TRUSTMARK CORP - FORM 8-K - EX-99.1

Attached files

file	filename
8-K - TRUSTMARK CORPORATION EARNINGS RELEASE - TRUSTMARK CORP	form8k.htm

News Release

Trustmark Corporation Announces 2011 Financial Results

and Declares $0.23 Quarterly Cash Dividend

Jackson, Miss. – January 24, 2012 – Trustmark Corporation (NASDAQ:TRMK) announced net income available to common shareholders of $106.8 million for the year ended December 31, 2011, which represented diluted earnings per common share of $1.66, an increase of 5.7% compared to figures one year earlier. Trustmark’s performance during 2011 produced a return on average tangible common equity of 12.25% and a return on average assets of 1.11%. In the fourth quarter of 2011, Trustmark’s net income available to common shareholders totaled $24.3 million, which represented diluted earnings per common share of $0.38. Trustmark’s Board of Directors declared a quarterly cash dividend of $0.23 per common share payable March 15, 2012, to shareholders of record on March 1, 2012.

Gerard R. Host, President and CEO, stated, “Trustmark achieved strong financial performance in 2011, particularly in light of the current economic and regulatory environments. We experienced significant improvement in credit quality as reflected by a 17.5% reduction in nonperforming assets, a 40.0% reduction in provisioning for loan losses, and a 43.6% reduction in net charge-offs relative to the prior year. We also made additional inroads in building and strengthening customer relationships as our deposit base increased $521.8 million, or 7.4%, to $7.6 billion at year end 2011.

“We remained active on the acquisition front in 2011. In April, we completed an FDIC assisted transaction of a 90 year-old financial institution with $204.3 million in deposits in Carthage, MS. In November, we announced a merger with Bay Bank & Trust Company, a 76 year-old financial institution with assets of $247.0 million in Panama City, FL. We anticipate this transaction will close during the first quarter of 2012.

“Thanks to our dedicated associates, solid profitability and strong capital base, Trustmark remains well-positioned to continue meeting the needs of our customers and take advantage of opportunities to create value for our shareholders.”

Credit Quality

·	Classified and criticized loans declined $30.1 million and $17.9 million, respectively, relative to the prior quarter

·	ORE levels declined $10.5 million from the prior quarter

·	Net charge-offs totaled $6.0 million in the fourth quarter and represented 0.40% of average loans

During the fourth quarter, nonperforming loans, excluding covered loans (loans with FDIC loss share agreements), increased $10.9 million relative to the prior quarter to total $110.5 million, or 1.82% of total loans. This increase is principally attributable to two credits in the Texas market, which are well-secured based upon current appraisals. Nonperforming loans in Trustmark’s Florida market declined to $23.0 million, marking seven consecutive quarters of improvement. Foreclosed other real estate, excluding covered ORE (ORE covered by FDIC loss share agreements), decreased $10.5 million, or 11.8%, from the prior quarter to total $79.1 million. Collectively, nonperforming assets totaled $189.5 million at December 31, 2011. Trustmark continued to make progress in the resolution of nonperforming assets as balances during the last 12 months decreased $40.1 million, or 17.5%, including a $33.2 million reduction in the Florida market.

Net charge-offs during the fourth quarter totaled $6.0 million and represented 0.40% of average loans, excluding covered loans. The provision for loan losses, excluding covered loans, totaled $6.1 million. During the fourth quarter, Trustmark experienced a $30.1 million, or 8.7%, decline in classified loans and a $17.9 million, or 4.3%, decline in criticized loans relative to the prior quarter. Relative to figures one year earlier, classified loan balances decreased $77.3 million, or 19.7%, while criticized loan balances decreased $80.7 million, or 16.8%.

Allocation of Trustmark’s $89.5 million allowance for loan losses, excluding covered loans, represented 1.91% of commercial loans and 0.76% of consumer and home mortgage loans, resulting in an allowance to total loans of 1.53% as of December 31, 2011. The allowance for loan losses represented 194.2% of nonperforming loans, excluding impaired loans. All of these ratios exclude covered loans and covered other real estate.

Trustmark continued to make significant progress in the resolution of its construction and land development portfolio in Florida. During the last 12 months, this portfolio was reduced by 27.7% to total $95.5 million. At December 31, 2011, the associated reserve for loan losses on this portfolio totaled $10.5 million, or 11.0%. Trustmark remains focused on managing credit risks resulting from current economic and real estate market conditions.

Capital Strength

·	Tangible common equity to tangible assets totaled 9.66%

·	Total risk-based capital ratio totaled 16.67%

Consistent profitability of Trustmark’s diversified financial services business, coupled with prudent balance sheet management, continued to be reflected in its solid capital position. At December 31, 2011, tangible common equity totaled $909.9 million and represented 9.66% of tangible assets while the total risk-based capital ratio was 16.67%. Trustmark’s strong capital base provides strategic flexibility to support organic growth as well as acquisition opportunities that strengthen the value of the franchise.

Balance Sheet Management

·	Total loans increased $71.5 million relative to the prior quarter

·	Average earning assets increased to $8.6 billion in the fourth quarter

·	Net interest income (FTE) totaled $92.7 million in the fourth quarter

Loans, including loans held for investment and covered loans, totaled $5.9 billion at December 31, 2011, an increase of $71.5 million from the prior quarter. During the fourth quarter, Trustmark’s commercial and industrial loan portfolio expanded $56.8 million while 1-4 family residential mortgage loans and other loans increased $42.7 million and $21.5 million, respectively. This growth was offset in part by a $22.0 million reduction in indirect auto lending, a $14.5 million decline in nonfarm, nonresidential lending, and a $7.6 million reduction in construction and land development lending.

Average earning assets during the fourth quarter increased $86.3 million, or 1.0%, relative to the prior quarter to total $8.6 billion; growth was attributable to an increase in investment securities and loans. Average deposits decreased $80.5 million, or 1.1%, relative to the prior quarter to total $7.5 billion as growth in noninterest-bearing deposits was more than offset by a seasonal decrease in public funds. Average noninterest-bearing deposits increased 4.7% to represent 25.2% of average deposits in the fourth quarter of 2011.

Prudent asset and liability management, including disciplined loan and deposit pricing, continued to produce solid net interest income and a strong net interest margin. Net interest income (FTE) totaled $92.7 million during the fourth quarter, an increase of $3.4 million from the prior quarter, which resulted in a net interest margin of 4.28%. Net interest income during the fourth quarter included $3.8 million of recovery and accretion resulting from improved cash flows on acquired loans. Excluding this recovery and accretion, the net interest margin was 4.10% during the fourth quarter.

Noninterest Income

·	Noninterest income totaled $159.9 million in 2011 and represented 31.4% of total revenue

·	Tax credit investments reduced the effective tax rate to 24.5% in the fourth quarter

Noninterest income totaled $32.8 million in the fourth quarter, a decrease of $11.5 million from the prior quarter. A significant portion of the decline occurred in other noninterest income and was attributable to a $4.2 million write-down of the FDIC indemnification asset resulting from improved cash flow projections on covered loans as well as an increase in partnership amortization of $1.3 million related to tax credit investments, which reduced the Corporation’s effective tax rate during the quarter by approximately 3.5%. In addition, mortgage banking performance included a reduction in the net hedge ineffectiveness of mortgage servicing rights of $3.1 million while insurance revenue experienced a seasonal reduction of $1.4 million. Collectively, these items reduced noninterest income by approximately $10.0 million.

Trustmark continued to achieve solid financial performance from its diverse financial services businesses. During the fourth quarter, mortgage production exceeded $420 million, a 23.5% increase relative to the prior quarter. Mortgage banking income totaled $6.0 million during the fourth quarter and continued to reflect stable mortgage servicing income and increased secondary marketing gains. Insurance revenue totaled $6.1 million in the fourth quarter while income from wealth management services totaled $5.2 million.

Noninterest Expense

·	Noninterest expense remained well-controlled, increasing 1.3% during 2011

·	ORE/Foreclosure expense declined 50.9% from the prior quarter to $2.8 million

Total noninterest expense in 2011 increased $4.2 million, or 1.3%, relative to the prior year. Salary and employee benefit expense increased $4.0 million, or 2.3%, from the prior year due in part to the purchase of Heritage Banking Group from the FDIC in April 2011. During the fourth quarter of 2011, noninterest expense declined $2.5 million, or 2.9%, from the prior quarter to total $83.0 million, principally due to a $2.9 million reduction in ORE/Foreclosure expense.

Trustmark continued to make prudent investments and reallocate resources to support revenue growth and profitability. During the fourth quarter, Trustmark opened a new mortgage banking office in Birmingham, AL, as well as a new banking center in Starkville, MS. In addition, a new corporate office was opened in Tupelo, MS, consolidating existing retail, commercial and mortgage banking as well as wealth management and insurance services into a convenient location that complements Trustmark’s other Tupelo locations.

ADDITIONAL INFORMATION

As previously announced, Trustmark will conduct a conference call with analysts on Wednesday, January 25, 2012, at 10:00 a.m. Central Time to discuss the Corporation’s financial results. Interested parties may listen to the conference call by dialing (877) 317-6789, passcode 10008303, or by clicking on the link provided under the Investor Relations section of our website at www.trustmark.com. A replay of the conference call will also be available through Thursday, February 2, 2012, in archived format at the same web address or by calling (877) 344-7529, passcode 10008303.

Trustmark is a financial services company providing banking and financial solutions through over 150 offices in Florida, Mississippi, Tennessee and Texas.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this document constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by words such as “may,” “hope,” “will,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential,” “continue,” “could,” “future” or the negative of those terms or other words of similar meaning. You should read statements that contain these words carefully because they discuss our future expectations or state other “forward-looking” information. These forward-looking statements include, but are 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 in this report could have an adverse effect on our business, results of operations and financial condition. Should one or more of these risks materialize, or should any such underlying assumptions prove to be significantly different, actual results may vary significantly from those anticipated, estimated, projected or expected.

Risks that could cause actual results to differ materially from current expectations of Management include, but are not limited to, changes in the level of nonperforming assets and charge-offs, local, state and national economic and market conditions, including the extent and duration of the current volatility in the credit and financial markets, changes in our ability to measure the fair value of assets in our portfolio, material changes in the level and/or volatility of market interest rates, the performance and demand for the products and services we offer, including the level and timing of withdrawals from our deposit accounts, the costs and effects of litigation and of unexpected or adverse outcomes in such litigation, our ability to attract noninterest-bearing deposits and other low-cost funds, competition in loan and deposit pricing, as well as the entry of new competitors into our markets through de novo expansion and acquisitions, economic conditions and monetary and other governmental actions designed to address the level and volatility of interest rates and the volatility of securities, currency and other markets, the enactment of legislation and changes in existing regulations, or enforcement practices, or the adoption of new regulations, changes in accounting standards and practices, including changes in the interpretation of existing standards, that affect our consolidated financial statements, changes in consumer spending, borrowings and savings habits, technological changes, changes in the financial performance or condition of our borrowers, changes in our ability to control expenses, changes in our compensation and benefit plans, greater than expected costs or difficulties related to the integration of acquisitions or new products and lines of business, natural disasters, environmental disasters, acts of war or terrorism and other risks described in our filings with the Securities and Exchange Commission.

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

Trustmark Investor Contacts:

Louis E. Greer

Treasurer and

Principal Financial Officer

601-208-2310

F. Joseph Rein, Jr.

Senior Vice President

601-208-6898

Trustmark Media Contact:

Melanie A. Morgan

Senior Vice President

601-208-2979

TRUSTMARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

December 31, 2011

($ in thousands)

(unaudited)

										Linked Quarter						Year over Year
QUARTERLY AVERAGE BALANCES	12/31/2011			9/30/2011			12/31/2010			$ Change			% Change			$ Change			% Change
Securities AFS-taxable	$	2,241,361		$	2,150,117		$	1,817,996		$	91,244			4.2	%	$	423,365			23.3	%
Securities AFS-nontaxable		164,057			170,714			140,139			(6,657	)		-3.9	%		23,918			17.1	%
Securities HTM-taxable		41,106			52,868			121,278			(11,762	)		-22.2	%		(80,172	)		-66.1	%
Securities HTM-nontaxable		22,664			24,062			33,138			(1,398	)		-5.8	%		(10,474	)		-31.6	%
Total securities		2,469,188			2,397,761			2,112,551			71,427			3.0	%		356,637			16.9	%
Loans (including loans held for sale)		5,999,221			5,985,730			6,199,875			13,491			0.2	%		(200,654	)		-3.2	%
Covered loans		77,934			83,811			-			(5,877	)		-7.0	%		77,934			n/m
Fed funds sold and rev repos		10,516			5,801			10,766			4,715			81.3	%		(250	)		-2.3	%
Other earning assets		34,859			32,327			41,359			2,532			7.8	%		(6,500	)		-15.7	%
Total earning assets		8,591,718			8,505,430			8,364,551			86,288			1.0	%		227,167			2.7	%
Allowance for loan losses		(90,857	)		(88,888	)		(96,559	)		(1,969	)		2.2	%		5,702			-5.9	%
Cash and due from banks		221,278			216,134			207,874			5,144			2.4	%		13,404			6.4	%
Other assets		914,468			939,780			888,666			(25,312	)		-2.7	%		25,802			2.9	%
Total assets	$	9,636,607		$	9,572,456		$	9,364,532		$	64,151			0.7	%	$	272,075			2.9	%

Interest-bearing demand deposits	$	1,511,422		$	1,558,318		$	1,347,252		$	(46,896	)		-3.0	%	$	164,170			12.2	%
Savings deposits		2,067,431			2,133,437			1,794,352			(66,006	)		-3.1	%		273,079			15.2	%
Time deposits less than $100,000		1,212,190			1,232,374			1,235,529			(20,184	)		-1.6	%		(23,339	)		-1.9	%
Time deposits of $100,000 or more		844,565			877,951			932,744			(33,386	)		-3.8	%		(88,179	)		-9.5	%
Total interest-bearing deposits		5,635,608			5,802,080			5,309,877			(166,472	)		-2.9	%		325,731			6.1	%
Fed funds purchased and repos		526,740			462,294			701,978			64,446			13.9	%		(175,238	)		-25.0	%
Short-term borrowings		141,600			85,678			254,442			55,922			65.3	%		(112,842	)		-44.3	%
Long-term FHLB advances		197			2,413			-			(2,216	)		-91.8	%		197			n/m
Subordinated notes		49,833			49,825			49,801			8			0.0	%		32			0.1	%
Junior subordinated debt securities		61,856			61,856			64,546			-			0.0	%		(2,690	)		-4.2	%
Total interest-bearing liabilities		6,415,834			6,464,146			6,380,644			(48,312	)		-0.7	%		35,190			0.6	%
Noninterest-bearing deposits		1,897,398			1,811,472			1,706,089			85,926			4.7	%		191,309			11.2	%
Other liabilities		100,274			85,404			117,741			14,870			17.4	%		(17,467	)		-14.8	%
Total liabilities		8,413,506			8,361,022			8,204,474			52,484			0.6	%		209,032			2.5	%
Shareholders' equity		1,223,101			1,211,434			1,160,058			11,667			1.0	%		63,043			5.4	%
Total liabilities and equity	$	9,636,607		$	9,572,456		$	9,364,532		$	64,151			0.7	%	$	272,075			2.9	%

										Linked Quarter						Year over Year
PERIOD END BALANCES	12/31/2011			9/30/2011			12/31/2010			$ Change			% Change			$ Change			% Change
Cash and due from banks	$	202,625		$	245,132		$	161,544		$	(42,507	)		-17.3	%	$	41,081			25.4	%
Fed funds sold and rev repos		9,258			8,810			11,773			448			5.1	%		(2,515	)		-21.4	%
Securities available for sale		2,468,993			2,476,905			2,177,249			(7,912	)		-0.3	%		291,744			13.4	%
Securities held to maturity		57,705			71,046			140,847			(13,341	)		-18.8	%		(83,142	)		-59.0	%
Loans held for sale (LHFS)		216,553			210,269			153,044			6,284			3.0	%		63,509			41.5	%
Loans held for investment (LHFI), excluding covered loans		5,857,484			5,783,712			6,060,242			73,772			1.3	%		(202,758	)		-3.3	%
Allowance for loan losses		(89,518	)		(89,463	)		(93,510	)		(55	)		0.1	%		3,992			-4.3	%
Net LHFI, excluding covered loans		5,767,966			5,694,249			5,966,732			73,717			1.3	%		(198,766	)		-3.3	%
Covered loans		76,804			79,064			-			(2,260	)		-2.9	%		76,804			n/m
Allowance for loan losses, covered loans		(502	)		-			-			(502	)		n/m			(502	)		n/m
Net covered loans		76,302			79,064			-			(2,762	)		-3.5	%		76,302			n/m
Net LHFI and covered loans		5,844,268			5,773,313			5,966,732			70,955			1.2	%		(122,464	)		-2.1	%
Premises and equipment, net		142,582			141,639			142,289			943			0.7	%		293			0.2	%
Mortgage servicing rights		43,274			43,659			51,151			(385	)		-0.9	%		(7,877	)		-15.4	%
Goodwill		291,104			291,104			291,104			-			0.0	%		-			0.0	%
Identifiable intangible assets		14,076			14,861			16,306			(785	)		-5.3	%		(2,230	)		-13.7	%
Other real estate, excluding covered other real estate		79,053			89,597			86,704			(10,544	)		-11.8	%		(7,651	)		-8.8	%
Covered other real estate		6,331			7,197			-			(866	)		-12.0	%		6,331			n/m
FDIC indemnification asset		28,348			33,436			-			(5,088	)		-15.2	%		28,348			n/m
Other assets		322,837			298,953			355,159			23,884			8.0	%		(32,322	)		-9.1	%
Total assets	$	9,727,007		$	9,705,921		$	9,553,902		$	21,086			0.2	%	$	173,105			1.8	%

Deposits:
Noninterest-bearing	$	2,033,442		$	1,871,040		$	1,636,625		$	162,402			8.7	%	$	396,817			24.2	%
Interest-bearing		5,532,921			5,698,684			5,407,942			(165,763	)		-2.9	%		124,979			2.3	%
Total deposits		7,566,363			7,569,724			7,044,567			(3,361	)		0.0	%		521,796			7.4	%
Fed funds purchased and repos		604,500			576,672			700,138			27,828			4.8	%		(95,638	)		-13.7	%
Short-term borrowings		87,628			98,887			425,343			(11,259	)		-11.4	%		(337,715	)		-79.4	%
Long-term FHLB advances		-			741			-			(741	)		-100.0	%		-			n/m
Subordinated notes		49,839			49,831			49,806			8			0.0	%		33			0.1	%
Junior subordinated debt securities		61,856			61,856			61,856			-			0.0	%		-			0.0	%
Other liabilities		141,784			126,604			122,708			15,180			12.0	%		19,076			15.5	%
Total liabilities		8,511,970			8,484,315			8,404,418			27,655			0.3	%		107,552			1.3	%
Common stock		13,364			13,359			13,318			5			0.0	%		46			0.3	%
Capital surplus		266,026			264,750			256,675			1,276			0.5	%		9,351			3.6	%
Retained earnings		932,526			923,891			890,917			8,635			0.9	%		41,609			4.7	%
Accum other comprehensive
income (loss), net of tax		3,121			19,606			(11,426	)		(16,485	)		-84.1	%		14,547			n/m
Total shareholders' equity		1,215,037			1,221,606			1,149,484			(6,569	)		-0.5	%		65,553			5.7	%
Total liabilities and equity	$	9,727,007		$	9,705,921		$	9,553,902		$	21,086			0.2	%	$	173,105			1.8	%

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

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

December 31, 2011

($ in thousands except per share data)

(unaudited)

	Quarter Ended									Linked Quarter						Year over Year
INCOME STATEMENTS	12/31/2011			9/30/2011			12/31/2010			$ Change			% Change			$ Change			% Change
Interest and fees on loans-FTE	$	82,230		$	79,256		$	82,664		$	2,974			3.8	%	$	(434	)		-0.5	%
Interest on securities-taxable		17,362			18,115			19,076			(753	)		-4.2	%		(1,714	)		-9.0	%
Interest on securities-tax exempt-FTE		2,133			2,155			2,169			(22	)		-1.0	%		(36	)		-1.7	%
Interest on fed funds sold and rev repos		10			5			12			5			100.0	%		(2	)		-16.7	%
Other interest income		327			329			328			(2	)		-0.6	%		(1	)		-0.3	%
Total interest income-FTE		102,062			99,860			104,249			2,202			2.2	%		(2,187	)		-2.1	%
Interest on deposits		7,728			8,911			10,359			(1,183	)		-13.3	%		(2,631	)		-25.4	%
Interest on fed funds pch and repos		195			216			403			(21	)		-9.7	%		(208	)		-51.6	%
Other interest expense		1,418			1,386			1,535			32			2.3	%		(117	)		-7.6	%
Total interest expense		9,341			10,513			12,297			(1,172	)		-11.1	%		(2,956	)		-24.0	%
Net interest income-FTE		92,721			89,347			91,952			3,374			3.8	%		769			0.8	%
Provision for loan losses, excluding covered loans		6,073			7,978			11,794			(1,905	)		-23.9	%		(5,721	)		-48.5	%
Provision for covered loan losses		624			-			-			624			n/m			624			n/m
Net interest income after provision-FTE		86,024			81,369			80,158			4,655			5.7	%		5,866			7.3	%
Service charges on deposit accounts		13,269			13,680			13,493			(411	)		-3.0	%		(224	)		-1.7	%
Insurance commissions		6,076			7,516			6,224			(1,440	)		-19.2	%		(148	)		-2.4	%
Wealth management		5,223			5,993			5,760			(770	)		-12.8	%		(537	)		-9.3	%
Bank card and other fees		7,112			7,033			6,482			79			1.1	%		630			9.7	%
Mortgage banking, net		6,038			9,783			4,502			(3,745	)		-38.3	%		1,536			34.1	%
Other, net		(4,928	)		234			2,070			(5,162	)		n/m			(6,998	)		n/m
Nonint inc-excl sec gains, net		32,790			44,239			38,531			(11,449	)		-25.9	%		(5,741	)		-14.9	%
Security (losses) gains, net		(11	)		33			101			(44	)		n/m			(112	)		n/m
Total noninterest income		32,779			44,272			38,632			(11,493	)		-26.0	%		(5,853	)		-15.2	%
Salaries and employee benefits		45,616			44,701			44,412			915			2.0	%		1,204			2.7	%
Services and fees		11,323			11,485			10,462			(162	)		-1.4	%		861			8.2	%
Net occupancy-premises		5,038			5,093			4,896			(55	)		-1.1	%		142			2.9	%
Equipment expense		5,139			5,038			4,229			101			2.0	%		910			21.5	%
FDIC assessment expense		1,484			1,812			2,942			(328	)		-18.1	%		(1,458	)		-49.6	%
ORE/Foreclosure expense		2,760			5,616			3,310			(2,856	)		-50.9	%		(550	)		-16.6	%
Other expense		11,643			11,736			10,186			(93	)		-0.8	%		1,457			14.3	%
Total noninterest expense		83,003			85,481			80,437			(2,478	)		-2.9	%		2,566			3.2	%
Income before income taxes and tax eq adj		35,800			40,160			38,353			(4,360	)		-10.9	%		(2,553	)		-6.7	%
Tax equivalent adjustment		3,663			3,667			3,400			(4	)		-0.1	%		263			7.7	%
Income before income taxes		32,137			36,493			34,953			(4,356	)		-11.9	%		(2,816	)		-8.1	%
Income taxes		7,879			9,525			9,793			(1,646	)		-17.3	%		(1,914	)		-19.5	%
Net income available to common shareholders	$	24,258		$	26,968		$	25,160		$	(2,710	)		-10.0	%	$	(902	)		-3.6	%


Per common share data
Earnings per share - basic	$	0.38		$	0.42		$	0.39		$	(0.04	)		-9.5	%	$	(0.01	)		-2.6	%

Earnings per share - diluted	$	0.38		$	0.42		$	0.39		$	(0.04	)		-9.5	%	$	(0.01	)		-2.6	%

Dividends per share	$	0.23		$	0.23		$	0.23		$	-			0.0	%	$	-			0.0	%

Weighted average common shares outstanding
Basic		64,122,188			64,119,235			63,892,362

Diluted		64,330,242			64,310,453			64,105,064

Period end common shares outstanding		64,142,498			64,119,235			63,917,591

OTHER FINANCIAL DATA
Return on common equity		7.87	%		8.83	%		8.60	%
Return on average tangible common equity		10.70	%		12.04	%		11.96	%
Return on equity		7.87	%		8.83	%		8.60	%
Return on assets		1.00	%		1.12	%		1.07	%
Interest margin - Yield - FTE		4.71	%		4.66	%		4.94	%
Interest margin - Cost		0.43	%		0.49	%		0.58	%
Net interest margin - FTE		4.28	%		4.17	%		4.36	%
Efficiency ratio		66.13	%		63.99	%		61.65	%
Full-time equivalent employees		2,537			2,542			2,490

COMMON STOCK PERFORMANCE
Market value-Close	$	24.29		$	18.15		$	24.84
Common book value	$	18.94		$	19.05		$	17.98
Tangible common book value	$	14.18		$	14.28		$	13.17

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

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

December 31, 2011

($ in thousands)

(unaudited)

	Quarter Ended									Linked Quarter						Year over Year
NONPERFORMING ASSETS (1)	12/31/2011			9/30/2011			12/31/2010			$ Change			% Change			$ Change			% Change
Nonaccrual loans
Florida	$	23,002		$	27,263		$	53,773		$	(4,261	)		-15.6	%	$	(30,771	)		-57.2	%
Mississippi (2)		46,746			44,825			39,803			1,921			4.3	%		6,943			17.4	%
Tennessee (3)		15,791			14,575			14,703			1,216			8.3	%		1,088			7.4	%
Texas		24,919			12,915			34,644			12,004			92.9	%		(9,725	)		-28.1	%
Total nonaccrual loans		110,458			99,578			142,923			10,880			10.9	%		(32,465	)		-22.7	%
Other real estate
Florida		29,963			29,949			32,370			14			0.0	%		(2,407	)		-7.4	%
Mississippi (2)		19,483			21,027			24,181			(1,544	)		-7.3	%		(4,698	)		-19.4	%
Tennessee (3)		16,879			17,940			16,407			(1,061	)		-5.9	%		472			2.9	%
Texas		12,728			20,681			13,746			(7,953	)		-38.5	%		(1,018	)		-7.4	%
Total other real estate		79,053			89,597			86,704			(10,544	)		-11.8	%		(7,651	)		-8.8	%
Total nonperforming assets	$	189,511		$	189,175		$	229,627		$	336			0.2	%	$	(40,116	)		-17.5	%

LOANS PAST DUE OVER 90 DAYS (4)
LHFI	$	4,230		$	3,166		$	3,608		$	1,064			33.6	%	$	622			17.2	%

LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase)	$	39,379		$	32,956		$	15,777		$	6,423			19.5	%	$	23,602			n/m

	Quarter Ended									Linked Quarter						Year over Year
ALLOWANCE FOR LOAN LOSSES	12/31/2011			9/30/2011			12/31/2010			$ Change			% Change			$ Change			% Change
Beginning Balance	$	89,463		$	86,846		$	94,458		$	2,617			3.0	%	$	(4,995	)		-5.3	%
Provision for loan losses		6,073			7,978			11,794			(1,905	)		-23.9	%		(5,721	)		-48.5	%
Charge-offs		(8,457	)		(8,675	)		(15,883	)		218			-2.5	%		7,426			-46.8	%
Recoveries		2,439			3,314			3,141			(875	)		-26.4	%		(702	)		-22.3	%
Net charge-offs		(6,018	)		(5,361	)		(12,742	)		(657	)		12.3	%		6,724			-52.8	%
Ending Balance	$	89,518		$	89,463		$	93,510		$	55			0.1	%	$	(3,992	)		-4.3	%

PROVISION FOR LOAN LOSSES
Florida	$	4,797		$	3,046		$	7,473		$	1,751			57.5	%	$	(2,676	)		-35.8	%
Mississippi (2)		3,783			3,732			2,673			51			1.4	%		1,110			41.5	%
Tennessee (3)		(885	)		(105	)		910			(780	)		n/m			(1,795	)		n/m
Texas		(1,622	)		1,305			738			(2,927	)		n/m			(2,360	)		n/m
Total provision for loan losses	$	6,073		$	7,978		$	11,794		$	(1,905	)		-23.9	%	$	(5,721	)		-48.5	%

NET CHARGE-OFFS
Florida	$	2,576		$	2,909		$	4,830		$	(333	)		-11.4	%	$	(2,254	)		-46.7	%
Mississippi (2)		2,556			1,988			4,422			568			28.6	%		(1,866	)		-42.2	%
Tennessee (3)		773			499			1,646			274			54.9	%		(873	)		-53.0	%
Texas		113			(35	)		1,844			148			n/m			(1,731	)		-93.9	%
Total net charge-offs	$	6,018		$	5,361		$	12,742		$	657			12.3	%	$	(6,724	)		-52.8	%

CREDIT QUALITY RATIOS (1)
Net charge offs/average loans		0.40	%		0.36	%		0.82	%
Provision for loan losses/average loans		0.40	%		0.53	%		0.75	%
Nonperforming loans/total loans (incl LHFS)		1.82	%		1.66	%		2.30	%
Nonperforming assets/total loans (incl LHFS)		3.12	%		3.16	%		3.70	%
Nonperforming assets/total loans (incl LHFS) +ORE		3.08	%		3.11	%		3.64	%
ALL/total loans (excl LHFS)		1.53	%		1.55	%		1.54	%
ALL-commercial/total commercial loans		1.91	%		1.94	%		1.94	%
ALL-consumer/total consumer and home mortgage loans		0.76	%		0.76	%		0.78	%
ALL/nonperforming loans		81.04	%		89.84	%		65.43	%
ALL/nonperforming loans -
(excl impaired loans)		194.19	%		248.82	%		188.11	%

CAPITAL RATIOS
Total equity/total assets		12.49	%		12.59	%		12.03	%
Common equity/total assets		12.49	%		12.59	%		12.03	%
Tangible common equity/tangible assets		9.66	%		9.74	%		9.11	%
Tangible common equity/risk-weighted assets		13.83	%		14.04	%		12.62	%
Tier 1 leverage ratio		10.43	%		10.38	%		10.14	%
Tier 1 common risk-based capital ratio		13.90	%		13.84	%		12.87	%
Tier 1 risk-based capital ratio		14.81	%		14.76	%		13.77	%
Total risk-based capital ratio		16.67	%		16.78	%		15.77	%

(1) - Excludes Covered Assets (Loans and Other Real Estate)
(2) - Mississippi includes Central and Southern Mississippi Regions
(3) - Tennessee includes Memphis, Tennessee and Northern Mississippi Regions
(4) - Excludes Covered Loans
n/m - percentage changes greater than +/- 100% are considered not meaningful

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

December 31, 2011

($ in thousands )

(unaudited)

	Quarter Ended															Year Ended
AVERAGE BALANCES	12/31/2011			9/30/2011			6/30/2011			3/31/2011			12/31/2010			12/31/2011			12/31/2010
Securities AFS-taxable	$	2,241,361		$	2,150,117		$	2,142,978		$	2,050,502		$	1,817,996		$	2,146,773		$	1,643,995
Securities AFS-nontaxable		164,057			170,714			151,471			144,921			140,139			157,879			117,116
Securities HTM-taxable		41,106			52,868			73,739			97,710			121,278			66,164			151,361
Securities HTM-nontaxable		22,664			24,062			25,797			27,099			33,138			24,891			39,787
Total securities		2,469,188			2,397,761			2,393,985			2,320,232			2,112,551			2,395,707			1,952,259
Loans (including loans held for sale)		5,999,221			5,985,730			6,044,232			6,107,025			6,199,875			6,033,624			6,285,443
Covered loans		77,934			83,811			77,858			-			-			60,180			-
Fed funds sold and rev repos		10,516			5,801			6,807			8,359			10,766			7,871			9,274
Other earning assets		34,859			32,327			32,028			47,851			41,359			36,719			39,954
Total earning assets		8,591,718			8,505,430			8,554,910			8,483,467			8,364,551			8,534,101			8,286,930
Allowance for loan losses		(90,857	)		(88,888	)		(94,771	)		(96,065	)		(96,559	)		(92,621	)		(102,499	)
Cash and due from banks		221,278			216,134			216,483			222,380			207,874			219,058			211,632
Other assets		914,468			939,780			937,503			899,524			888,666			922,905			895,764
Total assets	$	9,636,607		$	9,572,456		$	9,614,125		$	9,509,306		$	9,364,532		$	9,583,443		$	9,291,827

Interest-bearing demand deposits	$	1,511,422		$	1,558,318		$	1,579,894		$	1,465,390		$	1,347,252		$	1,528,963		$	1,322,382
Savings deposits		2,067,431			2,133,437			2,277,220			2,045,874			1,794,352			2,131,057			1,925,159
Time deposits less than $100,000		1,212,190			1,232,374			1,255,496			1,210,219			1,235,529			1,227,588			1,293,544
Time deposits of $100,000 or more		844,565			877,951			904,106			876,975			932,744			875,816			973,062
Total interest-bearing deposits		5,635,608			5,802,080			6,016,716			5,598,458			5,309,877			5,763,424			5,514,147
Fed funds purchased and repos		526,740			462,294			396,618			647,881			701,978			507,925			580,427
Short-term borrowings		141,600			85,678			92,077			254,451			254,442			142,984			209,550
Long-term FHLB advances		197			2,413			2,333			-			-			1,240			22,441
Subordinated notes		49,833			49,825			49,817			49,809			49,801			49,821			49,789
Junior subordinated debt securities		61,856			61,856			61,856			61,856			64,546			61,856			68,703
Total interest-bearing liabilities		6,415,834			6,464,146			6,619,417			6,612,455			6,380,644			6,527,250			6,445,057
Noninterest-bearing deposits		1,897,398			1,811,472			1,714,778			1,620,554			1,706,089			1,761,946			1,602,187
Other liabilities		100,274			85,404			98,154			116,399			117,741			99,974			100,102
Total liabilities		8,413,506			8,361,022			8,432,349			8,349,408			8,204,474			8,389,170			8,147,346
Shareholders' equity		1,223,101			1,211,434			1,181,776			1,159,898			1,160,058			1,194,273			1,144,481
Total liabilities and equity	$	9,636,607		$	9,572,456		$	9,614,125		$	9,509,306		$	9,364,532		$	9,583,443		$	9,291,827


PERIOD END BALANCES	12/31/2011			9/30/2011			6/30/2011			3/31/2011			12/31/2010
Cash and due from banks	$	202,625		$	245,132		$	221,853		$	193,087		$	161,544
Fed funds sold and rev repos		9,258			8,810			4,576			1,726			11,773
Securities available for sale		2,468,993			2,476,905			2,399,042			2,309,704			2,177,249
Securities held to maturity		57,705			71,046			87,923			110,054			140,847
Loans held for sale (LHFS)		216,553			210,269			123,244			112,981			153,044
Loans held for investment (LHFI), excluding covered loans		5,857,484			5,783,712			5,906,316			5,964,089			6,060,242
Allowance for loan losses		(89,518	)		(89,463	)		(86,846	)		(93,398	)		(93,510	)
Net LHFI, excluding covered loans		5,767,966			5,694,249			5,819,470			5,870,691			5,966,732
Covered loans		76,804			79,064			88,558			-			-
Allowance for loan losses, covered loans		(502	)		-			-			-			-
Net covered loans		76,302			79,064			88,558			-			-
Net LHFI and covered loans		5,844,268			5,773,313			5,908,028			5,870,691			5,966,732
Premises and equipment, net		142,582			141,639			140,640			141,524			142,289
Mortgage servicing rights		43,274			43,659			50,111			53,598			51,151
Goodwill		291,104			291,104			291,104			291,104			291,104
Identifiable intangible assets		14,076			14,861			15,651			15,532			16,306
Other real estate, excluding covered other real estate		79,053			89,597			89,999			89,198			86,704
Covered other real estate		6,331			7,197			7,485			-			-
FDIC indemnification asset		28,348			33,436			33,327			-			-
Other assets		322,837			298,953			325,468			325,263			355,159
Total assets	$	9,727,007		$	9,705,921		$	9,698,451		$	9,514,462		$	9,553,902

Deposits:
Noninterest-bearing	$	2,033,442		$	1,871,040		$	1,806,908		$	1,668,104		$	1,636,625
Interest-bearing		5,532,921			5,698,684			5,825,426			5,758,170			5,407,942
Total deposits		7,566,363			7,569,724			7,632,334			7,426,274			7,044,567
Fed funds purchased and repos		604,500			576,672			539,693			550,919			700,138
Short-term borrowings		87,628			98,887			90,156			154,585			425,343
Long-term FHLB advances		-			741			2,794			-			-
Subordinated notes		49,839			49,831			49,823			49,814			49,806
Junior subordinated debt securities		61,856			61,856			61,856			61,856			61,856
Other liabilities		141,784			126,604			129,025			110,785			122,708
Total liabilities		8,511,970			8,484,315			8,505,681			8,354,233			8,404,418
Common stock		13,364			13,359			13,359			13,333			13,318
Capital surplus		266,026			264,750			263,940			260,297			256,675
Retained earnings		932,526			923,891			911,797			898,222			890,917
Accum other comprehensive
income (loss), net of tax		3,121			19,606			3,674			(11,623	)		(11,426	)
Total shareholders' equity		1,215,037			1,221,606			1,192,770			1,160,229			1,149,484
Total liabilities and equity	$	9,727,007		$	9,705,921		$	9,698,451		$	9,514,462		$	9,553,902

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

December 31, 2011

($ in thousands except per share data)

(unaudited)

	Quarter Ended															Year Ended
INCOME STATEMENTS	12/31/2011			9/30/2011			6/30/2011			3/31/2011			12/31/2010			12/31/2011			12/31/2010
Interest and fees on loans-FTE	$	82,230		$	79,256		$	80,202		$	79,116		$	82,664		$	320,804		$	334,527
Interest on securities-taxable		17,362			18,115			20,374			19,992			19,076			75,843			77,078
Interest on securities-tax exempt-FTE		2,133			2,155			2,115			2,128			2,169			8,531			8,580
Interest on fed funds sold and rev repos		10			5			7			8			12			30			36
Other interest income		327			329			333			332			328			1,321			1,409
Total interest income-FTE		102,062			99,860			103,031			101,576			104,249			406,529			421,630
Interest on deposits		7,728			8,911			9,936			9,719			10,359			36,294			48,657
Interest on fed funds pch and repos		195			216			216			338			403			965			1,183
Other interest expense		1,418			1,386			1,420			1,553			1,535			5,777			6,355
Total interest expense		9,341			10,513			11,572			11,610			12,297			43,036			56,195
Net interest income-FTE		92,721			89,347			91,459			89,966			91,952			363,493			365,435
Provision for loan losses, excluding covered loans		6,073			7,978			8,116			7,537			11,794			29,704			49,546
Provision for covered loan losses		624			-			-			-			-			624			-
Net interest income after provision-FTE		86,024			81,369			83,343			82,429			80,158			333,165			315,889
Service charges on deposit accounts		13,269			13,680			12,851			11,907			13,493			51,707			55,183
Insurance commissions		6,076			7,516			6,862			6,512			6,224			26,966			27,691
Wealth management		5,223			5,993			5,760			5,986			5,760			22,962			21,872
Bank card and other fees		7,112			7,033			6,854			6,475			6,482			27,474			25,014
Mortgage banking, net		6,038			9,783			6,269			4,722			4,502			26,812			29,345
Other, net		(4,928	)		234			7,785			762			2,070			3,853			4,493
Nonint inc-excl sec gains, net		32,790			44,239			46,381			36,364			38,531			159,774			163,598
Security (losses) gains, net		(11	)		33			51			7			101			80			2,329
Total noninterest income		32,779			44,272			46,432			36,371			38,632			159,854			165,927
Salaries and employee benefits		45,616			44,701			44,203			44,036			44,412			178,556			174,582
Services and fees		11,323			11,485			10,780			10,270			10,462			43,858			41,949
Net occupancy-premises		5,038			5,093			5,050			5,073			4,896			20,254			19,808
Equipment expense		5,139			5,038			4,856			5,144			4,229			20,177			17,135
FDIC assessment expense		1,484			1,812			1,938			2,750			2,942			7,984			12,161
ORE/Foreclosure expense		2,760			5,616			4,704			3,213			3,310			16,293			24,377
Other expense		11,643			11,736			9,817			9,532			10,186			42,728			35,637
Total noninterest expense		83,003			85,481			81,348			80,018			80,437			329,850			325,649
Income before income taxes and tax eq adj		35,800			40,160			48,427			38,782			38,353			163,169			156,167
Tax equivalent adjustment		3,663			3,667			3,629			3,591			3,400			14,550			13,412
Income before income taxes		32,137			36,493			44,798			35,191			34,953			148,619			142,755
Income taxes		7,879			9,525			13,196			11,178			9,793			41,778			42,119
Net income available to common shareholders	$	24,258		$	26,968		$	31,602		$	24,013		$	25,160		$	106,841		$	100,636

Per common share data
Earnings per share - basic	$	0.38		$	0.42		$	0.49		$	0.38		$	0.39		$	1.67		$	1.58

Earnings per share - diluted	$	0.38		$	0.42		$	0.49		$	0.37		$	0.39		$	1.66		$	1.57

Dividends per share	$	0.23		$	0.23		$	0.23		$	0.23		$	0.23		$	0.92		$	0.92

Weighted average common shares outstanding
Basic		64,122,188			64,119,235			64,072,047			63,950,461			63,892,362			64,066,599			63,849,058

Diluted		64,330,242			64,310,453			64,281,348			64,181,752			64,105,064			64,261,145			64,039,389

Period end common shares outstanding		64,142,498			64,119,235			64,119,235			63,987,064			63,917,591			64,142,498			63,917,591


OTHER FINANCIAL DATA
Return on common equity		7.87	%		8.83	%		10.73	%		8.40	%		8.60	%		8.95	%		8.79	%
Return on average tangible common equity		10.70	%		12.04	%		14.71	%		11.65	%		11.96	%		12.25	%		12.31	%
Return on equity		7.87	%		8.83	%		10.73	%		8.40	%		8.60	%		8.95	%		8.79	%
Return on assets		1.00	%		1.12	%		1.32	%		1.02	%		1.07	%		1.11	%		1.08	%
Interest margin - Yield - FTE		4.71	%		4.66	%		4.83	%		4.86	%		4.94	%		4.76	%		5.09	%
Interest margin - Cost		0.43	%		0.49	%		0.54	%		0.56	%		0.58	%		0.50	%		0.68	%
Net interest margin - FTE		4.28	%		4.17	%		4.29	%		4.30	%		4.36	%		4.26	%		4.41	%
Efficiency ratio		66.13	%		63.99	%		62.39	%		63.34	%		61.65	%		63.95	%		61.56	%
Full-time equivalent employees		2,537			2,542			2,575			2,489			2,490


COMMON STOCK PERFORMANCE
Market value-Close	$	24.29		$	18.15		$	23.41		$	23.42		$	24.84
Common book value	$	18.94		$	19.05		$	18.60		$	18.13		$	17.98
Tangible common book value	$	14.18		$	14.28		$	13.82		$	13.34		$	13.17

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

December 31, 2011

($ in thousands)

(unaudited)

	Quarter Ended
NONPERFORMING ASSETS (1)	12/31/2011			9/30/2011			6/30/2011			3/31/2011			12/31/2010
Nonaccrual loans
Florida	$	23,002		$	27,263		$	30,752		$	44,548		$	53,773
Mississippi (2)		46,746			44,825			47,802			40,226			39,803
Tennessee (3)		15,791			14,575			17,564			13,886			14,703
Texas		24,919			12,915			24,900			28,130			34,644
Total nonaccrual loans		110,458			99,578			121,018			126,790			142,923
Other real estate
Florida		29,963			29,949			33,823			31,339			32,370
Mississippi (2)		19,483			21,027			22,921			22,084			24,181
Tennessee (3)		16,879			17,940			15,760			16,920			16,407
Texas		12,728			20,681			17,495			18,855			13,746
Total other real estate		79,053			89,597			89,999			89,198			86,704
Total nonperforming assets	$	189,511		$	189,175		$	211,017		$	215,988		$	229,627

LOANS PAST DUE OVER 90 DAYS (4)
LHFI	$	4,230		$	3,166		$	6,993		$	5,010		$	3,608

LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase)	$	39,379		$	32,956		$	24,708		$	19,808		$	15,777


	Quarter Ended															Year Ended
ALLOWANCE FOR LOAN LOSSES	12/31/2011			9/30/2011			6/30/2011			3/31/2011			12/31/2010			12/31/2011			12/31/2010
Beginning Balance	$	89,463		$	86,846		$	93,398		$	93,510		$	94,458		$	93,510		$	103,662
Provision for loan losses		6,073			7,978			8,116			7,537			11,794			29,704			49,546
Charge-offs		(8,457	)		(8,675	)		(17,505	)		(11,132	)		(15,883	)		(45,769	)		(71,897	)
Recoveries		2,439			3,314			2,837			3,483			3,141			12,073			12,199
Net charge-offs		(6,018	)		(5,361	)		(14,668	)		(7,649	)		(12,742	)		(33,696	)		(59,698	)
Ending Balance	$	89,518		$	89,463		$	86,846		$	93,398		$	93,510		$	89,518		$	93,510

PROVISION FOR LOAN LOSSES
Florida	$	4,797		$	3,046		$	5,633		$	3,024		$	7,473		$	16,500		$	19,926
Mississippi (2)		3,783			3,732			1,331			1,071			2,673			9,917			14,249
Tennessee (3)		(885	)		(105	)		157			1,619			910			786			5,612
Texas		(1,622	)		1,305			995			1,823			738			2,501			9,759
Total provision for loan losses	$	6,073		$	7,978		$	8,116		$	7,537		$	11,794		$	29,704		$	49,546

NET CHARGE-OFFS
Florida	$	2,576		$	2,909		$	7,880		$	5,478		$	4,830		$	18,843		$	28,650
Mississippi (2)		2,556			1,988			3,401			410			4,422			8,355			18,963
Tennessee (3)		773			499			324			979			1,646			2,575			6,578
Texas		113			(35	)		3,063			782			1,844			3,923			5,507
Total net charge-offs	$	6,018		$	5,361		$	14,668		$	7,649		$	12,742		$	33,696		$	59,698

CREDIT QUALITY RATIOS (1)
Net charge offs/average loans		0.40	%		0.36	%		0.97	%		0.51	%		0.82	%		0.56	%		0.95	%
Provision for loan losses/average loans		0.40	%		0.53	%		0.54	%		0.50	%		0.75	%		0.49	%		0.79	%
Nonperforming loans/total loans (incl LHFS)		1.82	%		1.66	%		2.01	%		2.09	%		2.30	%
Nonperforming assets/total loans (incl LHFS)		3.12	%		3.16	%		3.50	%		3.55	%		3.70	%
Nonperforming assets/total loans (incl LHFS) +ORE		3.08	%		3.11	%		3.45	%		3.50	%		3.64	%
ALL/total loans (excl LHFS)		1.53	%		1.55	%		1.47	%		1.57	%		1.54	%
ALL-commercial/total commercial loans		1.91	%		1.94	%		1.84	%		1.98	%		1.94	%
ALL-consumer/total consumer and home mortgage loans		0.76	%		0.76	%		0.76	%		0.76	%		0.78	%
ALL/nonperforming loans		81.04	%		89.84	%		71.76	%		73.66	%		65.43	%
ALL/nonperforming loans -
(excl impaired loans)		194.19	%		248.82	%		181.95	%		215.40	%		188.11	%

CAPITAL RATIOS
Total equity/total assets		12.49	%		12.59	%		12.30	%		12.19	%		12.03	%
Common equity/total assets		12.49	%		12.59	%		12.30	%		12.19	%		12.03	%
Tangible common equity/tangible assets		9.66	%		9.74	%		9.43	%		9.27	%		9.11	%
Tangible common equity/risk-weighted assets		13.83	%		14.04	%		13.51	%		13.06	%		12.62	%
Tier 1 leverage ratio		10.43	%		10.38	%		10.18	%		10.10	%		10.14	%
Tier 1 common risk-based capital ratio		13.90	%		13.84	%		13.55	%		13.32	%		12.87	%
Tier 1 risk-based capital ratio		14.81	%		14.76	%		14.46	%		14.24	%		13.77	%
Total risk-based capital ratio		16.67	%		16.78	%		16.47	%		16.25	%		15.77	%


(1) - Excludes Covered Assets (Loans and Other Real Estate)
(2) - Mississippi includes Central and Southern Mississippi Regions
(3) - Tennessee includes Memphis, Tennessee and Northern Mississippi Regions
(4) - Excludes Covered Loans

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2011

($ in thousands)

(unaudited)

Note 1 – Business Combinations

On April 15, 2011, the Mississippi Department of Banking and Consumer Finance closed the Heritage Banking Group (Heritage), a 90-year old financial institution headquartered in Carthage, Mississippi, and appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. On the same date, Trustmark National Bank (TNB) entered into a purchase and assumption agreement with the FDIC in which TNB agreed to assume all of the deposits and purchased essentially all of the assets of Heritage. The FDIC and TNB entered into a loss-share transaction on approximately $151.9 million of Heritage assets, which covers substantially all loans and other real estate. Under the loss share agreement, the FDIC will cover 80% of covered loan and other real estate losses incurred. TNB will reimburse the FDIC for 80% of recoveries with respect to losses for which the FDIC paid TNB the 80% reimbursement of covered losses incurred under the loss share agreement. Because of the loss protection provided by the FDIC, the risk characteristics of the Heritage loans and other real estate are significantly different from those assets not covered by this agreement. As a result, Trustmark will refer to loans and other real estate subject to the loss share agreement as “covered” while loans and other real estate that are not subject to the loss share agreement will be referred to as “excluding covered.” The loss share agreement applicable to single family residential mortgage loans and related foreclosed real estate provides for FDIC loss sharing and TNB’s reimbursement to the FDIC for recoveries of covered losses for ten years from the date on which the loss share agreement was entered. The loss share agreement applicable to commercial loans and related foreclosed real estate provide for FDIC loss sharing for five years from the date on which the loss share agreement was entered and TNB’s reimbursement to the FDIC for recoveries of covered losses for an additional three years thereafter.

The assets purchased and liabilities assumed for the Heritage acquisition have been accounted for under the acquisition method of accounting (formerly the purchase method). The assets and liabilities, both tangible and intangible, are recorded at their estimated fair values as of the acquisition date. The fair value amounts are subject to change for up to one year after the closing date as additional information relating to closing date fair values becomes available. The amounts are also subject to adjustments based upon final settlement with the FDIC.

The statement of assets purchased and liabilities assumed in the Heritage acquisition are presented below at their estimated fair values as of the acquisition date of April 15, 2011 ($ in thousands):

Assets
Cash and due from banks	$	50,447
Federal funds sold		1,000
Securities available for sale		6,389
LHFI, excluding covered loans		9,644
Covered loans		97,770
Premises and equipment, net		55
Identifiable intangible assets		902
Covered other real estate		7,485
FDIC indemnification asset		33,333
Other assets		218
Total Assets		207,243

Liabilities
Deposits		204,349
Short-term borrowings		23,157
Other liabilities		730
Total Liabilities		228,236

Net assets acquired at fair value		(20,993	)
Cash received on acquisition		28,449

Bargain purchase gain		7,456
Income taxes		2,852
Bargain purchase gain, net of taxes	$	4,604

The bargain purchase gain represents the net of the estimated fair value of the assets acquired and liabilities assumed and is influenced significantly by the FDIC-assisted transaction process. Under the FDIC-assisted transaction process, only certain assets and liabilities are transferred to the acquirer and, depending on the nature and amount of the acquirer's bid, the FDIC may be required to make a cash payment to the acquirer. The pretax gain of $7.5 million recognized by Trustmark is considered a bargain purchase transaction under FASB ASC Topic 805, “Business Combinations.” The gain was recognized as other noninterest income in Trustmark’s consolidated statements of income for the three months ended June 30, 2011.

During the fourth quarter, Trustmark re-estimated the expected cash flows on the acquired loans of Heritage, as required by FASB ASC 310-30, "Loans and Debt Securities Acquired with Deteriorated Credit Quality." The analysis resulted in improvements in the estimated future cash flows of the acquired loans that remain outstanding as well as lower expected remaining losses on those loans. For acquired loans subject to loss share agreements, improvements in loan values, due to increased expected cash flows, may also reduce the expected loss share receivable from the FDIC. The net result between the quarter’s improved loan values and the lower loss share receivable resulted in a charge during the fourth quarter to Trustmark’s pre-tax net income of $935 thousand and was included in the consolidated statements of income as follows:

·	Net interest income included $3.8 million of recovery and accretion resulting from investment basis recovery on paid off loans and prospective yield adjustments for loan pools with improved cash flows.

·	Provision for covered loan losses included $624 thousand for impairment on the recorded investment on certain pools.

·	Other income included a write-down of the FDIC indemnification asset of $4.2 million on covered loans as a result of loan payoffs and improved cash flow projections and lower loss expectations for loan pools.

In addition, accretable yield increased $9 million due to the re-estimated cash flows on acquired loans. The increase in accretable yield will be recognized as interest income over the remaining average life of the acquired loans, which is estimated to be 19 months. The operations of Heritage are included in Trustmark’s operating results from April 15, 2011, and added total revenues of $13.0 million and net income available to common shareholders of $6.5 million through December 31, 2011.

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2011

($ in thousands)

(unaudited)

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 ($ in thousands):

	12/31/2011		9/30/2011		6/30/2011		3/31/2011		12/31/2010
SECURITIES AVAILABLE FOR SALE
U.S. Government agency obligations
Issued by U.S. Government agencies	$	3	$	5	$	7	$	10	$	12
Issued by U.S. Government sponsored agencies		64,802		61,870		102,940		136,168		122,023
Obligations of states and political subdivisions		202,827		207,781		186,034		161,909		159,637
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA		12,445		14,637		14,990		12,079		12,442
Issued by FNMA and FHLMC		347,932		400,589		413,493		417,022		426,504
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		1,614,965		1,579,698		1,556,676		1,486,872		1,400,816
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		226,019		212,325		124,902		95,644		55,815
Total securities available for sale	$	2,468,993	$	2,476,905	$	2,399,042	$	2,309,704	$	2,177,249

SECURITIES HELD TO MATURITY
Obligations of states and political subdivisions	$	42,619	$	43,246	$	46,931	$	49,129	$	53,246
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA		4,538		5,291		5,547		5,650		6,058
Issued by FNMA and FHLMC		588		753		753		759		763
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		7,749		19,534		32,456		52,272		78,526
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		2,211		2,222		2,236		2,244		2,254
Total securities held to maturity	$	57,705	$	71,046	$	87,923	$	110,054	$	140,847

Management continues to focus on asset quality as one of the strategic goals of the securities portfolio, which is evidenced by the investment of approximately 91% of the portfolio in U.S. Government agency-backed obligations and other AAA rated securities. None of the securities owned by Trustmark are collateralized by assets which are considered sub-prime. Furthermore, outside of membership in the Federal Home Loan Bank of Dallas or the Federal Reserve Bank, Trustmark does not hold any equity investment in government sponsored entities.

Note 3 – Loan Composition

LHFI BY TYPE (excluding covered loans)	12/31/2011			9/30/2011			6/30/2011			3/31/2011			12/31/2010
Loans secured by real estate:
Construction, land development and other land loans	$	474,082		$	481,821		$	510,867		$	552,956		$	583,316
Secured by 1-4 family residential properties		1,760,930			1,717,366			1,737,744			1,737,018			1,732,056
Secured by nonfarm, nonresidential properties		1,425,774			1,437,573			1,457,328			1,488,711			1,498,108
Other real estate secured		204,849			207,984			208,797			216,986			231,963
Commercial and industrial loans		1,139,365			1,083,753			1,082,127			1,082,258			1,068,369
Consumer loans		243,756			268,002			332,032			357,870			402,165
Other loans		608,728			587,213			577,421			528,290			544,265
LHFI, excluding covered loans		5,857,484			5,783,712			5,906,316			5,964,089			6,060,242
Allowance for loan losses		(89,518	)		(89,463	)		(86,846	)		(93,398	)		(93,510	)
Net LHFI, excluding covered loans	$	5,767,966		$	5,694,249		$	5,819,470		$	5,870,691		$	5,966,732


COVERED LOANS BY TYPE	12/31/2011			9/30/2011			6/30/2011			3/31/2011			12/31/2010
Loans secured by real estate:
Construction, land development and other land loans	$	4,209		$	4,024		$	8,477		$	-		$	-
Secured by 1-4 family residential properties		31,874			32,735			32,124			-			-
Secured by nonfarm, nonresidential properties		30,889			33,601			35,846			-			-
Other real estate secured		5,126			5,294			5,363			-			-
Commercial and industrial loans		2,971			1,772			5,570			-			-
Consumer loans		290			158			163			-			-
Other loans		1,445			1,480			1,015			-			-
Covered loans		76,804			79,064			88,558			-			-
Allowance for loan losses, covered loans		(502	)		-			-			-			-
Net covered loans	$	76,302		$	79,064		$	88,558		$	-		$	-

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2011

($ in thousands)

(unaudited)

Note 3 – Loan Composition (continued)
	December 31, 2011
LHFI - COMPOSITION BY REGION (1)	Total		Florida		Mississippi (Central and Southern Regions)		Tennessee (Memphis, TN and Northern MS Regions)		Texas
Loans secured by real estate:
Construction, land development and other land loans	$	474,082	$	95,453	$	232,170	$	31,789	$	114,670
Secured by 1-4 family residential properties		1,760,930		57,773		1,527,499		145,655		30,003
Secured by nonfarm, nonresidential properties		1,425,774		160,409		771,425		171,168		322,772
Other real estate secured		204,849		10,847		146,804		6,648		40,550
Commercial and industrial loans		1,139,365		12,823		800,421		83,290		242,831
Consumer loans		243,756		1,173		216,215		21,478		4,890
Other loans		608,728		27,040		519,764		26,622		35,302
Loans	$	5,857,484	$	365,518	$	4,214,298	$	486,650	$	791,018



CONSTRUCTION, LAND DEVELOPMENT AND OTHER LAND LOANS BY REGION (1)
Lots	$	64,269	$	38,409	$	19,880	$	1,618	$	4,362
Development		115,777		11,542		58,380		6,329		39,526
Unimproved land		169,272		44,085		74,703		18,771		31,713
1-4 family construction		73,566		1,130		57,653		2,495		12,288
Other construction		51,198		287		21,554		2,576		26,781
Construction, land development and other land loans	$	474,082	$	95,453	$	232,170	$	31,789	$	114,670




LOANS SECURED BY NONFARM, NONRESIDENTIAL PROPERTIES BY REGION (1)
Income producing:
Retail	$	158,140	$	41,676	$	61,995	$	23,993	$	30,476
Office		144,019		39,726		75,226		10,815		18,252
Nursing homes/assisted living		114,059		-		104,326		4,421		5,312
Hotel/motel		78,574		10,787		29,567		10,729		27,491
Industrial		39,028		8,957		8,494		276		21,301
Health care		12,722		-		11,513		168		1,041
Convenience stores		9,708		201		4,608		2,610		2,289
Other		156,048		15,545		76,012		11,339		53,152
Total income producing loans		712,298		116,892		371,741		64,351		159,314

Owner-occupied:
Office		112,052		16,114		62,466		7,820		25,652
Churches		90,155		2,106		50,751		32,343		4,955
Industrial warehouses		90,161		2,429		50,415		494		36,823
Health care		98,900		10,664		51,596		16,479		20,161
Convenience stores		61,045		1,476		37,947		4,216		17,406
Retail		33,039		3,904		20,482		1,820		6,833
Restaurants		35,137		618		26,527		6,378		1,614
Auto dealerships		21,944		540		17,742		1,946		1,716
Other		171,043		5,666		81,758		35,321		48,298
Total owner-occupied loans		713,476		43,517		399,684		106,817		163,458

Loans secured by nonfarm, nonresidential properties	$	1,425,774	$	160,409	$	771,425	$	171,168	$	322,772

(1) Excludes covered loans.

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2011

($ in thousands)

(unaudited)

Note 3 – Loan Composition (continued)

	December 31, 2011

								Classified (3)
FLORIDA CREDIT QUALITY	Total Loans			Criticized Loans (1)	Special Mention (2)			Accruing		Nonimpaired Nonaccrual		Impaired Nonaccrual (4)
Construction, land development and other land loans:
Lots	$	38,409	$	13,371	$	934		$	9,484	$	1,755	$	1,198
Development		11,542		2,257		-			-		-		2,257
Unimproved land		44,085		27,011		20,038			2,750		441		3,782
1-4 family construction		1,130		-		-			-		-		-
Other construction		287		287		-			287		-		-
Construction, land development and other land loans		95,453		42,926		20,972			12,521		2,196		7,237
Commercial, commercial real estate and consumer		270,065		58,359		9,857			34,933		2,657		10,912

Total Florida loans	$	365,518	$	101,285	$	30,829		$	47,454	$	4,853	$	18,149


FLORIDA LOAN LOSS RESERVES BY LOAN TYPE	Total Loans		Loan Loss Reserves		Loan Loss Reserve % of Total Loans
Construction, land development and other land loans:
Lots	$	38,409	$	4,209		10.96	%
Development		11,542		1,325		11.48	%
Unimproved land		44,085		4,879		11.07	%
1-4 family construction		1,130		21		1.86	%
Other construction		287		72		25.09	%
Construction, land development and other land loans		95,453		10,506		11.01	%
Commercial, commercial real estate and consumer		270,065		10,811		4.00	%

Total Florida loans	$	365,518	$	21,317		5.83	%

(1)	Criticized loans equal all special mention and classified loans.

(2)	Special mention loans exhibit potential credit weaknesses that, if not resolved, may ultimately result in a more severe classification.

(3)	Classified loans include those loans identified by management as exhibiting well-defined credit weaknesses that may jeopardize repayment in full of the debt.

(4)

All nonaccrual loans over $500 thousand are individually assessed for impairment. Impaired loans have been determined to be collateral dependent and assessed using a fair value approach. Fair value estimates begin with appraised values, normally from recently received and reviewed appraisals. Appraised values are adjusted down for costs associated with asset disposal. At the time a loan is deemed to be impaired, the full difference between book value and the most likely estimate of the asset’s net realizable value is charged off. However, as subsequent events dictate and estimated net realizable values decline, required reserves are established.

LOAN COMPOSITION - FLORIDA	12/31/2011		9/30/2011		6/30/2011		3/31/2011		12/31/2010
Loans secured by real estate:
Construction, land development and other land loans	$	95,453	$	101,450	$	111,131	$	122,445	$	132,021
Secured by 1-4 family residential properties		57,773		62,236		65,532		69,552		72,114
Secured by nonfarm, nonresidential properties		160,409		160,701		174,655		177,943		183,250
Other real estate secured		10,847		11,046		12,852		13,472		14,038
Commercial and industrial loans		12,823		12,670		14,267		14,774		16,053
Consumer loans		1,173		1,241		1,256		1,476		1,487
Other loans		27,040		27,252		27,471		27,694		25,488
Loans	$	365,518	$	376,596	$	407,164	$	427,356	$	444,451



CONSTRUCTION, LAND DEVELOPMENT AND OTHER LAND LOANS - FLORIDA
Lots	$	38,409	$	41,099	$	42,990	$	44,742	$	46,907
Development		11,542		11,885		13,086		20,524		21,144
Unimproved land		44,085		47,303		49,910		52,177		57,811
1-4 family construction		1,130		872		1,130		1,078		2,277
Other construction		287		291		4,015		3,924		3,882
Construction, land development and other land loans	$	95,453	$	101,450	$	111,131	$	122,445	$	132,021

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2011

($ in thousands)

(unaudited)

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															Year Ended
	12/31/2011			9/30/2011			6/30/2011			3/31/2011			12/31/2010			12/31/2011			12/31/2010
Securities – Taxable		3.02	%		3.26	%		3.69	%		3.77	%		3.90	%		3.43	%		4.29	%
Securities – Nontaxable		4.53	%		4.39	%		4.79	%		5.02	%		4.97	%		4.67	%		5.47	%
Securities – Total		3.13	%		3.35	%		3.77	%		3.87	%		3.99	%		3.52	%		4.39	%
Loans		5.37	%		5.18	%		5.25	%		5.25	%		5.29	%		5.26	%		5.32	%
FF Sold & Rev Repo		0.38	%		0.34	%		0.41	%		0.39	%		0.44	%		0.38	%		0.39	%
Other Earning Assets		3.72	%		4.04	%		4.17	%		2.81	%		3.15	%		3.60	%		3.53	%
Total Earning Assets		4.71	%		4.66	%		4.83	%		4.86	%		4.94	%		4.76	%		5.09	%

Interest-bearing Deposits		0.54	%		0.61	%		0.66	%		0.70	%		0.77	%		0.63	%		0.88	%
FF Pch & Repo		0.15	%		0.19	%		0.22	%		0.21	%		0.23	%		0.19	%		0.20	%
Other Borrowings		2.22	%		2.75	%		2.76	%		1.72	%		1.65	%		2.26	%		1.81	%
Total Interest-bearing Liabilities		0.58	%		0.65	%		0.70	%		0.71	%		0.76	%		0.66	%		0.87	%

Net interest margin		4.28	%		4.17	%		4.29	%		4.30	%		4.36	%		4.26	%		4.41	%

As previously mentioned in Note 1 – Business Combinations, the fourth quarter’s net interest income included $3.8 million associated with the re-estimation of cash flows required by FASB ASC 310-30 accounting guidelines. This re-estimation increased the yield on loans and earning assets by 25 basis points and 17 basis points, respectively. Excluding this adjustment, the core net interest margin for the quarter and year ended December 31, 2011, equaled 4.10% and 4.21%, respectively. The decline in the core net interest margin during the fourth quarter is primarily due to the downward repricing of TNB’s fixed rate assets as well as accelerated premium amortization related to the investment portfolio.

Note 5 – Mortgage Banking

Trustmark utilizes a portfolio of exchange-traded derivative instruments, such as Treasury note futures contracts and exchange-traded option contracts, to achieve a fair value return that offsets the changes in fair value of MSR attributable to interest rates. These transactions are considered freestanding derivatives that do not otherwise qualify for hedge accounting. Changes in the fair value of these exchange-traded derivative instruments are recorded in noninterest income in mortgage banking, net and are offset by the changes in the fair value of 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 total hedge cost to the changes in the fair value of the MSR asset attributable to interest rate changes. The impact of this strategy resulted in a net positive ineffectiveness of $4.4 million and $7.3 million for the years ended December 31, 2011 and 2010, respectively.

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

	Quarter Ended															Year Ended
		12/31/2011			9/30/2011		6/30/2011			3/31/2011				12/31/2010			12/31/2011		12/31/2010
Mortgage servicing income, net	$	3,725		$	3,738		$	3,713		$	3,614		$	3,577		$	14,790		$	13,927
Change in fair value-MSR from runoff		(2,122	)		(2,039	)		(1,455	)		(1,291	)		(2,506	)		(6,907	)		(7,305	)
Gain on sales of loans, net		4,633			2,366			1,852			3,101			5,754			11,952			15,317
Other, net		133			2,926			448			(965	)		(2,016	)		2,542			94
Mortgage banking income before hedge ineffectiveness		6,369			6,991			4,558			4,459			4,809			22,377			22,033
Change in fair value-MSR from market changes		(2,842	)		(7,614	)		(4,931	)		257			5,870			(15,130	)		(8,943	)
Change in fair value of derivatives		2,511			10,406			6,642			6			(6,177	)		19,565			16,255
Net (negative) positive hedge ineffectiveness		(331	)		2,792			1,711			263			(307	)		4,435			7,312
Mortgage banking, net	$	6,038		$	9,783		$	6,269		$	4,722		$	4,502		$	26,812		$	29,345

During the first quarter of 2010, Trustmark completed the final settlement of the sale of approximately $920.9 million in mortgages serviced for others, which reduced Trustmark’s MSR by approximately $8.5 million. In addition, during December of 2010, Trustmark purchased approximately $53.9 million of GNMA serviced loans, which were subsequently sold to a third party. Trustmark will retain the servicing for these loans, which are fully guaranteed by FHA/VA. The effect of these transactions did not have a material impact on Trustmark's results of operations.

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2011

($ in thousands)

(unaudited)

Note 6 – Other Noninterest Income

Other noninterest income consisted of the following for the periods presented ($ in thousands):

	Quarter Ended															Year Ended
		12/31/2011			9/30/2011			6/30/2011		3/31/2011				12/31/2010			12/31/2011			12/31/2010
Partnership amortization for tax credit purposes	$	(2,690	)	$	(1,417	)	$	(1,137	)	$	(1,122	)	$	(2,031	)	$	(6,366	)	$	(4,504	)
Bargain purchase gain on acquisition		-			-			7,456			-			-			7,456			-
Decrease in FDIC indemnification asset		(4,157	)		-			-			-			-			(4,157	)		-
Other miscellaneous income		1,919			1,651			1,466			1,884			4,101			6,920			8,997
Total other, net	$	(4,928	)	$	234		$	7,785		$	762		$	2,070		$	3,853		$	4,493

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 or historical tax credits). These investments are recorded based on the equity method of accounting, which requires the equity in partnership losses to be recognized when incurred and are recorded as a reduction in other income. 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.

As previously mentioned in Note 1 – Business Combinations, other income included a write-down of the FDIC indemnification asset of $4.2 million on covered loans as a result of loan payoffs and improved cash flow projections and lower loss expectations for loan pools.

Note 7 – Non-GAAP Financial Measures

In addition to capital ratios defined by generally accepted accounting principles (GAAP) and banking regulators, Trustmark utilizes various tangible common equity measures when evaluating capital utilization and adequacy. Tangible common equity, as defined by Trustmark, represents common equity less goodwill and identifiable intangible assets.

Trustmark believes these measures are important because they reflect the level of capital available to withstand unexpected market conditions. Additionally, presentation of these measures allows readers to compare certain aspects of Trustmark’s capitalization to other organizations. These ratios differ from capital measures defined by banking regulators principally in that the numerator excludes shareholders’ equity associated with preferred securities, the nature and extent of which varies across organizations.

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

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2011

($ in thousands)

(unaudited)

Note 7 - Non-GAAP Financial Measures (continued)
			Quarter Ended															Year Ended
			12/31/2011			9/30/2011			6/30/2011			3/31/2011			12/31/2010			12/31/2011			12/31/2010
TANGIBLE COMMON EQUITY
AVERAGE BALANCES
Total shareholders' common equity			$	1,223,101		$	1,211,434		$	1,181,776		$	1,159,898		$	1,160,058		$	1,194,273		$	1,144,481
Less:	Goodwill			(291,104	)		(291,104	)		(291,104	)		(291,104	)		(291,104	)		(291,104	)		(291,104	)
	Identifiable intangible assets			(14,550	)		(15,343	)		(15,976	)		(16,003	)		(16,835	)		(15,464	)		(18,149	)
Total average tangible common equity			$	917,447		$	904,987		$	874,696		$	852,791		$	852,119		$	887,705		$	835,228

PERIOD END BALANCES
Total shareholders' common equity			$	1,215,037		$	1,221,606		$	1,192,770		$	1,160,229		$	1,149,484
Less:	Goodwill			(291,104	)		(291,104	)		(291,104	)		(291,104	)		(291,104	)
	Identifiable intangible assets			(14,076	)		(14,861	)		(15,651	)		(15,532	)		(16,306	)
Total tangible common equity		(a)	$	909,857		$	915,641		$	886,015		$	853,593		$	842,074

TANGIBLE ASSETS
Total assets			$	9,727,007		$	9,705,291		$	9,698,451		$	9,514,462		$	9,553,902
Less:	Goodwill			(291,104	)		(291,104	)		(291,104	)		(291,104	)		(291,104	)
	Identifiable intangible assets			(14,076	)		(14,861	)		(15,651	)		(15,532	)		(16,306	)
Total tangible assets		(b)	$	9,421,827		$	9,399,326		$	9,391,696		$	9,207,826		$	9,246,492

Risk-weighted assets		(c)	$	6,576,953		$	6,522,468		$	6,556,690		$	6,536,056		$	6,672,174

NET INCOME ADJUSTED FOR INTANGIBLE AMORTIZATION
Net income available to common shareholders			$	24,258		$	26,968		$	31,602		$	24,013		$	25,160		$	106,841		$	100,636
Plus:	Intangible amortization net of tax			493			489			483			480			538			1,945			2,173
Net income adjusted for intangible amortization			$	24,751		$	27,457		$	32,085		$	24,493		$	25,698		$	108,786		$	102,809

Period end common shares outstanding		(d)		64,142,498			64,119,235			64,119,235			63,987,064			63,917,591

TANGIBLE COMMON EQUITY MEASUREMENTS
Return on average tangible common equity 1				10.70	%		12.04	%		14.71	%		11.65	%		11.96	%		12.25	%		12.31	%
Tangible common equity/tangible assets		(a)/(b)		9.66	%		9.74	%		9.43	%		9.27	%		9.11	%
Tangible common equity/risk-weighted assets		(a)/(c)		13.83	%		14.04	%		13.51	%		13.06	%		12.62	%
Tangible common book value		(a)/(d)*1,000	$	14.18		$	14.28		$	13.82		$	13.34		$	13.17

TIER 1 COMMON RISK-BASED CAPITAL
Total shareholders' equity			$	1,215,037		$	1,221,606		$	1,192,770		$	1,160,229		$	1,149,484
Eliminate qualifying AOCI				(3,121	)		(19,606	)		(3,674	)		11,623			11,426
Qualifying tier 1 capital				60,000			60,000			60,000			60,000			60,000
Disallowed goodwill				(291,104	)		(291,104	)		(291,104	)		(291,104	)		(291,104	)
Adj to goodwill allowed for deferred taxes				11,625			11,273			10,920			10,568			10,215
Other disallowed intangibles				(14,076	)		(14,861	)		(15,651	)		(15,532	)		(16,306	)
Disallowed servicing intangible				(4,327	)		(4,366	)		(5,011	)		(5,360	)		(5,115	)
Total tier 1 capital			$	974,034		$	962,942		$	948,250		$	930,424		$	918,600
Less:	Qualifying tier 1 capital			(60,000	)		(60,000	)		(60,000	)		(60,000	)		(60,000	)
Total tier 1 common capital		(e)	$	914,034		$	902,942		$	888,250		$	870,424		$	858,600

Tier 1 common risk-based capital ratio		(e)/(c)		13.90	%		13.84	%		13.55	%		13.32	%		12.87	%

1 Calculation = ((net income adjusted for intangible amortization/number of days in period)*number of days in year)/total average tangible common equity

Attached files

Stock widget

Investing forum

TRUSTMARK CORP Reports