			99,197				21,327				13,174				32,514				4,707				27,475
1-4 family construction			377,144				201,230				25,079				89,429				25,099				36,307
Other construction			953,654				454,426				9,136				226,820				9				263,263
Construction, land development and other land loans		$	1,647,395			$	768,582			$	57,901			$	419,470			$	38,356			$	363,086
LOANS SECURED BY NONFARM, NONRESIDENTIAL PROPERTIES BY REGION
Non-owner occupied:
Retail		$	324,948			$	122,602			$	34,912			$	85,101			$	22,155			$	60,178
Office			269,068				102,266				18,027				86,812				10,604				51,359
Hotel/motel			298,266				171,299				73,974				24,721				28,272				—
Mini-storage			159,898				27,253				2,150				110,838				500				19,157
Industrial			344,013				116,897				18,636				106,635				247				101,598
Health care			50,239				17,864				1,017				27,427				347				3,584
Convenience stores			29,170				8,706				668				15,019				604				4,173
Nursing homes/senior living			346,795				139,263				—				139,029				5,765				62,738
Other			122,999				17,496				9,979				60,027				16,596				18,901
Total non-owner occupied loans			1,945,396				723,646				159,363				655,609				85,090				321,688
Owner-occupied:
Office			152,004				42,342				37,200				45,750				9,316				17,396
Churches			75,039				16,676				5,348				42,353				7,577				3,085
Industrial warehouses			167,154				18,112				2,920				38,509				17,408				90,205
Health care			126,382				11,077				6,491				91,939				2,360				14,515
Convenience stores			153,282				12,891				21,626				68,967				398				49,400
Retail			95,058				11,993				8,780				43,985				19,373				10,927
Restaurants			53,409				3,098				4,732				29,428				12,293				3,858
Auto dealerships			50,838				7,290				235				24,924				18,389				—
Nursing homes/senior living			252,203				50,363				—				175,640				—				26,200
Other			136,181				14,079				2,854				75,150				1,230				42,868
Total owner-occupied loans			1,261,550				187,921				90,186				636,645				88,344				258,454
Loans secured by nonfarm, nonresidential properties		$	3,206,946			$	911,567			$	249,549			$	1,292,254			$	173,434			$	580,142

TRUSTMARK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIALS
September 30, 2022
($ in thousands)
(unaudited)

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

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

		Quarter Ended																				Nine Months Ended
		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021				9/30/2022				9/30/2021
Securities – taxable			1.62	%			1.50	%			1.37	%			1.22	%			1.28	%			1.50	%			1.32	%
Securities – nontaxable			3.97	%			4.00	%			3.97	%			3.82	%			3.79	%			3.98	%			3.88	%
Securities – total			1.63	%			1.50	%			1.38	%			1.23	%			1.29	%			1.51	%			1.34	%
PPP loans			7.51	%			4.16	%			2.35	%			3.68	%			4.98	%			3.83	%			10.69	%
Loans - LHFI & LHFS			4.48	%			3.79	%			3.58	%			3.56	%			3.59	%			3.97	%			3.64	%
Loans - total			4.48	%			3.79	%			3.58	%			3.56	%			3.61	%			3.97	%			3.93	%
Fed funds sold & reverse repurchases			3.51	%			3.65	%			—				—				—				3.06	%			—
Other earning assets			1.82	%			0.78	%			0.18	%			0.18	%			0.18	%			0.56	%			0.14	%
Total earning assets			3.71	%			3.01	%			2.69	%			2.65	%			2.70	%			3.14	%			3.01	%
Interest-bearing deposits			0.20	%			0.11	%			0.11	%			0.13	%			0.14	%			0.14	%			0.18	%
Fed funds purchased & repurchases			1.95	%			0.24	%			0.13	%			0.13	%			0.14	%			0.94	%			0.14	%
Other borrowings			2.89	%			2.52	%			2.26	%			2.25	%			2.33	%			2.56	%			2.25	%
Total interest-bearing liabilities			0.31	%			0.17	%			0.16	%			0.19	%			0.21	%			0.21	%			0.24	%
Net interest margin			3.50	%			2.90	%			2.58	%			2.53	%			2.57	%			3.00	%			2.84	%
Net interest margin excluding PPP loans and the FRB balance			3.53	%			3.06	%			2.88	%			2.82	%			2.90	%			3.17	%			2.94	%

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

At September 30, 2022 and June 30, 2022, the average FRB balance totaled $275.4 million and $1.077 billion, respectively, and is included in other earning assets in the accompanying average consolidated balance sheets.

The net interest margin excluding PPP loans and the FRB balance totaled 3.53% for the third quarter of 2022, an increase of 47 basis points when compared to the second quarter of 2022. The expansion of the net interest margin excluding PPP loans and the FRB balance was due to increases in the yields on the loans held for investment and held for sale portfolio and the securities portfolio and was partially offset by costs of interest-bearing deposits, which resulted from the higher interest-rate environment.

Note 4 – Mortgage Banking

Trustmark utilizes a portfolio of exchange-traded derivative instruments, such as Treasury note futures contracts and option contracts, to achieve a fair value return that offsets the changes in fair value of mortgage servicing rights (MSR) attributable to interest rates. These transactions are considered freestanding derivatives that do not otherwise qualify for hedge accounting under generally accepted accounting principles (GAAP). Changes in the fair value of these exchange-traded derivative instruments, including administrative costs, are recorded in noninterest income in mortgage banking, net and are offset by the changes in the fair value of the MSR. The MSR fair value represents the present value of future cash flows, which among other things includes decay and the effect of changes in interest rates. Ineffectiveness of hedging the MSR fair value is measured by comparing the change in value of hedge instruments to the change in the fair value of the MSR asset attributable to changes in interest rates and other market driven changes in valuation inputs and assumptions. The impact of this strategy resulted in a net negative ineffectiveness of $928 thousand during the third quarter of 2022.

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

		Quarter Ended																				Nine Months Ended
		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021				9/30/2022				9/30/2021
Mortgage servicing income, net		$	6,669			$	6,557			$	6,429			$	6,571			$	6,406			$	19,655			$	18,905
Change in fair value-MSR from runoff			(3,462	)			(3,806	)			(3,785	)			(4,745	)			(5,283	)			(11,053	)			(15,415	)
Gain on sales of loans, net			4,597				6,030				6,223				9,005				12,737				16,850				46,971
Mortgage banking income before hedge ineffectiveness			7,804				8,781				8,867				10,831				13,860				25,452				50,461
Change in fair value-MSR from market changes			10,770				8,739				22,020				2,221				1,806				41,529				11,037
Change in fair value of derivatives			(11,698	)			(9,371	)			(21,014	)			(1,443	)			(1,662	)			(42,083	)			(9,357	)
Net positive (negative) hedge ineffectiveness			(928	)			(632	)			1,006				778				144				(554	)			1,680
Mortgage banking, net		$	6,876			$	8,149			$	9,873			$	11,609			$	14,004			$	24,898			$	52,141

TRUSTMARK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIALS
September 30, 2022
($ in thousands)
(unaudited)

Note 5 – Other Noninterest Income and Expense

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

		Quarter Ended																				Nine Months Ended
		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021				9/30/2022				9/30/2021
Partnership amortization for tax credit purposes		$	(1,531	)		$	(1,475	)		$	(1,336	)		$	(2,455	)		$	(2,045	)		$	(4,342	)		$	(5,556	)
Increase in life insurance cash surrender value			1,676				1,683				1,627				1,675				1,663				4,986				4,955
Other miscellaneous income			2,273				1,699				2,915				1,759				1,863				6,887				6,173
Total other, net		$	2,418			$	1,907			$	3,206			$	979			$	1,481			$	7,531			$	5,572

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																				Nine Months Ended
		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021				9/30/2022				9/30/2021
Loan expense		$	3,858			$	4,068			$	4,389			$	3,221			$	4,022			$	12,315			$	11,927
Amortization of intangibles			312				328				482				548				549				1,122				1,768
FDIC assessment expense			1,945				1,810				1,500				1,475				1,275				5,255				4,040
Regulatory settlement charge			—				—				—				—				5,000				—				5,000
Other real estate expense, net			497				623				35				336				1,357				1,155				3,192
Other miscellaneous expense			8,117				7,782				7,935				9,326				7,673				23,834				23,462
Total other expense		$	14,729			$	14,611			$	14,341			$	14,906			$	19,876			$	43,681			$	49,389

Note 6 – Non-GAAP Financial Measures

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

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

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

TRUSTMARK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIALS
September 30, 2022
($ in thousands except per share data)
(unaudited)

Note 6 – Non-GAAP Financial Measures (continued)

				Quarter Ended																				Nine Months Ended
				9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021				9/30/2022				9/30/2021
TANGIBLE EQUITY
AVERAGE BALANCES
Total shareholders' equity				$	1,606,469			$	1,608,309			$	1,713,752			$	1,758,123			$	1,782,304			$	1,642,450			$	1,774,204
Less: Goodwill					(384,237	)			(384,237	)			(384,237	)			(384,237	)			(384,237	)			(384,237	)			(384,540	)
Identifiable intangible assets					(4,131	)			(4,436	)			(4,879	)			(5,382	)			(5,899	)			(4,479	)			(6,482	)
Total average tangible equity				$	1,218,101			$	1,219,636			$	1,324,636			$	1,368,504			$	1,392,168			$	1,253,734			$	1,383,182
PERIOD END BALANCES
Total shareholders' equity				$	1,508,945			$	1,586,696			$	1,631,382			$	1,741,311			$	1,768,947
Less: Goodwill					(384,237	)			(384,237	)			(384,237	)			(384,237	)			(384,237	)
Identifiable intangible assets					(3,952	)			(4,264	)			(4,591	)			(5,074	)			(5,621	)
Total tangible equity		(a)		$	1,120,756			$	1,198,195			$	1,242,554			$	1,352,000			$	1,379,089
TANGIBLE ASSETS
Total assets				$	17,190,634			$	16,951,510			$	17,441,551			$	17,595,636			$	17,364,644
Less: Goodwill					(384,237	)			(384,237	)			(384,237	)			(384,237	)			(384,237	)
Identifiable intangible assets					(3,952	)			(4,264	)			(4,591	)			(5,074	)			(5,621	)
Total tangible assets		(b)		$	16,802,445			$	16,563,009			$	17,052,723			$	17,206,325			$	16,974,786
Risk-weighted assets		(c)		$	13,748,819			$	13,076,981			$	12,691,545			$	12,623,630			$	12,324,254
NET INCOME ADJUSTED FOR INTANGIBLE AMORTIZATION
Net income				$	42,455			$	34,284			$	29,211			$	26,222			$	21,200			$	105,950			$	121,143
Plus: Intangible amortization net of tax					234				246				362				411				412				842				1,327
Net income adjusted for intangible amortization				$	42,689			$	34,530			$	29,573			$	26,633			$	21,612			$	106,792			$	122,470
Period end common shares outstanding		(d)			60,953,864				61,201,123				61,463,392				61,648,679				62,461,832
TANGIBLE COMMON EQUITY MEASUREMENTS
Return on average tangible equity (1)					13.90	%			11.36	%			9.05	%			7.72	%			6.16	%			11.39	%			11.84	%
Tangible equity/tangible assets		(a)/(b)			6.67	%			7.23	%			7.29	%			7.86	%			8.12	%
Tangible equity/risk-weighted assets		(a)/(c)			8.15	%			9.16	%			9.79	%			10.71	%			11.19	%
Tangible book value		(a)/(d)*1,000		$	18.39			$	19.58			$	20.22			$	21.93			$	22.08
COMMON EQUITY TIER 1 CAPITAL (CET1)
Total shareholders' equity				$	1,508,945			$	1,586,696			$	1,631,382			$	1,741,311			$	1,768,947
CECL transition adjustment					19,500				19,500				19,500				26,000				26,419
AOCI-related adjustments					306,412				207,142				148,656				32,560				19,080
CET1 adjustments and deductions:
Goodwill net of associated deferred tax liabilities (DTLs)					(370,217	)			(370,229	)			(370,240	)			(370,252	)			(370,264	)
Other adjustments and deductions for CET1 (2)					(3,506	)			(3,757	)			(4,015	)			(4,392	)			(4,817	)
CET1 capital		(e)			1,461,134				1,439,352				1,425,283				1,425,227				1,439,365
Additional tier 1 capital instruments plus related surplus					60,000				60,000				60,000				60,000				60,000
Tier 1 capital				$	1,521,134			$	1,499,352			$	1,485,283			$	1,485,227			$	1,499,365
Common equity tier 1 capital ratio		(e)/(c)			10.63	%			11.01	%			11.23	%			11.29	%			11.68	%

(1)	Calculation = ((net income adjusted for intangible amortization/number of days in period)*number of days in year)/total average tangible equity.
(2)	Includes other intangible assets, net of DTLs, disallowed deferred tax assets (DTAs), threshold deductions and transition adjustments, as applicable.

TRUSTMARK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIALS
September 30, 2022
($ in thousands)
(unaudited)

Note 6 – Non-GAAP Financial Measures (continued)

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

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

		Quarter Ended																				Nine Months Ended
		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021				9/30/2022				9/30/2021
Net interest income (GAAP)		$	136,105			$	112,676			$	99,344			$	98,326			$	98,266			$	348,125			$	320,025
Noninterest income (GAAP)			52,606				53,253				54,115				50,767				54,149				159,974				171,143
Pre-provision revenue	(a)	$	188,711			$	165,929			$	153,459			$	149,093			$	152,415			$	508,099			$	491,168
Noninterest expense (GAAP)		$	126,698			$	123,767			$	121,519			$	119,469			$	129,600			$	371,984			$	369,827
Less: Voluntary early retirement program			—				—				—				—				(5,700	)			—				(5,700	)
Regulatory settlement charge			—				—				—				—				(5,000	)			—				(5,000	)
Adjusted noninterest expense - PPNR (Non-GAAP)	(b)	$	126,698			$	123,767			$	121,519			$	119,469			$	118,900			$	371,984			$	359,127
PPNR (Non-GAAP)	(a)-(b)	$	62,013			$	42,162			$	31,940			$	29,624			$	33,515			$	136,115			$	132,041

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

		Quarter Ended																		Nine Months Ended
		9/30/2022									9/30/2021									9/30/2022									9/30/2021
		Amount				Diluted EPS					Amount				Diluted EPS					Amount				Diluted EPS					Amount				Diluted EPS
Net income (GAAP)		$	42,455			$	0.69				$	21,200			$	0.34				$	105,950			$	1.72				$	121,143			$	1.92
Significant non-routine transactions (net of taxes):
Voluntary early retirement program			—				—					4,275				0.07					—				—					4,275				0.07
Regulatory settlement charge (not tax deductible)			—				—					5,000				0.08					—				—					5,000				0.08
Net income adjusted for significant non-routine transactions (Non-GAAP)		$	42,455			$	0.69				$	30,475			$	0.49				$	105,950			$	1.72				$	130,418			$	2.07
		Reported (GAAP)				Adjusted (Non-GAAP)					Reported (GAAP)				Adjusted (Non-GAAP)					Reported (GAAP)				Adjusted (Non-GAAP)					Reported (GAAP)				Adjusted (Non-GAAP)
Return on average equity			10.48	%		n/a						4.72	%			6.77	%				8.62	%		n/a						9.13	%			9.82	%
Return on average tangible equity			13.90	%		n/a						6.16	%			8.77	%				11.39	%		n/a						11.84	%			12.72	%
Return on average assets			0.98	%		n/a						0.49	%			0.71	%				0.81	%		n/a						0.96	%			1.03	%
n/a - not applicable

TRUSTMARK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIALS
September 30, 2022
($ in thousands)
(unaudited)

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

		Quarter Ended																				Nine Months Ended
		9/30/2022				6/30/2022				3/31/2022				12/31/2021				9/30/2021				9/30/2022				9/30/2021
Total noninterest expense (GAAP)		$	126,698			$	123,767			$	121,519			$	119,469			$	129,600			$	371,984			$	369,827
Less: Other real estate expense, net			(497	)			(623	)			(35	)			(336	)			(1,357	)			(1,155	)			(3,192	)
Amortization of intangibles			(312	)			(328	)			(482	)			(548	)			(549	)			(1,122	)			(1,768	)
Charitable contributions resulting in state tax credits			(375	)			(375	)			(375	)			(391	)			(350	)			(1,125	)			(1,055	)
Voluntary early retirement program			—				—				—				—				(5,700	)			—				(5,700	)
Regulatory settlement charge			—				—				—				—				(5,000	)			—				(5,000	)
Adjusted noninterest expense (Non-GAAP)	(c)	$	125,514			$	122,441			$	120,627			$	118,194			$	116,644			$	368,582			$	353,112
Net interest income (GAAP)		$	136,105			$	112,676			$	99,344			$	98,326			$	98,266			$	348,125			$	320,025
Add:Tax equivalent adjustment			2,975				2,916				3,003				2,906				2,947				8,894				8,798
Net interest income-FTE (Non-GAAP)	(a)	$	139,080			$	115,592			$	102,347			$	101,232			$	101,213			$	357,019			$	328,823
Noninterest income (GAAP)		$	52,606			$	53,253			$	54,115			$	50,767			$	54,149			$	159,974			$	171,143
Add:Partnership amortization for tax credit purposes			1,531				1,475				1,336				2,455				2,045				4,342				5,556
Adjusted noninterest income (Non-GAAP)	(b)	$	54,137			$	54,728			$	55,451			$	53,222			$	56,194			$	164,316			$	176,699
Adjusted revenue (Non-GAAP)	(a)+(b)	$	193,217			$	170,320			$	157,798			$	154,454			$	157,407			$	521,335			$	505,522
Efficiency ratio (Non-GAAP)	(c)/((a)+(b))		64.96	%			71.89	%			76.44	%			76.52	%			74.10	%			70.70	%			69.85	%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20221025005326/en/

Trustmark Investor Contacts:

Thomas C. Owens

Treasurer and Principal Financial Officer

601-208-7853

F. Joseph Rein, Jr.

Senior Vice President

601-208-6898

Trustmark Media Contact:

Melanie A. Morgan

Senior Vice President

601-208-2979

Source: Trustmark Corporation

FAQ

What were Trustmark's earnings for Q3 2022?

Trustmark reported a net income of $42.5 million for Q3 2022.

What is the current dividend per share of TRMK?

The quarterly cash dividend is $0.23 per share, payable on December 15, 2022.

How much did Trustmark's loans increase in Q3 2022?

Loans held for investment increased by 5.9% to $11.6 billion.

What was the net interest margin for Trustmark in Q3 2022?

The net interest margin was 3.50%, up 60 basis points from the prior quarter.

What challenges did Trustmark face in its recent earnings report?

Trustmark experienced a decrease in deposits and a decline in mortgage banking revenue.