TRUSTMARK CORP - FORM 8-K - EX-99.1

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8-K - TRUSTMARK CORP - FORM 8-K - TRUSTMARK CORP	form8k.htm

Exhibit 99.1

News Release

Trustmark Corporation Announces 2015 Financial Results

JACKSON, Miss. – January 26, 2016 – Trustmark Corporation (NASDAQ:TRMK) reported net income of $27.9 million in the fourth quarter of 2015, which represented diluted earnings per share of $0.41. For the full year, Trustmark’s net income totaled $116.0 million, which represented diluted earnings per share of $1.71, and produced a return on average tangible equity of 11.36% and a return on average assets of 0.95%. Trustmark’s Board of Directors declared a quarterly cash dividend of $0.23 per share payable March 15, 2016, to shareholders of record on March 1, 2016.

Fourth Quarter Highlights

●	Loans held for investment increased $299.7 million, or 4.4%, from the prior quarter and $641.9 million, or 10.0%, from the comparable period one year earlier
●	Credit quality remained solid; nonperforming assets declined 8.7% and 22.9% from the prior quarter and year-over-year, respectively
●	Net interest income (FTE) excluding acquired loans in the fourth quarter totaled $92.2 million, up 2.4% from the prior quarter and 3.0% year-over-year
●	Routine noninterest expense, which excludes ORE and intangible amortization, totaled $97.2 million, down 1.0% and 1.9% from the prior quarter and year-over-year, respectively

Gerard R. Host, President and CEO, stated, “We made significant achievements in 2015. Throughout the year, we realigned the expense base and reallocated cost savings into areas such as technology, including enhanced performance measurements systems and myTrustmark℠, our new consumer mobile banking service. We also continued to invest in higher-growth markets via new banking centers and loan production offices, while also retaining additional relationship managers. The initial results of these investments are evident in this past year’s results, but ultimately we anticipate their impact to be greater over time. As we look forward in 2016, we will continue to manage the franchise for the long term by expanding and building sustainable relationships, an ideal that has worked for the past 126 years. Thanks to our associates, solid profitability and strong capital base, Trustmark remains well-positioned to continue meeting the needs of our customers and creating long-term value for our shareholders.”

Balance Sheet Management

●	Loans held for investment expanded $641.9 million, or 10.0%, in 2015
●	Average noninterest-bearing deposits in 2015 increased 2.6% and represented 28.9% of average total deposits
●	Solid capital base provides flexibility to support additional growth

Loans held for investment totaled $7.1 billion at December 31, 2015, an increase of 4.4% from the prior quarter and 10.0% from the same period one year earlier. Compared to the prior quarter, loans secured by nonfarm, nonresidential real estate expanded $132.0 million, resulting from growth in Texas, Alabama, Mississippi and Florida. Commercial and industrial loans increased $72.9 million as growth in Texas, Tennessee and Alabama, more than offset declines in Mississippi and Florida. Loans to state and other political subdivisions increased $57.1 million, led principally by growth in Mississippi and Texas. Construction, land development and other land loans expanded $39.3 million, driven primarily by growth in construction loans.

Acquired loans totaled $390.4 million at December 31, 2015, down $28.8 million from the prior quarter. Collectively, loans held for investment and acquired loans totaled $7.5 billion at December 31, 2015, up $271.0 million, or 3.8%, from the prior quarter.

Deposits totaled $9.6 billion at December 31, 2015, an increase of $175.8 million from the prior quarter. Trustmark continues to maintain an attractive, low-cost deposit base with approximately 60% of deposits in checking accounts and a total cost of deposits of 0.13%. The favorable mix of interest-bearing liabilities yielded a total cost of funds of 0.26% for the fourth quarter of 2015.

Trustmark’s capital position remained solid, reflecting the consistent profitability of its diversified financial services businesses. At December 31, 2015, Trustmark’s tangible equity to tangible assets ratio was 8.79%, while its total risk-based capital ratio was 14.07%. Tangible book value per share was $15.98 at December 31, 2015, up 5.6% year-over-year.

Credit Quality

●	Solid improvement in criticized and classified loan balances
●	Nonperforming loans and other real estate decreased 30.3% and 16.6%, respectively, in 2015
●	Allowance for loan losses represented 210.32% of nonperforming loans, excluding impaired loans

Criticized and classified loan balances continued to reflect steady improvement. Relative to the prior quarter, criticized and classified loan balances decreased 8.0% and 3.4%, respectively. Compared to levels one year earlier, criticized and classified loan balances decreased 15.8% and 18.6%, respectively.

Nonperforming loans totaled $55.3 million at December 31, 2015, down 9.5% from the prior quarter and 30.3% year-over-year. Other real estate totaled $77.2 million, reflecting an 8.1% linked-quarter decrease and a 16.6% year-over-year reduction. Collectively, nonperforming assets totaled $132.5 million, reflecting a linked-quarter and year-over-year decrease of 8.7% and 22.9%, respectively.

Allocation of Trustmark's $67.6 million allowance for loan losses represented 1.05% of commercial loans and 0.66% of consumer and home mortgage loans, resulting in an allowance to total loans held for investment of 0.95% at December 31, 2015, representing a level management considers commensurate with the inherent risk in the loan portfolio. In aggregate, the allowance for both held for investment and acquired loan losses represented 1.06% of total loans, which include held for investment and acquired loans.

Unless noted otherwise, all of the above credit quality metrics exclude acquired loans and other real estate covered by FDIC loss-share agreement.

Revenue Generation

●	Net interest income (FTE) excluding acquired loans in 2015 totaled $357.0 million, up 3.7%, from the prior year
●	Noninterest income for the year totaled $173.1 million, reflecting in part growth from investments in insurance and mortgage businesses
●	Insurance revenue in 2015 totaled $36.4 million, the highest level in Trustmark’s history
●	Mortgage loan production volume in 2015 totaled $1.5 billion, up 24.3% from the prior year

Revenue in the fourth quarter totaled $139.1 million, down 3.1% from the prior quarter, reflecting in part a seasonal reduction in noninterest income. Net interest income (FTE) in the fourth quarter totaled $104.2 million, resulting in a net interest margin of 3.74%. Compared to the prior quarter, net interest income (FTE) increased $2.5 million primarily the result of growth in interest income (FTE) from both the held for sale and held for investment loan portfolios as well as the securities portfolio. The yield on acquired loans in the fourth quarter totaled 11.74% and included recoveries from settlement of debt of $5.4 million, which represented approximately 5.33% of the annualized total acquired loan yield. Excluding acquired loans, the net interest margin in the fourth quarter remained at 3.43%. Net interest income (FTE) in 2015 totaled $408.2 million, resulting in a net interest margin (FTE) of 3.78%; excluding acquired loans, the net interest margin (FTE) was 3.46%.

Noninterest income totaled $39.3 million in the fourth quarter, down from the prior quarter primarily as a result of seasonally lower mortgage banking revenues and insurance commissions, as well as decreased other income. In the fourth quarter, bank card and other fees totaled $7.2 million, up 2.8% from the prior quarter, while service charges on deposit accounts totaled $12.0 million, down 3.5% from the prior quarter. Other income, net decreased $1.9 million linked quarter, reflecting a $932 thousand increase in partnership amortization principally due to an additional tax credit investment as well as a $909 thousand increase in FDIC indemnification asset write-downs, which resulted from decreased write-downs of covered other real estate and the re-estimation of cash flows on covered acquired loans. Noninterest income for the year totaled $173.1 million and remained stable when compared to the prior year.

Insurance revenue in the fourth quarter totaled $8.5 million, reflecting a seasonal decrease of 14.2% from the prior quarter and an increase of 8.6% from levels one year earlier. For the year, insurance revenue totaled $36.4 million, up 8.8% relative to the prior year. The solid performance in 2015 reflects increased business development efforts, investments in additional producers and restructuring initiatives that supported enhanced productivity.

Wealth management revenue totaled $7.8 million in the fourth quarter, remaining stable relative to the prior quarter and down 7.4% from levels one year earlier. The year-over-year decline is primarily attributable to decreased brokerage activity, resulting in part from volatile market conditions. Wealth management revenue in 2015 totaled $31.4 million, down 3.0% relative to the prior year. Despite turbulent investment markets, Trustmark remained focused on servicing clients and realigned processes to enhance productivity.

Mortgage banking revenue in the fourth quarter totaled $4.3 million, down $3.2 million from the prior quarter. The linked-quarter decline is primarily attributable to a $2.5 million decrease in the mortgage servicing hedge ineffectiveness and a $1.6 million decrease in mark-to-market adjustments on mortgage loans held for sale. Mortgage loan production totaled $340.0 million, a seasonal decrease of 19.1% from the prior quarter and an increase of 15.7% year-over-year. In 2015, mortgage banking revenue totaled $30.2 million, up 21.8% from the prior year; mortgage loan production totaled $1.5 billion, up 24.3% from the prior year. The growth in mortgage banking revenue partially reflects a continued focus on productivity and customer service enhancements as well as investments in additional mortgage-loan producers and loan-production offices.

Noninterest Expense

●	Routine noninterest expense in 2015 remained well controlled and totaled $388.9 million, partially reflecting the re-allocation of cost savings into revenue-generating areas of the corporation
●	ORE and foreclosure expense decreased $6.4 million for the year, resulting from the continued resolution of problem assets
●	Tax credit investments reduced the effective tax rate to 23.4% in 2015
●	Continued retail delivery channel optimization in 2015: consolidated eight banking centers and opened three banking centers; realigned branch staffing levels; introduced new consumer mobile banking platform, myTrustmark℠

Excluding ORE expense and intangible amortization of $1.4 million, routine noninterest expense in the fourth quarter totaled $97.2 million, a decrease of $1.0 million, or 1.0%, from comparable expenses in the prior quarter. Salaries and benefits totaled $57.4 million in the fourth quarter, down 1.6% linked quarter and reflecting decreased insurance and mortgage-production commissions. Services and fees declined 6.6% from the prior quarter, reflecting in part a reduction in lower communications expense and third-party consulting fees. ORE and foreclosure expense improved from the prior quarter and provided an income benefit because of gains realized on the sale of foreclosed real estate. Relative to 2014, routine noninterest expense remained stable at $388.9 million as savings from realigned staffing levels and technology productivity enhancements were reallocated into new loan-production offices, additional relationship managers and new mobile-banking platforms.

Trustmark continued the optimization of its retail delivery channels to enhance productivity and efficiency as well as promote additional growth. During the fourth quarter, Trustmark opened a mortgage loan-production office in Tuscaloosa, Alabama. In 2015, Trustmark consolidated eight branch offices across Mississippi, Tennessee, Florida and Texas, and reallocated a portion of those resources into three new branch offices across Alabama and Mississippi. Overall, these collective efforts resulted in the consolidation of 27 branch offices and the establishment of eight new branch offices over the past three years. Trustmark is committed to developing and maintaining relationships, while supporting investments that promote profitable revenue growth as well as reengineering and efficiency opportunities to enhance shareholder value.

Additional Information

As previously announced, Trustmark will conduct a conference call with analysts on Wednesday, January 27, 2016, 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) 317-3051 or by clicking on the link provided under the Investor Relations section of our website at www.trustmark.com, which will also include a slide presentation Management will review during the conference call. A replay of the conference call will also be available through Wednesday, February 10, 2016, in archived format at the same web address or by calling (877) 344-7529, passcode 10078271.

Trustmark Corporation is a financial services company providing banking and financial solutions through 200 offices in Alabama, Florida, Mississippi, Tennessee and Texas.

Forward-Looking Statements

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

Risks that could cause actual results to differ materially from current expectations of Management include, but are not limited to, changes in the level of nonperforming assets and charge-offs, local, state and national economic and market conditions, including 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 as well as 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 issues relating to the European financial system, 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, cyber-attacks and other breaches which could affect our information system security, 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, 2015

($ in thousands)

(unaudited)

										Linked Quarter						Year over Year
QUARTERLY AVERAGE BALANCES	12/31/2015			9/30/2015			12/31/2014			$ Change			% Change			$ Change			% Change
Securities AFS-taxable	$	2,209,801		$	2,269,763		$	2,204,361		$	(59,962	)		-2.6	%	$	5,440			0.2	%
Securities AFS-nontaxable		110,290			116,290			129,403			(6,000	)		-5.2	%		(19,113	)		-14.8	%
Securities HTM-taxable		1,145,397			1,151,673			1,117,989			(6,276	)		-0.5	%		27,408			2.5	%
Securities HTM-nontaxable		35,755			36,278			42,040			(523	)		-1.4	%		(6,285	)		-15.0	%
Total securities		3,501,243			3,574,004			3,493,793			(72,761	)		-2.0	%		7,450			0.2	%
Loans (including loans held for sale)		7,089,672			6,771,947			6,494,369			317,725			4.7	%		595,303			9.2	%
Acquired loans:
Noncovered loans		384,306			421,262			544,260			(36,956	)		-8.8	%		(159,954	)		-29.4	%
Covered loans		18,341			18,982			27,039			(641	)		-3.4	%		(8,698	)		-32.2	%
Fed funds sold and rev repos		1,384			1,167			1,269			217			18.6	%		115			9.1	%
Other earning assets		68,016			58,534			48,224			9,482			16.2	%		19,792			41.0	%
Total earning assets		11,062,962			10,845,896			10,608,954			217,066			2.0	%		454,008			4.3	%
Allowance for loan losses		(78,652	)		(84,482	)		(82,851	)		5,830			-6.9	%		4,199			-5.1	%
Cash and due from banks		272,562			266,174			284,754			6,388			2.4	%		(12,192	)		-4.3	%
Other assets		1,266,712			1,286,189			1,317,217			(19,477	)		-1.5	%		(50,505	)		-3.8	%
Total assets	$	12,523,584		$	12,313,777		$	12,128,074		$	209,807			1.7	%	$	395,510			3.3	%

Interest-bearing demand deposits	$	1,917,598		$	1,915,567		$	1,815,999		$	2,031			0.1	%	$	101,599			5.6	%
Savings deposits		2,963,318			3,059,183			2,963,771			(95,865	)		-3.1	%		(453	)		0.0	%
Time deposits less than $100,000		1,033,233			1,072,373			1,152,622			(39,140	)		-3.6	%		(119,389	)		-10.4	%
Time deposits of $100,000 or more		687,635			712,910			838,309			(25,275	)		-3.5	%		(150,674	)		-18.0	%
Total interest-bearing deposits		6,601,784			6,760,033			6,770,701			(158,249	)		-2.3	%		(168,917	)		-2.5	%
Fed funds purchased and repos		563,424			528,232			526,482			35,192			6.7	%		36,942			7.0	%
Short-term borrowings		733,365			534,931			385,841			198,434			37.1	%		347,524			90.1	%
Long-term FHLB advances		50,078			1,195			2,652			48,883			n/m			47,426			n/m
Subordinated notes		49,964			49,955			49,931			9			0.0	%		33			0.1	%
Junior subordinated debt securities		61,856			61,856			61,856			-			0.0	%		-			0.0	%
Total interest-bearing liabilities		8,060,471			7,936,202			7,797,463			124,269			1.6	%		263,008			3.4	%
Noninterest-bearing deposits		2,839,894			2,771,186			2,762,332			68,708			2.5	%		77,562			2.8	%
Other liabilities		141,925			137,134			146,011			4,791			3.5	%		(4,086	)		-2.8	%
Total liabilities		11,042,290			10,844,522			10,705,806			197,768			1.8	%		336,484			3.1	%
Shareholders' equity		1,481,294			1,469,255			1,422,268			12,039			0.8	%		59,026			4.2	%
Total liabilities and equity	$	12,523,584		$	12,313,777		$	12,128,074		$	209,807			1.7	%	$	395,510			3.3	%

										Linked Quarter						Year over Year
PERIOD END BALANCES	12/31/2015			9/30/2015			12/31/2014			$ Change			% Change			$ Change			% Change
Cash and due from banks	$	277,751		$	220,052		$	315,973		$	57,699			26.2	%	$	(38,222	)		-12.1	%
Fed funds sold and rev repos		250			-			1,885			250			n/m			(1,635	)		-86.7	%
Securities available for sale		2,345,422			2,382,822			2,374,567			(37,400	)		-1.6	%		(29,145	)		-1.2	%
Securities held to maturity		1,187,818			1,178,440			1,170,685			9,378			0.8	%		17,133			1.5	%
Loans held for sale (LHFS)		160,189			173,679			132,196			(13,490	)		-7.8	%		27,993			21.2	%
Loans held for investment (LHFI)		7,091,385			6,791,643			6,449,469			299,742			4.4	%		641,916			10.0	%
Allowance for loan losses		(67,619	)		(65,607	)		(69,616	)		(2,012	)		3.1	%		1,997			-2.9	%
Net LHFI		7,023,766			6,726,036			6,379,853			297,730			4.4	%		643,913			10.1	%
Acquired loans:
Noncovered loans		372,711			400,528			525,783			(27,817	)		-6.9	%		(153,072	)		-29.1	%
Covered loans		17,700			18,645			23,626			(945	)		-5.1	%		(5,926	)		-25.1	%
Allowance for loan losses, acquired loans		(11,992	)		(12,185	)		(12,059	)		193			-1.6	%		67			-0.6	%
Net acquired loans		378,419			406,988			537,350			(28,569	)		-7.0	%		(158,931	)		-29.6	%
Net LHFI and acquired loans		7,402,185			7,133,024			6,917,203			269,161			3.8	%		484,982			7.0	%
Premises and equipment, net		195,656			196,558			200,781			(902	)		-0.5	%		(5,125	)		-2.6	%
Mortgage servicing rights		74,007			69,809			64,358			4,198			6.0	%		9,649			15.0	%
Goodwill		366,156			365,500			365,500			656			0.2	%		656			0.2	%
Identifiable intangible assets		27,546			30,129			33,234			(2,583	)		-8.6	%		(5,688	)		-17.1	%
Other real estate, excluding covered other real estate		77,177			83,955			92,509			(6,778	)		-8.1	%		(15,332	)		-16.6	%
Covered other real estate		1,651			2,865			6,060			(1,214	)		-42.4	%		(4,409	)		-72.8	%
FDIC indemnification asset		738			1,749			6,997			(1,011	)		-57.8	%		(6,259	)		-89.5	%
Other assets		562,350			551,694			568,685			10,656			1.9	%		(6,335	)		-1.1	%
Total assets	$	12,678,896		$	12,390,276		$	12,250,633		$	288,620			2.3	%	$	428,263			3.5	%

Deposits:
Noninterest-bearing	$	2,998,694		$	2,787,454		$	2,748,635		$	211,240			7.6	%	$	250,059			9.1	%
Interest-bearing		6,589,536			6,624,950			6,949,723			(35,414	)		-0.5	%		(360,187	)		-5.2	%
Total deposits		9,588,230			9,412,404			9,698,358			175,826			1.9	%		(110,128	)		-1.1	%
Fed funds purchased and repos		441,042			534,204			443,543			(93,162	)		-17.4	%		(2,501	)		-0.6	%
Short-term borrowings		412,617			709,845			425,077			(297,228	)		-41.9	%		(12,460	)		-2.9	%
Long-term FHLB advances		501,155			1,173			1,253			499,982			n/m			499,902			n/m
Subordinated notes		49,969			49,961			49,936			8			0.0	%		33			0.1	%
Junior subordinated debt securities		61,856			61,856			61,856			-			0.0	%		-			0.0	%
Other liabilities		150,970			144,077			150,670			6,893			4.8	%		300			0.2	%
Total liabilities		11,205,839			10,913,520			10,830,693			292,319			2.7	%		375,146			3.5	%
Common stock		14,076			14,076			14,060			-			0.0	%		16			0.1	%
Capital surplus		361,467			360,494			356,244			973			0.3	%		5,223			1.5	%
Retained earnings		1,142,908			1,130,766			1,092,120			12,142			1.1	%		50,788			4.7	%
Accum other comprehensive
loss, net of tax		(45,394	)		(28,580	)		(42,484	)		(16,814	)		58.8	%		(2,910	)		6.8	%
Total shareholders' equity		1,473,057			1,476,756			1,419,940			(3,699	)		-0.3	%		53,117			3.7	%
Total liabilities and equity	$	12,678,896		$	12,390,276		$	12,250,633		$	288,620			2.3	%	$	428,263			3.5	%

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, 2015

($ in thousands except per share data)

(unaudited)

	Quarter Ended									Linked Quarter						Year over Year
INCOME STATEMENTS	12/31/2015			9/30/2015			12/31/2014			$ Change			% Change			$ Change			% Change
Interest and fees on LHFS & LHFI-FTE	$	74,383		$	72,951		$	70,775		$	1,432			2.0	%	$	3,608			5.1	%
Interest and fees on acquired loans		11,910			11,607			13,500			303			2.6	%		(1,590	)		-11.8	%
Interest on securities-taxable		21,149			20,264			21,694			885			4.4	%		(545	)		-2.5	%
Interest on securities-tax exempt-FTE		1,565			1,609			1,814			(44	)		-2.7	%		(249	)		-13.7	%
Interest on fed funds sold and rev repos		4			2			3			2			100.0	%		1			33.3	%
Other interest income		402			392			384			10			2.6	%		18			4.7	%
Total interest income-FTE		109,413			106,825			108,170			2,588			2.4	%		1,243			1.1	%
Interest on deposits		3,000			3,147			3,382			(147	)		-4.7	%		(382	)		-11.3	%
Interest on fed funds pch and repos		274			205			184			69			33.7	%		90			48.9	%
Other interest expense		1,987			1,811			1,510			176			9.7	%		477			31.6	%
Total interest expense		5,261			5,163			5,076			98			1.9	%		185			3.6	%
Net interest income-FTE		104,152			101,662			103,094			2,490			2.4	%		1,058			1.0	%
Provision for loan losses, LHFI		3,043			2,514			(1,393	)		529			21.0	%		4,436			n/m
Provision for loan losses, acquired loans		997			1,256			1,179			(259	)		-20.6	%		(182	)		-15.4	%
Net interest income after provision-FTE		100,112			97,892			103,308			2,220			2.3	%		(3,196	)		-3.1	%
Service charges on deposit accounts		11,961			12,400			12,514			(439	)		-3.5	%		(553	)		-4.4	%
Insurance commissions		8,501			9,906			7,831			(1,405	)		-14.2	%		670			8.6	%
Wealth management		7,831			7,790			8,460			41			0.5	%		(629	)		-7.4	%
Bank card and other fees		7,156			6,964			6,712			192			2.8	%		444			6.6	%
Mortgage banking, net		4,287			7,443			5,918			(3,156	)		-42.4	%		(1,631	)		-27.6	%
Other, net		(466	)		1,470			596			(1,936	)		n/m			(1,062	)		n/m
Nonint inc-excl sec gains (losses), net		39,270			45,973			42,031			(6,703	)		-14.6	%		(2,761	)		-6.6	%
Security gains (losses), net		-			-			-			-			n/m			-			n/m
Total noninterest income		39,270			45,973			42,031			(6,703	)		-14.6	%		(2,761	)		-6.6	%
Salaries and employee benefits		57,366			58,270			57,159			(904	)		-1.6	%		207			0.4	%
Services and fees		13,717			14,691			14,401			(974	)		-6.6	%		(684	)		-4.7	%
Net occupancy-premises		6,304			6,580			6,632			(276	)		-4.2	%		(328	)		-4.9	%
Equipment expense		6,105			5,877			5,911			228			3.9	%		194			3.3	%
FDIC assessment expense		2,614			2,559			2,669			55			2.1	%		(55	)		-2.1	%
ORE/Foreclosure expense		(518	)		3,385			3,240			(3,903	)		n/m			(3,758	)		n/m
Other expense		13,032			12,198			14,420			834			6.8	%		(1,388	)		-9.6	%
Total noninterest expense		98,620			103,560			104,432			(4,940	)		-4.8	%		(5,812	)		-5.6	%
Income before income taxes and tax eq adj		40,762			40,305			40,907			457			1.1	%		(145	)		-0.4	%
Tax equivalent adjustment		4,334			4,056			4,179			278			6.9	%		155			3.7	%
Income before income taxes		36,428			36,249			36,728			179			0.5	%		(300	)		-0.8	%
Income taxes		8,570			7,819			8,655			751			9.6	%		(85	)		-1.0	%
Net income	$	27,858		$	28,430		$	28,073		$	(572	)		-2.0	%	$	(215	)		-0.8	%

Per share data
Earnings per share - basic	$	0.41		$	0.42		$	0.42		$	(0.01	)		-2.4	%	$	(0.01	)		-2.4	%

Earnings per share - diluted	$	0.41		$	0.42		$	0.42		$	(0.01	)		-2.4	%	$	(0.01	)		-2.4	%

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

Weighted average shares outstanding
Basic		67,557,991			67,557,395			67,445,721

Diluted		67,734,109			67,707,456			67,633,637

Period end shares outstanding		67,559,128			67,557,395			67,481,992

OTHER FINANCIAL DATA
Return on equity		7.46	%		7.68	%		7.83	%
Return on average tangible equity		10.61	%		10.96	%		11.40	%
Return on assets		0.88	%		0.92	%		0.92	%
Interest margin - Yield - FTE		3.92	%		3.91	%		4.05	%
Interest margin - Cost		0.19	%		0.19	%		0.19	%
Net interest margin - FTE		3.74	%		3.72	%		3.86	%
Efficiency ratio (1)		66.03	%		67.87	%		69.16	%
Full-time equivalent employees		2,941			2,963			3,060

STOCK PERFORMANCE
Market value-Close	$	23.04		$	23.17		$	24.54
Book value	$	21.80		$	21.86		$	21.04
Tangible book value	$	15.98		$	16.00		$	15.13

(1) - The efficiency ratio is noninterest expense to total net interest income (FTE) and noninterest income, excluding security gains (losses), amortization of
partnership tax credits, amortization of purchased intangibles, and nonroutine income and expense items.

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, 2015

($ in thousands)

(unaudited)

	Quarter Ended									Linked Quarter						Year over Year
NONPERFORMING ASSETS (1)	12/31/2015			9/30/2015			12/31/2014			$ Change			% Change			$ Change			% Change
Nonaccrual loans
Alabama	$	1,776		$	1,306		$	852		$	470			36.0	%	$	924			n/m
Florida		5,180			7,444			11,091			(2,264	)		-30.4	%		(5,911	)		-53.3	%
Mississippi (2)		40,754			44,955			57,129			(4,201	)		-9.3	%		(16,375	)		-28.7	%
Tennessee (3)		5,106			4,911			5,819			195			4.0	%		(713	)		-12.3	%
Texas		2,496			2,515			4,452			(19	)		-0.8	%		(1,956	)		-43.9	%
Total nonaccrual loans		55,312			61,131			79,343			(5,819	)		-9.5	%		(24,031	)		-30.3	%
Other real estate
Alabama		21,578			23,822			21,196			(2,244	)		-9.4	%		382			1.8	%
Florida		29,579			30,374			35,324			(795	)		-2.6	%		(5,745	)		-16.3	%
Mississippi (2)		14,312			13,180			17,397			1,132			8.6	%		(3,085	)		-17.7	%
Tennessee (3)		9,974			9,840			10,292			134			1.4	%		(318	)		-3.1	%
Texas		1,734			6,739			8,300			(5,005	)		-74.3	%		(6,566	)		-79.1	%
Total other real estate		77,177			83,955			92,509			(6,778	)		-8.1	%		(15,332	)		-16.6	%
Total nonperforming assets	$	132,489		$	145,086		$	171,852		$	(12,597	)		-8.7	%	$	(39,363	)		-22.9	%

LOANS PAST DUE OVER 90 DAYS (4)
LHFI	$	2,300		$	9,224		$	2,764		$	(6,924	)		-75.1	%	$	(464	)		-16.8	%

LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase)	$	21,812		$	15,165		$	25,943		$	6,647			43.8	%	$	(4,131	)		-15.9	%

	Quarter Ended									Linked Quarter						Year over Year
ALLOWANCE FOR LOAN LOSSES (4)	12/31/2015			9/30/2015			12/31/2014			$ Change			% Change			$ Change			% Change
Beginning Balance	$	65,607		$	71,166		$	70,134		$	(5,559	)		-7.8	%	$	(4,527	)		-6.5	%
Provision for loan losses		3,043			2,514			(1,393	)		529			21.0	%		4,436			n/m
Charge-offs		(3,781	)		(11,406	)		(3,174	)		7,625			-66.9	%		(607	)		19.1	%
Recoveries		2,750			3,333			4,049			(583	)		-17.5	%		(1,299	)		-32.1	%
Net (charge-offs) recoveries		(1,031	)		(8,073	)		875			7,042			-87.2	%		(1,906	)		n/m
Ending Balance	$	67,619		$	65,607		$	69,616		$	2,012			3.1	%	$	(1,997	)		-2.9	%

PROVISION FOR LOAN LOSSES (4)
Alabama	$	1,453		$	(70	)	$	283		$	1,523			n/m		$	1,170			n/m
Florida		(1,357	)		(1,430	)		(66	)		73			-5.1	%		(1,291	)		n/m
Mississippi (2)		1,842			4,221			(3,065	)		(2,379	)		-56.4	%		4,907			n/m
Tennessee (3)		182			(1,050	)		1,993			1,232			n/m			(1,811	)		-90.9	%
Texas		923			843			(538	)		80			9.5	%		1,461			n/m
Total provision for loan losses	$	3,043		$	2,514		$	(1,393	)	$	529			21.0	%	$	4,436			n/m

NET CHARGE-OFFS (4)
Alabama	$	422		$	163		$	92		$	259			n/m		$	330			n/m
Florida		(389	)		(1,090	)		(226	)		701			-64.3	%		(163	)		72.1	%
Mississippi (2)		925			7,391			(880	)		(6,466	)		-87.5	%		1,805			n/m
Tennessee (3)		188			448			325			(260	)		-58.0	%		(137	)		-42.2	%
Texas		(115	)		1,161			(186	)		(1,276	)		n/m			71			-38.2	%
Total net charge-offs (recoveries)	$	1,031		$	8,073		$	(875	)	$	(7,042	)		-87.2	%	$	1,906			n/m

CREDIT QUALITY RATIOS (1)
Net charge-offs/average loans		0.06	%		0.47	%		-0.05	%
Provision for loan losses/average loans		0.17	%		0.15	%		-0.09	%
Nonperforming loans/total loans (incl LHFS)		0.76	%		0.88	%		1.21	%
Nonperforming assets/total loans (incl LHFS)		1.83	%		2.08	%		2.61	%
Nonperforming assets/total loans (incl LHFS) +ORE		1.81	%		2.06	%		2.57	%
ALL/total loans (excl LHFS)		0.95	%		0.97	%		1.08	%
ALL-commercial/total commercial loans		1.05	%		1.07	%		1.23	%
ALL-consumer/total consumer and home mortgage loans		0.66	%		0.67	%		0.67	%
ALL/nonperforming loans		122.25	%		107.32	%		87.74	%
ALL/nonperforming loans -
(excl impaired loans)		210.32	%		206.72	%		180.95	%

CAPITAL RATIOS
Total equity/total assets		11.62	%		11.92	%		11.59	%
Tangible equity/tangible assets		8.79	%		9.01	%		8.62	%
Tangible equity/risk-weighted assets		11.68	%		12.24	%		12.17	%
Tier 1 leverage ratio		10.03	%		10.09	%		9.63	%
Tier 1 common risk-based capital ratio - BASEL I		-			-			12.75	%
Common equity tier 1 capital ratio - BASEL III		12.57	%		13.00	%		-
Tier 1 risk-based capital ratio		13.21	%		13.66	%		13.47	%
Total risk-based capital ratio		14.07	%		14.66	%		14.56	%

(1) - Excludes acquired loans and covered other real estate
(2) - Mississippi includes Central and Southern Mississippi Regions
(3) - Tennessee includes Memphis, Tennessee and Northern Mississippi Regions
(4) - Excludes acquired loans

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

See Notes to Conslidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

December 31, 2015

($ in thousands)

(unaudited)

	Quarter Ended															Year Ended
AVERAGE BALANCES	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014			12/31/2015			12/31/2014
Securities AFS-taxable	$	2,209,801		$	2,269,763		$	2,255,485		$	2,190,344		$	2,204,361		$	2,231,507		$	2,187,258
Securities AFS-nontaxable		110,290			116,290			120,330			127,623			129,403			118,579			136,532
Securities HTM-taxable		1,145,397			1,151,673			1,143,273			1,119,979			1,117,989			1,140,182			1,120,886
Securities HTM-nontaxable		35,755			36,278			38,173			41,405			42,040			37,883			39,975
Total securities		3,501,243			3,574,004			3,557,261			3,479,351			3,493,793			3,528,151			3,484,651
Loans (including loans held for sale)		7,089,672			6,771,947			6,554,739			6,561,430			6,494,369			6,745,970			6,250,151
Acquired loans:
Noncovered loans		384,306			421,262			462,418			502,534			544,260			442,248			635,890
Covered loans		18,341			18,982			20,574			23,593			27,039			20,354			30,212
Fed funds sold and rev repos		1,384			1,167			557			217			1,269			835			3,638
Other earning assets		68,016			58,534			41,242			46,368			48,224			53,613			40,828
Total earning assets		11,062,962			10,845,896			10,636,791			10,613,493			10,608,954			10,791,171			10,445,370
Allowance for loan losses		(78,652	)		(84,482	)		(84,331	)		(81,993	)		(82,851	)		(82,361	)		(79,621	)
Cash and due from banks		272,562			266,174			272,292			290,251			284,754			275,246			316,843
Other assets		1,266,712			1,286,189			1,288,507			1,303,552			1,317,217			1,286,139			1,345,438
Total assets	$	12,523,584		$	12,313,777		$	12,113,259		$	12,125,303		$	12,128,074		$	12,270,195		$	12,028,030

Interest-bearing demand deposits	$	1,917,598		$	1,915,567		$	1,924,447		$	1,847,374		$	1,815,999		$	1,901,478		$	1,837,496
Savings deposits		2,963,318			3,059,183			3,226,380			3,252,586			2,963,771			3,124,393			3,116,251
Time deposits less than $100,000		1,033,233			1,072,373			1,101,477			1,139,912			1,152,622			1,086,417			1,211,242
Time deposits of $100,000 or more		687,635			712,910			751,129			785,715			838,309			734,020			892,571
Total interest-bearing deposits		6,601,784			6,760,033			7,003,433			7,025,587			6,770,701			6,846,308			7,057,560
Fed funds purchased and repos		563,424			528,232			497,606			421,206			526,482			503,077			435,324
Short-term borrowings		733,365			534,931			128,761			256,714			385,841			415,081			173,759
Long-term FHLB advances		50,078			1,195			1,213			1,243			2,652			13,533			6,837
Subordinated notes		49,964			49,955			49,947			49,939			49,931			49,951			49,919
Junior subordinated debt securities		61,856			61,856			61,856			61,856			61,856			61,856			61,856
Total interest-bearing liabilities		8,060,471			7,936,202			7,742,816			7,816,545			7,797,463			7,889,806			7,785,255
Noninterest-bearing deposits		2,839,894			2,771,186			2,772,741			2,741,945			2,762,332			2,781,682			2,711,727
Other liabilities		141,925			137,134			143,201			129,844			146,011			138,057			132,103
Total liabilities		11,042,290			10,844,522			10,658,758			10,688,334			10,705,806			10,809,545			10,629,085
Shareholders' equity		1,481,294			1,469,255			1,454,501			1,436,969			1,422,268			1,460,650			1,398,945
Total liabilities and equity	$	12,523,584		$	12,313,777		$	12,113,259		$	12,125,303		$	12,128,074		$	12,270,195		$	12,028,030

PERIOD END BALANCES	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014
Cash and due from banks	$	277,751		$	220,052		$	255,050		$	335,244		$	315,973
Fed funds sold and rev repos		250			-			-			-			1,885
Securities available for sale		2,345,422			2,382,822			2,446,383			2,381,459			2,374,567
Securities held to maturity		1,187,818			1,178,440			1,190,161			1,184,554			1,170,685
Loans held for sale (LHFS)		160,189			173,679			147,539			150,365			132,196
Loans held for investment (LHFI)		7,091,385			6,791,643			6,447,073			6,413,876			6,449,469
Allowance for loan losses		(67,619	)		(65,607	)		(71,166	)		(71,321	)		(69,616	)
Net LHFI		7,023,766			6,726,036			6,375,907			6,342,555			6,379,853
Acquired loans:
Noncovered loans		372,711			400,528			447,160			478,172			525,783
Covered loans		17,700			18,645			19,239			20,271			23,626
Allowance for loan losses, acquired loans		(11,992	)		(12,185	)		(12,629	)		(11,837	)		(12,059	)
Net acquired loans		378,419			406,988			453,770			486,606			537,350
Net LHFI and acquired loans		7,402,185			7,133,024			6,829,677			6,829,161			6,917,203
Premises and equipment, net		195,656			196,558			196,220			198,039			200,781
Mortgage servicing rights		74,007			69,809			71,422			62,903			64,358
Goodwill		366,156			365,500			365,500			365,500			365,500
Identifiable intangible assets		27,546			30,129			32,042			31,250			33,234
Other real estate, excluding covered other real estate		77,177			83,955			90,748			90,175			92,509
Covered other real estate		1,651			2,865			3,755			4,794			6,060
FDIC indemnification asset		738			1,749			2,632			4,743			6,997
Other assets		562,350			551,694			551,319			540,977			568,685
Total assets	$	12,678,896		$	12,390,276		$	12,182,448		$	12,179,164		$	12,250,633

Deposits:
Noninterest-bearing	$	2,998,694		$	2,787,454		$	2,819,171		$	2,936,875		$	2,748,635
Interest-bearing		6,589,536			6,624,950			6,973,003			6,970,115			6,949,723
Total deposits		9,588,230			9,412,404			9,792,174			9,906,990			9,698,358
Fed funds purchased and repos		441,042			534,204			477,462			523,187			443,543
Short-term borrowings		412,617			709,845			201,744			50,570			425,077
Long-term FHLB advances		501,155			1,173			1,204			1,222			1,253
Subordinated notes		49,969			49,961			49,953			49,944			49,936
Junior subordinated debt securities		61,856			61,856			61,856			61,856			61,856
Other liabilities		150,970			144,077			147,646			139,311			150,670
Total liabilities		11,205,839			10,913,520			10,732,039			10,733,080			10,830,693
Common stock		14,076			14,076			14,076			14,076			14,060
Capital surplus		361,467			360,494			359,533			358,583			356,244
Retained earnings		1,142,908			1,130,766			1,117,993			1,103,077			1,092,120
Accum other comprehensive
loss, net of tax		(45,394	)		(28,580	)		(41,193	)		(29,652	)		(42,484	)
Total shareholders' equity		1,473,057			1,476,756			1,450,409			1,446,084			1,419,940
Total liabilities and equity	$	12,678,896		$	12,390,276		$	12,182,448		$	12,179,164		$	12,250,633

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

December 31, 2015

($ in thousands except per share data)

(unaudited)

	Quarter Ended															Year Ended
INCOME STATEMENTS	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014			12/31/2015			12/31/2014
Interest and fees on LHFS & LHFI-FTE	$	74,383		$	72,951		$	71,546		$	69,658		$	70,775		$	288,538		$	276,775
Interest and fees on acquired loans		11,910			11,607			12,557			15,078			13,500			51,152			76,736
Interest on securities-taxable		21,149			20,264			19,731			19,586			21,694			80,730			80,148
Interest on securities-tax exempt-FTE		1,565			1,609			1,688			1,789			1,814			6,651			7,491
Interest on fed funds sold and rev repos		4			2			2			-			3			8			23
Other interest income		402			392			392			393			384			1,579			1,524
Total interest income-FTE		109,413			106,825			105,916			106,504			108,170			428,658			442,697
Interest on deposits		3,000			3,147			3,204			3,247			3,382			12,598			15,323
Interest on fed funds pch and repos		274			205			179			143			184			801			550
Other interest expense		1,987			1,811			1,614			1,649			1,510			7,061			5,673
Total interest expense		5,261			5,163			4,997			5,039			5,076			20,460			21,546
Net interest income-FTE		104,152			101,662			100,919			101,465			103,094			408,198			421,151
Provision for loan losses, LHFI		3,043			2,514			1,033			1,785			(1,393	)		8,375			1,211
Provision for loan losses, acquired loans		997			1,256			825			347			1,179			3,425			6,171
Net interest income after provision-FTE		100,112			97,892			99,061			99,333			103,308			396,398			413,769
Service charges on deposit accounts		11,961			12,400			11,920			11,085			12,514			47,366			48,671
Insurance commissions		8,501			9,906			9,401			8,616			7,831			36,424			33,468
Wealth management		7,831			7,790			7,758			7,990			8,460			31,369			32,343
Bank card and other fees		7,156			6,964			7,416			6,762			6,712			28,298			32,966
Mortgage banking, net		4,287			7,443			9,481			8,965			5,918			30,176			24,780
Other, net		(466	)		1,470			(433	)		(1,055	)		596			(484	)		614
Nonint inc-excl sec gains (losses), net		39,270			45,973			45,543			42,363			42,031			173,149			172,842
Security gains (losses), net		-			-			-			-			-			-			300
Total noninterest income		39,270			45,973			45,543			42,363			42,031			173,149			173,142
Salaries and employee benefits		57,366			58,270			57,393			57,169			57,159			230,198			226,694
Services and fees		13,717			14,691			15,005			14,121			14,401			57,534			56,598
Net occupancy-premises		6,304			6,580			6,243			6,191			6,632			25,318			26,468
Equipment expense		6,105			5,877			5,903			5,974			5,911			23,859			23,860
FDIC assessment expense		2,614			2,559			2,615			2,940			2,669			10,728			10,197
ORE/Foreclosure expense		(518	)		3,385			921			1,115			3,240			4,903			11,321
Other expense		13,032			12,198			12,186			11,706			14,420			49,122			53,867
Total noninterest expense		98,620			103,560			100,266			99,216			104,432			401,662			409,005
Income before income taxes and tax eq adj		40,762			40,305			44,338			42,480			40,907			167,885			177,906
Tax equivalent adjustment		4,334			4,056			3,970			4,073			4,179			16,433			15,815
Income before income taxes		36,428			36,249			40,368			38,407			36,728			151,452			162,091
Income taxes		8,570			7,819			9,766			9,259			8,655			35,414			38,529
Net income	$	27,858		$	28,430		$	30,602		$	29,148		$	28,073		$	116,038		$	123,562

Per share data
Earnings per share - basic	$	0.41		$	0.42		$	0.45		$	0.43		$	0.42		$	1.72		$	1.83

Earnings per share - diluted	$	0.41		$	0.42		$	0.45		$	0.43		$	0.42		$	1.71		$	1.83

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

Weighted average shares outstanding
Basic		67,557,991			67,557,395			67,556,825			67,525,791			67,445,721			67,549,611			67,433,942

Diluted		67,734,109			67,707,456			67,685,449			67,639,326			67,633,637			67,691,821			67,594,010

Period end shares outstanding		67,559,128			67,557,395			67,557,395			67,556,591			67,481,992			67,559,128			67,481,992


OTHER FINANCIAL DATA
Return on equity		7.46	%		7.68	%		8.44	%		8.23	%		7.83	%		7.94	%		8.83	%
Return on average tangible equity		10.61	%		10.96	%		12.05	%		11.86	%		11.40	%		11.36	%		12.97	%
Return on assets		0.88	%		0.92	%		1.01	%		0.97	%		0.92	%		0.95	%		1.03	%
Interest margin - Yield - FTE		3.92	%		3.91	%		3.99	%		4.07	%		4.05	%		3.97	%		4.24	%
Interest margin - Cost		0.19	%		0.19	%		0.19	%		0.19	%		0.19	%		0.19	%		0.21	%
Net interest margin - FTE		3.74	%		3.72	%		3.81	%		3.88	%		3.86	%		3.78	%		4.03	%
Efficiency ratio (1)		66.03	%		67.87	%		66.00	%		66.46	%		69.16	%		66.60	%		66.07	%
Full-time equivalent employees		2,941			2,963			2,989			3,038			3,060


STOCK PERFORMANCE
Market value-Close	$	23.04		$	23.17		$	24.98		$	24.28		$	24.54
Book value	$	21.80		$	21.86		$	21.47		$	21.41		$	21.04
Tangible book value	$	15.98		$	16.00		$	15.58		$	15.53		$	15.13

(1) - The efficiency ratio is noninterest expense to total net interest income (FTE) and noninterest income, excluding security gains (losses), amortization of
partnership tax credits, amortization of purchased intangibles, and nonroutine income and expense items.

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL INFORMATION

December 31, 2015

($ in thousands)

(unaudited)

	Quarter Ended
NONPERFORMING ASSETS (1)	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014
Nonaccrual loans
Alabama	$	1,776		$	1,306		$	713		$	902		$	852
Florida		5,180			7,444			7,892			8,179			11,091
Mississippi (2)		40,754			44,955			52,051			52,145			57,129
Tennessee (3)		5,106			4,911			5,468			4,197			5,819
Texas		2,496			2,515			2,314			11,585			4,452
Total nonaccrual loans		55,312			61,131			68,438			77,008			79,343
Other real estate
Alabama		21,578			23,822			21,849			21,795			21,196
Florida		29,579			30,374			31,059			34,746			35,324
Mississippi (2)		14,312			13,180			14,094			15,143			17,397
Tennessee (3)		9,974			9,840			9,707			10,072			10,292
Texas		1,734			6,739			14,039			8,419			8,300
Total other real estate		77,177			83,955			90,748			90,175			92,509
Total nonperforming assets	$	132,489		$	145,086		$	159,186		$	167,183		$	171,852

LOANS PAST DUE OVER 90 DAYS (4)
LHFI	$	2,300		$	9,224		$	1,771		$	1,413		$	2,764

LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase)	$	21,812		$	15,165		$	11,987		$	7,584		$	25,943


	Quarter Ended															Year Ended
ALLOWANCE FOR LOAN LOSSES(4)	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014			12/31/2015			12/31/2014
Beginning Balance	$	65,607		$	71,166		$	71,321		$	69,616		$	70,134		$	69,616		$	66,448
Provision for loan losses		3,043			2,514			1,033			1,785			(1,393	)		8,375			1,211
Charge-offs		(3,781	)		(11,406	)		(4,278	)		(3,004	)		(3,174	)		(22,469	)		(13,226	)
Recoveries		2,750			3,333			3,090			2,924			4,049			12,097			15,183
Net (charge-offs) recoveries		(1,031	)		(8,073	)		(1,188	)		(80	)		875			(10,372	)		1,957
Ending Balance	$	67,619		$	65,607		$	71,166		$	71,321		$	69,616		$	67,619		$	69,616

PROVISION FOR LOAN LOSSES (4)
Alabama	$	1,453		$	(70	)	$	623		$	761		$	283		$	2,767		$	2,544
Florida		(1,357	)		(1,430	)		(1,168	)		1,833			(66	)		(2,122	)		(5,726	)
Mississippi (2)		1,842			4,221			2,046			(2,729	)		(3,065	)		5,380			6,474
Tennessee (3)		182			(1,050	)		(483	)		1,432			1,993			81			1,045
Texas		923			843			15			488			(538	)		2,269			(3,126	)
Total provision for loan losses	$	3,043		$	2,514		$	1,033		$	1,785		$	(1,393	)	$	8,375		$	1,211

NET CHARGE-OFFS (4)
Alabama	$	422		$	163		$	216		$	144		$	92		$	945		$	403
Florida		(389	)		(1,090	)		539			(28	)		(226	)		(968	)		(3,364	)
Mississippi (2)		925			7,391			1,028			143			(880	)		9,487			1,776
Tennessee (3)		188			448			105			(216	)		325			525			459
Texas		(115	)		1,161			(700	)		37			(186	)		383			(1,231	)
Total net charge-offs (recoveries)	$	1,031		$	8,073		$	1,188		$	80		$	(875	)	$	10,372		$	(1,957	)

CREDIT QUALITY RATIOS (1)
Net charge-offs/average loans		0.06	%		0.47	%		0.07	%		0.00	%		-0.05	%		0.15	%		-0.03	%
Provision for loan losses/average loans		0.17	%		0.15	%		0.06	%		0.11	%		-0.09	%		0.12	%		0.02	%
Nonperforming loans/total loans (incl LHFS)		0.76	%		0.88	%		1.04	%		1.17	%		1.21	%
Nonperforming assets/total loans (incl LHFS)		1.83	%		2.08	%		2.41	%		2.55	%		2.61	%
Nonperforming assets/total loans (incl LHFS) +ORE		1.81	%		2.06	%		2.38	%		2.51	%		2.57	%
ALL/total loans (excl LHFS)		0.95	%		0.97	%		1.10	%		1.11	%		1.08	%
ALL-commercial/total commercial loans		1.05	%		1.07	%		1.30	%		1.30	%		1.23	%
ALL-consumer/total consumer and home mortgage loans		0.66	%		0.67	%		0.59	%		0.61	%		0.67	%
ALL/nonperforming loans		122.25	%		107.32	%		103.99	%		92.62	%		87.74	%
ALL/nonperforming loans -
(excl impaired loans)		210.32	%		206.72	%		192.60	%		205.52	%		180.95	%

CAPITAL RATIOS
Total equity/total assets		11.62	%		11.92	%		11.91	%		11.87	%		11.59	%
Tangible equity/tangible assets		8.79	%		9.01	%		8.93	%		8.91	%		8.62	%
Tangible equity/risk-weighted assets		11.68	%		12.24	%		12.34	%		12.34	%		12.17	%
Tier 1 leverage ratio		10.03	%		10.09	%		10.14	%		9.99	%		9.63	%
Tier 1 common risk-based capital ratio - BASEL I		-			-			-			-			12.75	%
Common equity tier 1 capital ratio - BASEL III		12.57	%		13.00	%		13.28	%		13.14	%		-
Tier 1 risk-based capital ratio		13.21	%		13.66	%		13.97	%		13.83	%		13.47	%
Total risk-based capital ratio		14.07	%		14.66	%		15.07	%		14.92	%		14.56	%


(1) - Excludes acquired loans and covered other real estate
(2) - Mississippi includes Central and Southern Mississippi Regions
(3) - Tennessee includes Memphis, Tennessee and Northern Mississippi Regions
(4) - Excludes acquired loans

See Notes to Consolidated Financials

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2015

($ 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 ($ in thousands):

	12/31/2015		9/30/2015		6/30/2015		3/31/2015		12/31/2014
SECURITIES AVAILABLE FOR SALE
U.S. Treasury securities	$	-	$	-	$	-	$	-	$	100
U.S. Government agency obligations
Issued by U.S. Government agencies		68,135		71,282		74,409		78,115		79,656
Issued by U.S. Government sponsored agencies		281		23,016		33,009		33,076		32,818
Obligations of states and political subdivisions		138,609		147,794		151,322		160,154		162,258
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA		25,812		26,651		20,651		12,010		12,427
Issued by FNMA and FHLMC		225,542		177,411		185,651		195,470		204,441
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		1,582,860		1,630,402		1,662,476		1,646,710		1,661,833
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		279,226		279,609		290,398		225,826		189,334
Asset-backed securities and structured financial products		24,957		26,657		28,467		30,098		31,700
Total securities available for sale	$	2,345,422	$	2,382,822	$	2,446,383	$	2,381,459	$	2,374,567

SECURITIES HELD TO MATURITY
U.S. Government agency obligations
Issued by U.S. Government sponsored agencies	$	101,782	$	101,578	$	101,374	$	101,171	$	100,971
Obligations of states and political subdivisions		55,892		56,661		56,978		62,928		63,505
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA		17,363		17,783		18,265		18,861		19,115
Issued by FNMA and FHLMC		10,368		10,669		10,965		11,341		11,437
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		820,012		808,763		838,989		842,827		834,176
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		182,401		182,986		163,590		147,426		141,481
Total securities held to maturity	$	1,187,818	$	1,178,440	$	1,190,161	$	1,184,554	$	1,170,685

During the fourth quarter of 2013, Trustmark reclassified approximately $1.099 billion 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 $46.6 million ($28.8 million, net of tax). The net unrealized holding loss is 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 December 31, 2015, the net unamortized, unrealized loss on the transferred securities included in accumulated other comprehensive loss in the accompanying balance sheet totaled approximately $34.0 million ($21.0 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 approximately 94% 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.

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2015

($ in thousands)

(unaudited)

Note 2 – Loan Composition

LHFI BY TYPE (excluding acquired loans)	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014
Loans secured by real estate:
Construction, land development and other land loans	$	824,723		$	785,472		$	682,444		$	691,657		$	619,877
Secured by 1-4 family residential properties		1,649,501			1,638,639			1,637,933			1,613,993			1,634,397
Secured by nonfarm, nonresidential properties		1,736,476			1,604,453			1,567,035			1,516,895			1,553,193
Other real estate secured		211,228			225,523			240,056			233,322			253,787
Commercial and industrial loans		1,343,211			1,270,277			1,219,684			1,228,788			1,270,350
Consumer loans		169,135			169,509			165,215			161,535			167,964
State and other political subdivision loans		734,615			677,539			574,265			614,330			602,727
Other loans		422,496			420,231			360,441			353,356			347,174
LHFI		7,091,385			6,791,643			6,447,073			6,413,876			6,449,469
Allowance for loan losses		(67,619	)		(65,607	)		(71,166	)		(71,321	)		(69,616	)
Net LHFI	$	7,023,766		$	6,726,036		$	6,375,907		$	6,342,555		$	6,379,853

ACQUIRED NONCOVERED LOANS BY TYPE	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014
Loans secured by real estate:
Construction, land development and other land loans	$	41,623		$	45,299		$	50,867		$	51,363		$	58,309
Secured by 1-4 family residential properties		86,950			96,870			101,027			111,830			116,920
Secured by nonfarm, nonresidential properties		135,626			146,614			168,698			177,210			202,323
Other real estate secured		23,860			23,816			25,666			26,819			27,813
Commercial and industrial loans		55,075			57,748			73,732			81,261			88,256
Consumer loans		5,641			6,295			7,273			8,494			9,772
Other loans		23,936			23,886			19,897			21,195			22,390
Noncovered loans		372,711			400,528			447,160			478,172			525,783
Allowance for loan losses		(11,259	)		(11,417	)		(11,927	)		(11,106	)		(10,541	)
Net noncovered loans	$	361,452		$	389,111		$	435,233		$	467,066		$	515,242

ACQUIRED COVERED LOANS BY TYPE	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014
Loans secured by real estate:
Construction, land development and other land loans	$	1,021		$	966		$	904		$	1,447		$	1,197
Secured by 1-4 family residential properties		10,058			10,546			11,080			11,200			13,180
Secured by nonfarm, nonresidential properties		4,638			5,363			5,206			5,844			7,672
Other real estate secured		1,286			1,511			1,622			1,469			1,096
Commercial and industrial loans		624			205			371			255			277
Consumer loans		-			-			-			-			-
Other loans		73			54			56			56			204
Covered loans		17,700			18,645			19,239			20,271			23,626
Allowance for loan losses		(733	)		(768	)		(702	)		(731	)		(1,518	)
Net covered loans	$	16,967		$	17,877		$	18,537		$	19,540		$	22,108

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2015

($ in thousands)

(unaudited)

Note 2 – Loan Composition (continued)
	December 31, 2015
LHFI - COMPOSITION BY REGION (1)	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	$	824,723	$	125,498	$	55,546	$	313,173	$	44,043	$	286,463
Secured by 1-4 family residential properties		1,649,501		58,893		49,176		1,409,421		112,529		19,482
Secured by nonfarm, nonresidential properties		1,736,476		218,852		165,992		807,331		145,551		398,750
Other real estate secured		211,228		18,581		5,954		108,176		17,807		60,710
Commercial and industrial loans		1,343,211		107,549		12,763		702,876		220,294		299,729
Consumer loans		169,135		18,059		2,871		128,357		17,038		2,810
State and other political subdivision loans		734,615		45,559		27,361		513,481		24,784		123,430
Other loans		422,496		26,617		19,335		288,698		42,783		45,063
Loans	$	7,091,385	$	619,608	$	338,998	$	4,271,513	$	624,829	$	1,236,437



CONSTRUCTION, LAND DEVELOPMENT AND OTHER LAND LOANS BY REGION (1)
Lots	$	49,906	$	6,655	$	20,054	$	16,671	$	2,164	$	4,362
Development		54,174		8,760		4,210		25,451		764		14,989
Unimproved land		109,681		8,799		18,485		43,945		18,698		19,754
1-4 family construction		155,008		30,226		9,317		75,090		1,826		38,549
Other construction		455,954		71,058		3,480		152,016		20,591		208,809
Construction, land development and other land loans	$	824,723	$	125,498	$	55,546	$	313,173	$	44,043	$	286,463




LOANS SECURED BY NONFARM, NONRESIDENTIAL PROPERTIES BY REGION (1)
Income producing:
Retail	$	215,549	$	51,801	$	36,545	$	69,580	$	19,122	$	38,501
Office		216,832		31,277		31,794		74,840		7,275		71,646
Nursing homes/assisted living		95,170		-		-		89,716		5,454		-
Hotel/motel		149,813		33,468		22,200		38,257		32,668		23,220
Industrial		70,422		7,053		8,493		9,994		3,949		40,933
Health care		24,515		530		871		23,111		3		-
Convenience stores		16,783		233		-		10,855		1,121		4,574
Other		186,930		20,452		17,992		80,627		3,902		63,957
Total income producing loans		976,014		144,814		117,895		396,980		73,494		242,831

Owner-occupied:
Office		119,550		9,506		20,902		59,584		8,971		20,587
Churches		93,227		8,049		2,267		45,311		28,212		9,388
Industrial warehouses		129,216		5,049		4,117		63,085		10,840		46,125
Health care		118,931		19,632		7,905		60,774		10,428		20,192
Convenience stores		81,653		6,787		1,798		47,007		2,802		23,259
Retail		29,568		2,482		5,648		15,884		2,822		2,732
Restaurants		28,214		2,466		1,768		22,624		-		1,356
Auto dealerships		10,842		8,246		105		2,491		-		-
Other		149,261		11,821		3,587		93,591		7,982		32,280
Total owner-occupied loans		760,462		74,038		48,097		410,351		72,057		155,919
Loans secured by nonfarm, nonresidential properties	$	1,736,476	$	218,852	$	165,992	$	807,331	$	145,551	$	398,750

(1) Excludes acquired loans.

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2015

($ 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															Year Ended
	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014			12/31/2015			12/31/2014
Securities – taxable		2.50	%		2.35	%		2.33	%		2.40	%		2.59	%		2.39	%		2.42	%
Securities – nontaxable		4.25	%		4.18	%		4.27	%		4.29	%		4.20	%		4.25	%		4.24	%
Securities – total		2.57	%		2.43	%		2.42	%		2.49	%		2.67	%		2.48	%		2.52	%
Loans - LHFI & LHFS		4.16	%		4.27	%		4.38	%		4.31	%		4.32	%		4.28	%		4.43	%
Acquired loans		11.74	%		10.46	%		10.43	%		11.62	%		9.38	%		11.06	%		11.52	%
Loans - total		4.57	%		4.65	%		4.79	%		4.85	%		4.73	%		4.71	%		5.11	%
FF sold & rev repo		1.15	%		0.68	%		1.44	%		0.00	%		0.94	%		0.96	%		0.63	%
Other earning assets		2.34	%		2.66	%		3.81	%		3.44	%		3.16	%		2.95	%		3.73	%
Total earning assets		3.92	%		3.91	%		3.99	%		4.07	%		4.05	%		3.97	%		4.24	%

Interest-bearing deposits		0.18	%		0.18	%		0.18	%		0.19	%		0.20	%		0.18	%		0.22	%
FF pch & repo		0.19	%		0.15	%		0.14	%		0.14	%		0.14	%		0.16	%		0.13	%
Other borrowings		0.88	%		1.11	%		2.68	%		1.81	%		1.20	%		1.31	%		1.94	%
Total interest-bearing liabilities		0.26	%		0.26	%		0.26	%		0.26	%		0.26	%		0.26	%		0.28	%

Net interest margin		3.74	%		3.72	%		3.81	%		3.88	%		3.86	%		3.78	%		4.03	%
Net interest margin excluding acquired loans		3.43	%		3.43	%		3.49	%		3.47	%		3.54	%		3.46	%		3.52	%

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 acquired loans, which equals reported net interest income-FTE excluding interest income on acquired loans, annualized, as a percent of average earning assets excluding average acquired loans.

During the fourth quarter of 2015, the net interest margin included $902 thousand of yield maintenance payments on prepaid securities. The net interest margin, excluding acquired loans and the yield maintenance payments on prepaid securities, totaled 3.40% during the fourth quarter of 2015.

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 $2.0 million compared to a net positive ineffectiveness of $61 thousand for the quarters ended December 31, 2015 and 2014, respectively.

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

	Quarter Ended															Years Ended
	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014			12/31/2015			12/31/2014
Mortgage servicing income, net	$	5,126		$	4,906		$	4,696		$	4,897		$	4,814		$	19,625		$	18,619
Change in fair value-MSR from runoff		(2,091	)		(2,636	)		(2,587	)		(2,213	)		(1,999	)		(9,527	)		(8,566	)
Gain on sales of loans, net		4,656			4,479			5,114			3,716			2,910			17,965			10,770
Other, net		(1,433	)		215			206			1,245			132			233			904
Mortgage banking income before hedge ineffectiveness		6,258			6,964			7,429			7,645			5,857			28,296			21,727
Change in fair value-MSR from market changes		2,010			(4,141	)		6,076			(2,368	)		(4,142	)		1,577			(7,203	)
Change in fair value of derivatives		(3,981	)		4,620			(4,024	)		3,688			4,203			303			10,256
Net (negative) positive hedge ineffectiveness		(1,971	)		479			2,052			1,320			61			1,880			3,053
Mortgage banking, net	$	4,287		$	7,443		$	9,481		$	8,965		$	5,918		$	30,176		$	24,780

During the first quarter of 2015, Trustmark exercised its option to repurchase approximately $28.5 million of delinquent loans serviced for GNMA. These loans were subsequently sold to a third party under different repurchase provisions. Trustmark retained the servicing for these loans, which are subject to guarantees by FHA/VA. As a result of this repurchase and sale, the loans are no longer carried as "LHFS-Guaranteed GNMA serviced loans" (see pages 3 and 6). The transaction resulted in a gain of $304 thousand, which was recorded during the first quarter of 2015 and is included in the table above as "Gain on sales of loans, net.”

TRUSTMARK CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIALS

December 31, 2015

($ in thousands)

(unaudited)

Note 5 – Other Noninterest Income and Expense

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

	Quarter Ended															Year Ended
	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014			12/31/2015			12/31/2014
Partnership amortization for tax credit purposes	$	(3,015	)	$	(2,083	)	$	(2,480	)	$	(2,472	)	$	(2,806	)	$	(10,050	)	$	(11,824	)
(Decrease) Increase in FDIC indemnification asset		(827	)		82			(1,798	)		(970	)		(735	)		(3,513	)		(2,874	)
Increase in life insurance cash surrender value		1,667			1,687			1,673			1,675			1,693			6,702			7,340
Other miscellaneous income		1,709			1,784			2,172			712			2,444			6,377			7,972
Total other, net	$	(466	)	$	1,470		$	(433	)	$	(1,055	)	$	596		$	(484	)	$	614

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.

During the fourth quarter of 2015, other noninterest income included a net downward adjustment of the FDIC indemnification asset of $827 thousand on acquired covered loans and covered other real estate obtained from the Heritage Banking Group primarily as a result of decreases in write-downs of covered other real estate when compared to the third quarter of 2015.

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

	Quarter Ended										Year Ended
	12/31/2015		9/30/2015		6/30/2015		3/31/2015		12/31/2014		12/31/2015		12/31/2014
Loan expense	$	3,356	$	3,416	$	3,342	$	2,721	$	3,312	$	12,835	$	12,953
Amortization of intangibles		1,927		1,942		1,959		1,991		2,123		7,819		8,756
Other miscellaneous expense		7,749		6,840		6,885		6,994		8,985		28,468		32,158
Total other expense	$	13,032	$	12,198	$	12,186	$	11,706	$	14,420	$	49,122	$	53,867

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 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, 2015

($ in thousands)

(unaudited)

Note 6 - Non-GAAP Financial Measures (continued)
				Quarter Ended															Year Ended
				12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014			12/31/2015			12/31/2014
TANGIBLE EQUITY
AVERAGE BALANCES
Total shareholders' equity				$	1,481,294		$	1,469,255		$	1,454,501		$	1,436,969		$	1,422,268		$	1,460,650		$	1,398,945
Less:	Goodwill				(365,945	)		(365,500	)		(365,500	)		(365,500	)		(365,500	)		(365,613	)		(367,281	)
	Identifiable intangible assets				(28,851	)		(31,144	)		(30,385	)		(32,398	)		(34,411	)		(30,686	)		(37,651	)
Total average tangible equity				$	1,086,498		$	1,072,611		$	1,058,616		$	1,039,071		$	1,022,357		$	1,064,351		$	994,013

PERIOD END BALANCES
Total shareholders' equity				$	1,473,057		$	1,476,756		$	1,450,409		$	1,446,084		$	1,419,940
Less:	Goodwill				(366,156	)		(365,500	)		(365,500	)		(365,500	)		(365,500	)
	Identifiable intangible assets				(27,546	)		(30,129	)		(32,042	)		(31,250	)		(33,234	)
Total tangible equity			(a)	$	1,079,355		$	1,081,127		$	1,052,867		$	1,049,334		$	1,021,206

TANGIBLE ASSETS
Total assets				$	12,678,896		$	12,390,276		$	12,182,448		$	12,179,164		$	12,250,633
Less:	Goodwill				(366,156	)		(365,500	)		(365,500	)		(365,500	)		(365,500	)
	Identifiable intangible assets				(27,546	)		(30,129	)		(32,042	)		(31,250	)		(33,234	)
Total tangible assets			(b)	$	12,285,194		$	11,994,647		$	11,784,906		$	11,782,414		$	11,851,899

Risk-weighted assets			(c)	$	9,242,902		$	8,831,355		$	8,530,144		$	8,503,102		$	8,387,799

NET INCOME ADJUSTED FOR INTANGIBLE AMORTIZATION
Net income				$	27,858		$	28,430		$	30,602		$	29,148		$	28,073		$	116,038		$	123,562
Plus:	Intangible amortization net of tax				1,191			1,199			1,210			1,229			1,312			4,829			5,410
Net income adjusted for intangible amortization				$	29,049		$	29,629		$	31,812		$	30,377		$	29,385		$	120,867		$	128,972

Period end common shares outstanding			(d)		67,559,128			67,557,395			67,557,395			67,556,591			67,481,992

TANGIBLE COMMON EQUITY MEASUREMENTS
Return on average tangible equity (1)					10.61	%		10.96	%		12.05	%		11.86	%		11.40	%		11.36	%		12.97	%
Tangible equity/tangible assets			(a)/(b)		8.79	%		9.01	%		8.93	%		8.91	%		8.62	%
Tangible equity/risk-weighted assets			(a)/(c)		11.68	%		12.24	%		12.34	%		12.34	%		12.17	%
Tangible book value			(a)/(d)*1,000	$	15.98		$	16.00		$	15.58		$	15.53		$	15.13

TIER 1 COMMON RISK-BASED CAPITAL - BASEL I
Total shareholders' equity																$	1,419,940
Eliminate qualifying AOCI																	42,484
Qualifying tier 1 capital																	60,000
Disallowed goodwill																	(365,500	)
Adj to goodwill allowed for deferred taxes																	15,855
Other disallowed intangibles																	(33,234	)
Disallowed servicing intangible																	(6,436	)
Disallowed deferred taxes																	(3,479	)
Total tier 1 capital																	1,129,630
Less:	Qualifying tier 1 capital																(60,000	)
Total tier 1 common capital			(e)													$	1,069,630

Tier 1 common risk-based capital ratio			(e)/(c)														12.75	%

COMMON EQUITY TIER 1 CAPITAL (CET1) - BASEL III
Total shareholders' equity				$	1,473,057		$	1,476,756		$	1,450,409		$	1,446,084
AOCI-related adjustments					45,394			28,580			41,193			29,652
CET1 adjustments and deductions:
	Goodwill net of associated deferred tax liabilities (DTLs)				(348,873	)		(348,587	)		(348,940	)		(349,292	)
	Other adjustments and deductions for CET1 (2)				(7,980	)		(8,888	)		(9,568	)		(9,104	)
		CET1 capital	(f)		1,161,598			1,147,861			1,133,094			1,117,340
	Additional tier 1 capital instruments plus related surplus				60,000			60,000			60,000			60,000
	Less: additional tier 1 capital deductions				(1,063	)		(1,287	)		(1,571	)		(1,762	)
		Additional tier 1 capital			58,937			58,713			58,429			58,238
		Tier 1 capital		$	1,220,535		$	1,206,574		$	1,191,523		$	1,175,578

Common equity tier 1 capital ratio			(f)/(c)		12.57	%		13.00	%		13.28	%		13.14	%

(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.

Fourth Quarter & Fiscal Year 2015 Financial Results January 26, 2016 Building a Premier Regional Financial Services Organization

Forward–Looking Statements * Certain statements contained in this document constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by words such as “may,” “hope,” “will,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential,” “continue,” “could,” “future” or the negative of those terms or other words of similar meaning. You should read statements that contain these words carefully because they discuss our future expectations or state other “forward-looking” information. These forward-looking statements include, but are not limited to, statements relating to anticipated future operating and financial performance measures, including net interest margin, credit quality, business initiatives, growth opportunities and growth rates, among other things, and encompass any estimate, prediction, expectation, projection, opinion, anticipation, outlook or statement of belief included therein as well as the management assumptions underlying these forward-looking statements. You should be aware that the occurrence of the events described under the caption “Risk Factors” in Trustmark’s filings with the Securities and Exchange Commission could have an adverse effect on our business, results of operations and financial condition. Should one or more of these risks materialize, or should any such underlying assumptions prove to be significantly different, actual results may vary significantly from those anticipated, estimated, projected or expected. Risks that could cause actual results to differ materially from current expectations of Management include, but are not limited to, changes in the level of nonperforming assets and charge-offs, local, state and national economic and market conditions, including 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 as well as 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 issues relating to the European financial system, 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, cyber-attacks and other breaches which could affect our information system security, 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.

Fourth Quarter and 2015 Highlights * Source: Company reports A year of significant achievements; Q4-15 EPS of $0.41 and 2015 EPS of $1.71 At December 31, 2015: Total Assets $12.7 billion Total Loans (HFI & Acquired) $7.5 billion Total Deposits $9.6 billion Banking Centers 200 2015: Net Income $116.0 million EPS – Diluted $1.71 Dividends / Share $0.92 ROATE 11.36% ROAA 0.95% Tangible Equity / Tangible Assets 8.79% Total Risk-Based Capital Ratio 14.07% Profitable Revenue Generation Loans held for investment increased $299.7 million, or 4.4%, from the prior quarter and $641.9 million, or 10.0%, for the year Revenue excluding interest income on acquired loans increased $12.0 million, or 2.4%, in 2015 Net interest income (FTE) excluding acquired loans increased $12.6 million, or 3.7%, during the year Insurance and mortgage banking revenue in 2015 increased 8.8% and 21.8%, respectively Performance of acquired loans continued to exceed expectations, providing capital to support additional growth Process Improvement and Expense Management Routine noninterest expense remained well controlled at $97.2 million, down 1.0% and 1.9% from the prior quarter and year-over-year, respectively Continued realignment of retail delivery channels in 2015 Consolidated eight banking centers and opened three new banking centers Introduced new consumer mobile banking platform, myTrustmark℠ Credit Quality Continued solid credit performance; criticized and classified loan balances declined relative to the prior quarter and comparable period one year earlier Nonperforming assets declined 8.7% linked quarter and 22.9% year-over-year

Total Deposits at December 31, 2015 – $9,588 Source: Company reports (1) Source: FDIC via SNL Financial; data as of 6/30/15 (2) Source: SNL Financial; Peer Group as defined in Trustmark’s 2015 Proxy Statement; data exclude SUSQ which was acquired by BB&T Low-Cost Deposit Base ($ in millions) ($ in millions) Cost of Deposits 0.14% 0.13% 0.13% 0.13% 0.13% Peer Median (2) 0.18% 0.20% 0.20% 0.21% N/A Strength of franchise reflected by market-leadership rankings and low cost of deposits, with nearly 60% of deposits in checking accounts Average deposits in the fourth quarter totaled $9.4 billion; cost of deposits of 13 bps Noninterest-bearing deposits represented 30.1% of average deposits in the fourth quarter Well diversified deposit base serves as an excellent, low-cost source of funds Deposit Mix – Average Balance Deposit Mix by Type – Q4-15 Ending Balance Noninterest-bearing 29% 28% 28% 29% 30% Interest-bearing 71% 72% 72% 71% 70% 31% 28% 16% 18% 7% * Deposit Market Share Rank – Counties (1) Top 3 62% of Served Markets Top 5 75% of Served Markets

Credit Risk Management Source: Company reports Noted: Unless noted otherwise, credit metrics exclude acquired loans and other real estate covered by FDIC loss-share agreement (1) ALL includes allowances for both held for investment and acquired loans; total loans include held for investment and acquired loans ($ in millions) Other Real Estate Allowance for Loan Losses * Continued solid credit performance Dollar Change: ($3) $1 ($7) ($7) 181% ($ in millions) Criticized loan balances declined 8.0% from the prior quarter and 15.8% from the same quarter one year earlier; classified loan balances declined 3.4% linked quarter and 18.6% year-over-year Nonperforming assets decreased $12.6 million, or 8.7%, from the prior quarter and $39.4 million, or 22.9%, year-over-year The linked-quarter and full-year reduction in nonperforming assets was driven by both a reduction in balances of nonaccrual loans and total other real estate Allowance for loan losses represented 210.32% of nonperforming loans, excluding impaired loans Allowance for both held for investment and acquired loan losses represented 1.06% of total loans(1) 206% 193% 207% 210%

$251 or 68% $104 or 20% Source: Company reports $48 or 1% $245 or 25% ($7) or (2%) Loans Held for Investment Portfolio ($ in millions) * Loans held for investment (“HFI”) increased $299.7 million, or 4.4%, to $7.1 billion from the prior quarter; year-over-year, loans HFI increased $641.9 million, or 10.0% Growth in Alabama, Texas, Tennessee and Mississippi, was partially offset by nominal reductions in Florida Linked-quarter increase in construction, land development and other land loans was primarily driven by growth in construction loans Total energy sector exposure of $415.7 million with outstanding balances of $212.6 million at December 31, 2015 Trustmark has no loan exposure in which the source of repayment or the underlying security of such exposure is tied to the realization of value from energy reserves No nonperforming or nonaccrual energy loans as of December 31, 2015 Maintaining share in legacy markets, while expanding in higher-growth markets Loans HFI by Region ($ in millions) $4,271 Loans HFI by Type

Performance of acquired loans Source: Company reports ($ in millions) Acquired Loan Portfolio Acquired Loans Acquired loan yield in the fourth quarter totaled 11.74% and included recoveries from settlement of debt of $5.4 million, which represented approximately 5.33% of the total yield on acquired loans We expect the yield on acquired loans (excl. recoveries) for the first quarter to be in the 5.5% - 6.5% range, reflecting our most recent re-estimation of cash flows Based upon most recent cash flow analyses, acquired loan balances (excl. any settlement of debt) are anticipated to decline approximately $25 to $30 million during the first quarter Accretable Yield ($ in millions) Dollar Change: ($51) ($32) Interest Income & Impairment – Acquired Loans (1) Net interest income on acquired loans - Provision for acquired loan losses * ($47) ($29) ($ in thousands) Dollar Change: ($7) ($6) ($8) ($3)

Income Statement Highlights – Revenue Linked-quarter growth in net interest income (FTE) offset by seasonal reductions in noninterest income Net Interest Income – FTE Net Interest Margin Noninterest Income ($ in millions) * Net Interest Income on Acq. Loans Net Interest Income (excl. Acq. Loans) Source: Company reports Note: n/m – percentage changes greater than + / - 100% are considered not meaningful (1) Net interest margin, excluding acquired loans and yield maintenance payments, totaled 3.46% (2) Net interest margin, excluding acquired loans and yield maintenance payments, totaled 3.40% (1) ($ in millions) Net interest income (FTE) excluding acquired loans in the fourth quarter totaled $92.2 million, up 2.4% from the prior quarter and 3.0% year-over-year Insurance revenue in the fourth quarter increased 8.6% year-over-year Mortgage banking revenue excluding the net hedge ineffectiveness in the fourth quarter increased 6.8% from the comparable period one year earlier Other, net decreased from the prior quarter primarily because of partnership amortization of an additional tax credit investment and FDIC indemnification asset write-downs (2)

Income Statement Highlights – Noninterest Expense Source: Company reports (1) Total does not foot due to rounding Routine noninterest expense remained well-controlled Excluding ORE and intangible amortization of $1.4 million, noninterest expense in the fourth quarter totaled $97.2 million, a decrease of 1.0% from the prior quarter and 1.9% year-over-year Stable routine noninterest expense partially reflects the re-allocation of cost savings achieved throughout the year into revenue-generating areas of the corporation Salaries and benefits declined from the prior quarter because of decreased insurance and mortgage-production commissions ORE and foreclosure expense improved from the prior quarter and provided an income benefit because of gains realized on the sale of real estate Continued optimization of branch network in 2015 – consolidated eight branch offices and opened three new branch offices Noninterest Expense ($ in millions) * Full-time Equivalent Employees (actual figures presented) Noninterest Expense (excl. ORE and Intangible Amortization) ORE/Intangible Amortization (1)

Capital Management Source: Company reports Tangible equity to tangible assets ratio was 8.79%, while the total risk-based capital ratio was 14.07% in the fourth quarter Linked-quarter reduction in capital ratios principally reflects solid loan growth achieved during the quarter Solid capital base continues to provide the flexibility to support strategic growth initiatives Solid capital position reflects consistent profitability of diversified financial services businesses and provides the flexibility to support additional growth * Tangible Equity / Tangible Assets Tier 1 Common Risk-based Capital Ratio Total Risk-based Capital Ratio

Profitable revenue generation Create and expand customer relationships Loan growth Noninterest income – deposit services, wealth management, insurance and mortgage banking Business development and cross-selling Process improvement and expense management Performance Measurement Market Optimization Capital and Expense Management Leverage existing infrastructure investments Enterprise-wide analytics system Network operations center Cybersecurity and fraud detection system Strategic Priorities to Enhance Shareholder Value * Credit quality Maintain disciplined underwriting and pricing Resolution of existing problem assets Effective risk management Ensure regulatory compliance Create value-added proposition, while managing businesses more effectively Mergers and acquisitions In-market consolidation Expand to additional attractive markets Patience and discipline

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