TRUSTMARK CORP
For the period ended Mar 31, 2025. Filed May 6, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 6, 2025
TRMK$44.64-0.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-05.
0000950170-24-121533
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-06.
0000950170-25-064530
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 235 previous paragraphs and 224 current paragraphs.
126 unchanged; 80 reworded; 18 added; 28 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 27 previous and 23 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
Consumer spending was lower on balance, with reports of solid demand for essential goods mixed with increased price sensitivity for discretionary items, particularly among lower-income shoppers. Most Districts saw moderate to robust sales of vehicles and of some nondurables, generally attributed to a rush to purchase ahead of tariff-related price increases. Both leisure and business travel were down on balance, with several Districts noting a decline in international visitors. Manufacturing activity was mixed, with a majority of Districts reporting slight to modest increases in the February 2025 report and two-thirds of Districts reporting manufacturing activity was little changed or had declined in the April 2025 report. Contacts in manufacturing expressed concerns over the potential impact of looming trade policy changes.
Current report
Residential real estate markets were mixed with reports pointing to ongoing inventory constraints. Construction activity declined modestly for both residential and nonresidential units. Some contacts in the sector also expressed nervousness around the impact of potential tariffs on the price of lumber and other materials. Commercial real estate activity expanded slightly as multifamily propped up the industrial and office sectors.
Current report
Banking activity was slightly higher on balance among reporting Districts. The energy sector experienced modest growth. Agricultural conditions among reporting Districts were stable to slightly deteriorated. Cuts to federal grants and subsidies along with declines in philanthropic donations caused gaps in services provided by many community organizations. Expectations for economic activity over the coming months in several Districts worsened considerably as economic uncertainty, particularly surrounding tariffs, rose.
Current report
Employment was slightly higher on balance. Multiple Districts cited job growth in healthcare and finance, while employment declines were reported in manufacturing and information technology. Hiring was generally slower for consumer-facing firms than for business-to-business firms. The most notable declines in headcount were in government roles or roles at organizations receiving government funding. Several Districts reported that firms were taking a wait-and-see approach to employment, pausing or slowing hiring until there is more clarity on economic conditions. Labor availability improved for many sectors and Districts, although there were some reports of constraints on labor supply resulting from shifting immigration policies in certain sectors and regions. Wages grew at a modest-to-moderate pace, with several Districts noting that wage pressures were easing.
Current report
Prices increased at a modest-to-moderate pace in most Districts, with several Districts reporting an uptick in the pace of increase relative to previous reports. Input price pressures were generally greater than sales price pressures, particularly in manufacturing and construction. Most Districts noted that firms expected elevated input cost growth resulting from tariffs, with many firms already receiving notices from suppliers that costs would be increasing. Firms reported adding tariff surcharges or shortening pricing horizons to account for uncertain trade policy. Many Districts noted that higher prices for eggs and other food ingredients were impacting food processors and restaurants. Reports of substantial increases in insurance and freight transportation costs were also widespread. Most businesses expected to pass through additional costs to customers; however, there were reports about margin compression amid increased costs, as demand remained tepid in some sectors, especially for consumer-facing firms.
Current report
Reports by the Federal Reserve’s Sixth District, Atlanta (which includes Trustmark’s Alabama, Florida, Georgia and Mississippi market regions), Eighth District, St. Louis (which includes Trustmark’s Tennessee market region), and Eleventh District, Dallas (which includes Trustmark’s Texas market region), noted similar findings for the reporting period as those discussed above. The Federal Reserve’s Sixth District also noted a slight decline in housing demand as mortgage rates ticked up and affordability declined. The Federal Reserve's Sixth District reported moderate loan growth across most major lending categories, with multifamily lending outpacing other categories, asset quality remained stable overall with low levels of nonperforming loans as a percentage of total loans, customer creditworthiness remained solid, and both deposit balances and borrowings by banks increased modestly, though loan growth outpaced growth of deposits increasing loan-to-deposit ratios. The Federal Reserve’s Eighth District reported that banking activity remained steady, with some increased optimism across contacts due to expected regulatory changes and net interest margin improvement. The Federal Reserve’s Eighth District also reported that loan demand remained flat, consumer past-due accounts continued to rise, though the exposure was staying at 60 days or less and a slight increase in small business bankruptcies and past dues; however, despite a few pockets of concern, bankers reported credit portfolios were strong. The Federal Reserve’s Eleventh District reported that loan volume and loan demand continued increasing at a rapid pace during the February 2025 reporting period but decelerated sharply in March 2025, credit tightening continued, while loan pricing declined, and loan nonperformance rose across all loan types, while growth in general business activity slowed. The Federal Reserve’s Eleventh District also noted that bankers' outlooks were cautiously optimistic with expectations of improvements in loan demand and business activity tempered by expectations of a continued increase in loan nonperformance, and citing net interest margin, liquidity and cybersecurity as top outlook concerns.
Current report
Trustmark is intently monitoring the impact of tariffs and other administrative policies on its customer base, interest rates and credit-related issues. Although there has been no immediate impact to Trustmark’s financial condition or results of operations, economic uncertainty or disruptions in the marketplace, as a result of such policies, could reduce loan demand or increase loan nonperformance. It is not possible to predict the timing or magnitude of changes to policies by the current United States presidential administration, if any, or the impact any such policy changes could have on Trustmark's customer base, credit quality or results of operations.
Current report
Noninterest income (loss) for the three months ended March 31, 2025 totaled $42.6 million, an increase of $3.2 million, or 8.2%, when compared to the same time period in 2024 principally due to an increase in other, net. Other, net totaled $6.0 million for the three months ended March 31, 2025, an increase of $2.9 million, or 92.5%, when compared to the same time period in 2024, principally due to a $2.4 million gain on the sale of a bank property during the first quarter of 2025 as well as a gain in income from other partnership investments.
Current report
Noninterest expense for the three months ended March 31, 2025 totaled $124.0 million, an increase of $4.3 million, or 3.6%, when compared to the same time period in 2024, principally due to increases in salaries and employee benefits and services and fees. Salaries and employee benefits totaled $68.5 million for the three months ended March 31, 2025, an increase of $3.0 million, or 4.6%, when compared to the same time period in 2024, primarily due to increases in medical insurance expense, salaries expense principally due to general merit increases, commissions related to mortgage originations and annual incentive compensation. Services and fees totaled $26.2 million for the three months ended March 31, 2025, an increase of $1.8 million, or 7.4%, when compared to the same time period in 2024, principally due to increases in data processing expenses related to software, advertising expense, legal expense, and business process operations outsourcing expense.
Current report
On October 24, 2023, the federal banking agencies released a final rule significantly revising the framework that the agencies use to evaluate banks’ records of meeting the credit needs of their entire communities under the Community Reinvestment Act (CRA). On March 28, 2025, the agencies announced their intent to issue a proposal to rescind the October 2023 final rule, and to reinstate the CRA framework that existed prior to the October 2023 final rule. TNB received a rating of “Outstanding” in its most recent CRA performance evaluation, which was conducted using the CRA framework that existed prior to the October 2023 final rule.
Current report
Interest expense for the three months ended March 31, 2025 totaled $77.1 million, a decrease of $19.9 million, or 20.5%, when compared with the same time period in 2024, while the rate on total interest-bearing liabilities decreased 49 basis points to 2.43%, reflecting declines in all categories of interest expense. Interest on deposits for the three months ended March 31, 2025 decreased $16.0 million, or 19.1%, while the rate on interest-bearing deposits decreased 44 basis points to 2.30% when compared to the same time period in 2024, primarily due to declines in public interest checking and brokered deposits as well as a decline in rates on interest-bearing deposits. Other interest expense for the three months ended March 31, 2025 decreased $2.6 million, or 34.1%, while the rate on other borrowings decreased 89 basis points to 3.89% when compared to the same time period in 2024, primarily due to the decrease in average outstanding short-term FHLB advances with the FHLB of Dallas. Interest expense on federal funds purchased and securities sold under repurchase agreements for the three months ended March 31, 2025 totaled $4.3 million, a decrease of $1.3 million, or 23.1%, while the rate on federal funds purchased and securities sold under repurchase agreements decreased 95 basis points to 4.30% when compared to the same time period in 2024, reflecting a decrease in the target rate on federal funds purchased by the FRB.
Current report
n/m - percentage changes greater than +/- 100% are not considered meaningful
Current report
n/m - percentage changes greater than +/- 100% are not considered meaningful
Current report
The increase in other, net when the three months ended March 31, 2025 is compared to the same time period in 2024, principally due to a $2.4 million gain on the sale of a bank property during the first quarter of 2025 as well as a gain in income from other partnership investments.
Current report
Trustmark’s historical data to develop a PD based on the credit score ranges initially set up. Additionally, Management elected to use the same LGD value from the mortgage sale that occurred in the second quarter of 2024 along with the same weighted average life assumption utilized to determine the credit mark on this portfolio.
Current report
The decrease in net charge-offs when the three months ended March 31, 2025 is compared to the same time period in 2024 was principally due to a commercial credit in the Texas market region that was charged off during the first quarter of 2024.
Current report
The PCL, LHFI for the three months ended March 31, 2025 totaled 0.25% of average loans (LHFS and LHFI) compared to 0.24% of average loans (LHFS and LHFI) for the same time period in 2024. The PCL, LHFI for the three months ended March 31, 2025 primarily reflected increases in required reserves as a result of updates to qualitative reserve factors, credit migration, changes in macroeconomic forecasts and loan growth.
Current report
Other borrowings totaled $404.8 million at March 31, 2025, an increase of $103.3 million, or 34.2%, when compared with $301.5 million at December 31, 2024, principally due to an increase in outstanding short-term FHLB advances with the FHLB of Dallas.
Removed paragraphs (28)
Previous report
Most Districts reported declining manufacturing activity. Activity in the banking sector was generally steady to up slightly and loan demand was mixed, with some Districts noting improvement in the outlook due to the recent decline in interest rates. Reports on consumer spending were mixed, with some Districts noting shifts in the composition of purchases, mostly towards less expensive alternatives.
Previous report
The housing market activity was generally steady as inventory continued to expand in much of the nation and home values largely held steady or rose slightly. Uncertainty about the path of mortgage rates kept some buyers on the sidelines and the lack of affordable housing remained a persistent problem in many communities. Commercial real estate markets were generally flat.
Previous report
The short-lived dockworkers strike caused only minor temporary disruptions. Hurricane damage impacted crops and prompted pauses in business activity and tourism in the Southeast. Agricultural activity was flat to down modestly, with some crop prices remaining unprofitably low. Energy activity was also unchanged or down modestly and lower energy prices compressed producers' margins. Despite elevated uncertainty, contacts were somewhat more optimistic about the longer-term outlook.
Previous report
Employment activity increased slightly during the reporting period, with more than half of the Districts reporting slight or modest growth and the remaining Districts reporting little or no change. Demand for workers eased somewhat and worker availability improved. However, contacts noted that it remained difficult to find workers with certain skills or for certain industries, such as technology, manufacturing and construction. Wages generally continued to rise at a modest to moderate pace. Contacts in multiple Districts pointed to a slowdown in the pace of wage increases as a result of improvements in worker availability. Larger than usual pay increases were still reported for some workers, such as those in the skilled trades or in remote areas.
Previous report
Inflation continued to moderate with selling prices reportedly increasing at a slight to modest pace in most Districts. Home prices edged up in many Districts, while rents were reported to be steady or down slightly. Many Districts noted increasing price sensitivity among consumers. Input prices generally rose moderately. Several industries noted more acute pressures from rising insurance and healthcare costs. Multiple Districts reported that input prices generally rose faster than selling prices, compressing firms profit margins.
Previous report
Reports by the Federal Reserve’s Sixth District, Atlanta (which includes Trustmark’s Alabama, Florida, Georgia and Mississippi market regions), Eighth District, St. Louis (which includes Trustmark’s Tennessee market region), and Eleventh District, Dallas (which includes Trustmark’s Texas market region), noted similar findings for the reporting period as those discussed above. The Federal Reserve’s Sixth District also noted that although loan growth was modest, financial institutions noted anticipating additional future loan demand in a lower rate environment and multifamily lending increased moderately as the demand for housing continued to exceed supply. The Federal Reserve’s Sixth District reported that deposits, including large time deposits, increased modestly, borrowings continued to decline as banks reduced reliance on more expensive sources of funding, and rising cash balances drove increasing cash-to-assets ratios at District institutions and across the industry broadly. The Federal Reserve’s Eighth District also noted that banks were able to adjust deposit rates downward without receiving much pushback from customers, past-due credit card payments increased but bankers' credit quality forecasts continued to be favorable and bankers reported positive moves in their capital and balance sheets due to favorable changes in bond values. The Federal Reserve’s Eleventh District reported that credit tightening continued and loan nonperformance rose but at a slower pace, there was a notable uptick in concern for the performance of office commercial real estate loans, and bankers reported working with borrowers to keep commercial real estate loans in good standing prior to maturity when they can be refinanced. The Federal Reserve’s Eleventh District also noted that despite increased concerns, bankers' outlooks turned sharply optimistic and contacts expect a significant improvement in loan demand and business activity six months from now, although they still anticipate continued deterioration in loan performance.
Previous report
Net interest income for the three and nine months ended September 30, 2024 totaled $154.7 million and $428.6 million, respectively, an increase of $16.1 million, or 11.6%, and $12.4 million, or 3.0%, respectively, when compared to the same time periods in 2023, principally attributable to increases in interest and fees from LHFS and LHFI and interest on securities as well as a decline in other interest expense, partially offset by an increase in interest expense on deposits. Interest income totaled $251.6 million and $720.6 million for the three and nine months ended September 30, 2024, respectively, an increase of $23.1 million, or 10.1%, and $74.6 million, or 11.6%, respectively, when compared to the same time periods in 2023, principally due to increases in interest and fees on LHFS and LHFI, primarily as a result of the higher interest rate environment and loan growth, and interest on securities, primarily as a result of restructuring the securities portfolio during the second quarter of 2024. Interest expense totaled $96.9 million and $292.0 million for the three and nine months ended September 30, 2024, respectively, an increase of $7.0 million, or 7.8%, and $62.2 million, or 27.1%, respectively, when compared to the same time periods in 2023. The increase in interest expense when the three and nine months ended September 30, 2024 are compared to the same time periods in 2023 was principally due to an increase in interest on deposits primarily due to rising interest rates, increased competition for deposits and higher average balances, partially offset by a decrease in other interest expense primarily due to a decrease in short-term Federal Home Loan Bank (FHLB) advances.
Previous report
Noninterest income (loss) for the three and nine months ended September 30, 2024 totaled $37.6 million and a negative $64.4 million, respectively, an increase of $641 thousand, or 1.7%, and a decrease of $176.2 million, respectively, when compared to the same time periods in 2023. The decrease in noninterest income (loss) when the first nine months of 2024 is compared to the same time period in 2023 was primarily due to the $182.8 million loss on the sale of the available for sale securities during the second quarter of 2024, partially offset by an increase in other, net. Other, net totaled $13.5 million for the nine months ended September 30, 2024, an increase of $5.9 million, or 76.6%, when compared to the same time period in 2023, principally due to the $8.1 million Visa C shares fair value adjustment during the second quarter of 2024 as well as an increase in cash management service fees, partially offset by the $4.8 million noncredit-related loss on the sale of 1-4 family mortgage loans recorded during the second quarter of 2024.
Previous report
Noninterest expense for the three and nine months ended September 30, 2024 totaled $123.3 million and $361.3 million, respectively, a decrease of $7.0 million, or 5.4%, and $8.2 million, or 2.2%, respectively, when compared to the same time periods in 2023. The decrease in noninterest expense for the three months ended September 30, 2024 was principally due to the $6.5 million litigation settlement expense recorded during the third quarter of 2023 as well as a decline in services and fees partially offset by an increase in other expense. The decrease in noninterest expense for the nine months ended September 30, 2024 was principally due to the $6.5 million litigation settlement expense recorded during the third quarter of 2023 as well as declines in services and fees and salaries and employee benefits partially offset by an increase in other expense. Services and fees for the three and nine months ended September 30, 2024 totaled $25.7 million and $74.9 million, respectively, a decrease of $1.7 million, or 6.4%, and $5.4 million, or 6.8%, respectively, when compared to the same time periods in 2023, principally due to declines in outside services and fees, primarily related to other services and fees and legal expense, communication expense, primarily related to telephone expense, and advertising expense, partially offset by an increase in data processing expenses related to software. Salaries and employee benefits totaled $197.0 million for the nine months ended September 30, 2024, a decrease of $1.9 million, or 1.0%, when compared to the same time period in 2023, principally due to declines in commissions related to mortgage production, other salaries expense and medical insurance expense, partially offset by an increase in salaries expense primarily due to general merit increases. Other expense totaled $17.3 million and $48.7 million for the three and nine months ended September 30, 2024, respectively, an increase of $2.3 million, or 15.1%, and $5.7 million, or 13.3%, respectively, when compared to the same time periods in 2023. The increase in other expense when the three and nine months ended September 30, 2024 are compared to the same time periods in 2023 was principally due to increases in FDIC assessment expense, primarily due to an increase in the assessment rate, and other real estate expense, net, primarily attributable to a reserve for other real estate write-down recorded for one foreclosed property in the Texas market region which was under contract to be sold during the fourth quarter of 2024.
Previous report
Trustmark’s total PCL on LHFI for the three months ended September 30, 2024 totaled $7.9 million, a decrease of $399 thousand, or 4.8%, when compared to the same time period in 2023. The PCL, LHFI for the three months ended September 30, 2024 primarily reflected increases in required reserves related to individually analyzed LHFI and the implementation of the External Factor-Credit Quality Review qualitative factor, partially offset by declines in required reserves resulting from the update of the macroeconomic forecasts and net changes in other qualitative reserve factors. During the third quarter of 2024, Trustmark activated the External Factor – Credit Quality Review qualitative factor to ensure reserve adequacy for collectively evaluated commercial loans that may not have been identified and downgraded timely for various reasons. Please see the section captioned “Allowance for Credit Losses: LHFI” for additional information regarding the External Factor-Credit Quality Review qualitative factor. The PCL, LHFI for the nine months ended September 30, 2024 totaled $39.0 million and included a $8.6 million PCL, LHFI sale of 1-4 family mortgage loans for the credit-related portion of the loss on the sale of the 1-4 family mortgage loans. The PCL, LHFI, excluding the PCL, LHFI sale of 1-4 family mortgage loans, for the nine months ended September 30, 2024 totaled $30.3 million, compared to $19.8 million for the same time period in 2023. The PCL on LHFI, excluding the PCL, LHFI 1-4 family mortgage loans, for the nine months ended September 30, 2024 primarily reflected an increase in required reserves as a result of net adjustments to the qualitative factors due to credit migration, implementation of the External Factor-Credit Quality Review qualitative factor, and specific reserves for individually analyzed LHFI, partially offset by net changes in the macroeconomic forecast associated with specific loss driver models as a result of loss driver updates and net changes in other qualitative reserve factors.
Previous report
On September 17, 2024, the FDIC finalized changes to its Statement of Policy on Bank Merger Transactions (Policy Statement), which outlines factors that the FDIC will consider when evaluating a proposed bank merger transaction. Also on September 17, 2024, the United States Department of Justice (DOJ) withdrew its 1995 Bank Merger Guidelines and announced that it will instead evaluate the competitive impact of bank mergers using its 2023 Merger Guidelines that the DOJ applies to mergers in all industries. Compared to the 1995 Bank Merger Guidelines, the 2023 Merger Guidelines set forth more stringent concentration limits and add several largely qualitative bases on which the DOJ may challenge a merger. While the effect of these changes for particular transactions remains unclear, both the Policy Statement and the change in the DOJ’s bank merger antitrust policy may make it more difficult and/or costly for banks to obtain regulatory approval for an acquisition or otherwise result in more onerous conditions to obtain approval for an acquisition.
Previous report
Trustmark discloses certain non-GAAP financial measures, including net income adjusted for significant non-routine transactions, because Management uses these measures for business planning purposes, including to manage Trustmark’s business against internal projected results of operations and to measure Trustmark’s performance. Trustmark views these as measures of its core operating business, which exclude the impact of the items detailed below, as these items are generally not operational in nature. These non-GAAP financial measures also provide another basis for comparing period-to-period results as presented in the accompanying selected financial data table and the consolidated financial statements by excluding potential differences caused by non-operational and unusual or non-recurring items. Readers are cautioned that these adjustments are not permitted under GAAP. Trustmark encourages readers to consider its consolidated financial statements and the notes related thereto in their entirety, and not to rely on any single financial measure.
Previous report
Trustmark completed the following significant non-routine transactions during the second quarter of 2024, which are included in the financial results for the nine months ended September 30, 2024:
Previous report
On May 31, 2024, TNB closed the sale of its wholly owned subsidiary, Fisher Brown Bottrell Insurance, Inc., (FBBI) to Marsh & McLennan Agency LLC, consistent with the terms as previously announced on April 23, 2024. Trustmark recognized a net gain on the sale of $228.3 million ($171.2 million, net of taxes) in income from discontinued operations. The operations of FBBI prior to the sale are included in income from discontinued operations for the current and prior periods.
Previous report
Trustmark restructured its investment securities portfolio by selling $1.561 billion of available for sale securities with an average yield of 1.36%, which generated a loss of $182.8 million ($137.1 million, net of taxes) and was recorded to noninterest income (loss) in security gains (losses), net. Trustmark also purchased $1.378 billion of available for sale securities with an average yield of 4.85%.
Previous report
Trustmark sold a portfolio of 1-4 family mortgage loans that were at least three payments delinquent and/or nonaccrual at the time of selection totaling $56.2 million, which resulted in a loss of $13.4 million ($10.1 million, net of taxes). The portion of the loss related to credit totaled $8.6 million ($6.5 million, net of taxes) and was recorded as adjustments to charge-offs and the provision for credit losses (PCL). The noncredit-related portion of the loss totaled $4.8 million ($3.6 million, net of taxes) and was recorded to noninterest income (loss) in other, net.
Previous report
On April 8, 2024, Visa commenced an initial exchange offer expiring on May 3, 2024, for any and all outstanding shares of Visa Class B-1 common stock (Visa B-1 shares). Holders participating in the exchange offer would receive a combination of Visa Class B-2 common stock (Visa B-2 shares) and Visa Class C common stock (Visa C shares) in exchange for Visa B-1 shares that were validly tendered and accepted for exchange by Visa. TNB tendered its 38.7 thousand Visa B-1 shares, which were accepted by Visa. In exchange for each Visa B-1 share that was validly tendered and accepted for exchange by Visa, TNB received 50.0% of a newly issued Visa B-2 share and newly issued Visa C shares equivalent in value to 50.0% of a Visa B-1 share. The Visa C shares that were received by TNB were recognized at fair value, which resulted in a gain of $8.1 million ($6.0 million, net of taxes) and was recorded to noninterest income (loss) in other, net during the second quarter of 2024. During the third quarter of 2024, TNB sold all of the Visa C shares for approximately the same carrying value as of June 30, 2024. The Visa B-2 shares were recorded at their nominal carrying value.
Previous report
The following table presents adjustments to net income and selected financial ratios as reported in accordance with GAAP resulting from significant non-routine items occurring during the periods presented ($ in thousands, except per share data):
Previous report
Interest expense for the three and nine months ended September 30, 2024 totaled $96.9 million and $292.0 million, respectively, an increase of $7.0 million, or 7.8%, and $62.2 million, or 27.1%, respectively, when compared with the same time periods in 2023, while the rate on total interest-bearing liabilities increased 22 basis points and 56 basis points, respectively, to 2.94%, principally due to an increase in interest on deposits partially offset by a decline in other interest expense. Interest on deposits for the three and nine months ended September 30, 2024 increased $16.2 million, or 23.3%, and $88.3 million, or 53.5%, respectively, while the rate on interest-bearing deposits increased 42 basis points to 2.81% and 80 basis points to 2.77%, respectively, when compared to the same time periods in 2023, primarily due to higher interest rates, reflecting the increased competitive pressures on deposits, and increases in average balances of time deposits and MMDA accounts. Other interest expense for the three and nine months ended September 30, 2024 decreased $8.7 million, or 59.4%, and $27.2 million, or 54.8%, respectively, while the rate on other borrowings decreased 79 basis points to 4.53% and 35 basis points to 4.75%, respectively, when compared to the same time periods in 2023, primarily due to the decrease in outstanding short-term FHLB advances with the FHLB of Dallas.
Previous report
The increase in other, net when the nine months ended September 30, 2024 is compared to the same time period in 2023, was principally due to the $8.1 million Visa C shares fair value adjustment during the second quarter of 2024 as well as an increase in cash management service fees, partially offset by the $4.8 million noncredit-related loss on the sale of 1-4 family mortgage loans recorded during the second quarter of 2024.
Previous report
The increase in other expense when the three and nine months ended September 30, 2024 is compared to the same time period in 2023 was principally due to increases in FDIC assessment expense, primarily due to an increase in the assessment rate, and other real estate expense, net, primarily attributable to a reserve for other real estate write-down recorded for one foreclosed property in the Texas market region which was under contract to be sold during the fourth quarter of 2024. The increase in FDIC assessment rate was principally due to increases in the overall assessment rate and the 2-basis point increase in the initial base assessment rate by the FDIC during the second quarter of 2023 as part of the FDIC's final rule to restore the DIF to required levels.
Previous report
Not rated securities primarily consist of Mississippi municipal general obligations.
Previous report
The increase in net charge-offs when the three months ended September 30, 2024 is compared to the same time period in 2023 was principally due to an increase in gross charge-offs in the Alabama market region, primarily related to one large nonaccrual commercial credit, and a decline in recoveries in the Tennessee market region, partially offset by a decrease in gross charge-offs in the Texas market region. The increase in net charge-offs when the nine months ended September 30, 2024, is compared to the same time period in 2023 was principally due to the charge-offs related to the sale of 1-4 family mortgage loans during the second quarter of 2024 and an increase in gross charge-offs in the Alabama and Texas market regions, primarily related to two large nonaccrual commercial credits, as well as a decline in recoveries in the Tennessee market region.
Previous report
The PCL, LHFI, excluding the PCL, LHFI 1-4 family mortgage loans, for the three and nine months ended September 30, 2024 totaled 0.24% and 0.30%, respectively, of average loans (LHFS and LHFI) compared to 0.26% and 0.21%, respectively, of average loans (LHFS and LHFI) for the same time periods in 2023. The PCL on LHFI, excluding the PCL, LHFI sale of 1-4 family mortgage loans, for the three months ended September 30, 2024 primarily reflected increases in required reserves related to individually analyzed LHFI and the implementation of the External Factor-Credit Quality Review qualitative factor, partially offset by declines in required reserves resulting from the update of the macroeconomic forecasts and net changes in other qualitative reserve factors. The PCL on LHFI, excluding the PCL, LHFI 1-4 family mortgage loans, for the nine months ended September 30, 2024 primarily reflected an increase in required reserves as a result of net adjustments to the qualitative factors due to credit migration, implementation of the External Factor-Credit Quality Review qualitative factor, and specific reserves for individually analyzed LHFI, partially offset by net changes in the macroeconomic forecast associated with specific loss driver models as a result of loss driver updates and net changes in other qualitative reserve factors.
Previous report
At September 30, 2024, nonaccrual LHFI totaled $73.8 million, or 0.55% of total LHFS and LHFI, reflecting a decrease of $26.2 million, or 26.2%, relative to December 31, 2023. The decrease in nonaccrual LHFI during the first nine months of 2024 was primarily as a result of the sale of 1-4 family mortgage loans during the second quarter of 2024 as well as the resolution of two large nonaccrual commercial credits in the Texas and Alabama market regions, partially offset by three large commercial credits placed on nonaccrual in the Alabama and Texas market regions.
Previous report
Other borrowings totaled $443.5 million at September 30, 2024, a decrease of $39.8 million, or 8.2%, when compared with $483.2 million at December 31, 2023, principally due to a decline in outstanding short-term FHLB advances with the FHLB of Dallas.
Previous report
In addition, at September 30, 2024, Trustmark had no short-term or long-term FHLB advances outstanding with the FHLB of Atlanta compared to no short-term and $58 thousand in long-term FHLB advances at December 31, 2023, which were acquired in the BancTrust merger in 2013. Trustmark had non-member status and thus no additional borrowing capacity with the FHLB of Atlanta.
Previous report
Following the LIBOR cessation date of June 30, 2023, the nationwide process for replacing LIBOR in financial contracts that mature thereafter and that do not provide for an effective means to replace LIBOR upon its cessation took effect pursuant to the Adjustable Interest Rate (LIBOR) Act. For contracts in which a party has the discretion to identify a replacement rate, the Adjustable Interest Rate (LIBOR) Act also provides a safe harbor to parties if they choose the SOFR-based benchmark replacement rate to be identified by the FRB. Trustmark had a significant number of loans, derivative contracts, borrowings and other financial instruments with attributes that were either directly or indirectly dependent on LIBOR. As of September 30, 2024, all of Trustmark’s LIBOR exposure was remediated or in the process of being remediated. The transition from LIBOR could create costs and additional risk. Trustmark cannot predict what the ultimate impact of the transition from LIBOR will be; however, Trustmark has implemented various measures to manage the transition and mitigate risks. For additional information regarding the transition from LIBOR and Trustmark’s management of this transition, please see the respective risk factor included in Part I. Item 1A. – Risk Factors, of Trustmark’s 2023 Annual Report.
Reworded paragraphs (80)
Previous wording
Trustmark, a Mississippi business corporation incorporated in 1968, is a bank holding company headquartered in Jackson, Mississippi. Trustmark’s principal subsidiary is Trustmark National Bank (TNB), initially chartered by the State of Mississippi in 1889. At September 30, 2024, TNB had total assets of $18.478 billion, which represented approximately 99.99% of the consolidated assets of Trustmark.
Current wording
Trustmark, a Mississippi business corporation incorporated in 1968, is a bank holding company headquartered in Jackson, Mississippi. Trustmark’s principal subsidiary is Trustmark National Bank (TNB), initially chartered by the State of Mississippi in 1889. At March 31, 2025, TNB had total assets of $18.294 billion, which represented approximately 99.99% of the consolidated assets of Trustmark.
Previous wording
Through TNB and its other subsidiaries, Trustmark operates as a financial services organization providing banking and other financial solutions through offices and 2,500 full-time equivalent associates (measured at September 30, 2024) located in the states of Alabama, Florida (primarily in the northwest or “Panhandle” region of that state, which is referred to herein as Trustmark’s Florida market), Georgia (primarily in Atlanta, which is referred to herein as Trustmark's Georgia market), Mississippi, Tennessee (in the Memphis and Northern Mississippi regions, which are collectively referred to herein as Trustmark’s Tennessee market), and Texas (primarily in Houston, which is referred to herein as Trustmark’s Texas market). Trustmark’s operations are managed along two operating segments: General Banking Segment and Wealth Management Segment. For a complete overview of Trustmark’s business, see the section captioned “The Corporation” included in Part I. Item 1. – Business of Trustmark’s Annual Report on Form 10-K for its fiscal year ended December 31, 2023 (2023 Annual Report).
Current wording
Through TNB and its other subsidiaries, Trustmark operates as a financial services organization providing banking and other financial solutions through offices and 2,506 full-time equivalent associates (measured at March 31, 2025) located in the states of Alabama, Florida (primarily in the northwest or “Panhandle” region of that state, which is referred to herein as Trustmark’s Florida market), Georgia (primarily in Atlanta, which is referred to herein as Trustmark's Georgia market), Mississippi, Tennessee (in the Memphis and Northern Mississippi regions, which are collectively referred to herein as Trustmark’s Tennessee market), and Texas (primarily in Houston, which is referred to herein as Trustmark’s Texas market). Trustmark’s operations are managed along two operating segments: General Banking Segment and Wealth Management Segment. For a complete overview of Trustmark’s business, see the section captioned “The Corporation” included in Part I. Item 1. – Business of Trustmark’s Annual Report on Form 10-K for its fiscal year ended December 31, 2024 (2024 Annual Report).
Previous wording
In addition to the significant non-routine transactions that were completed during the second quarter of 2024, Trustmark's financial results for the first nine months of 2024 reflected continued growth in loans held for investment (LHFI), an increase in noninterest income and disciplined expense management. Please see the section captioned "Non-GAAP Financial Measures" for additional information regarding the significant non-routine transactions. Trustmark's capital position remained solid, reflecting the consistent profitability of its diversified financial services businesses. These accomplishments are the result of focused efforts to enhance Trustmark's long-term performance and competitiveness. Trustmark continues to implement technology and streamline processes to enhance its ability to grow and serve customers. Trustmark is well-positioned to compete in changing economic conditions and create long-term value for its shareholders. Trustmark’s Board of Directors declared a quarterly cash dividend of $0.23 per share. The dividend is payable December 15, 2024, to shareholders of record on December 1, 2024.
Current wording
Trustmark's financial results for the first three months of 2025 reflected continued growth in loans held for investment (LHFI), stable credit quality and an attractive deposit base. Trustmark's capital position remained solid, reflecting the consistent profitability of its diversified financial services businesses. Trustmark continues efforts to expand customer relationships and diligently manage expenses. With robust capital, liquidity and profitability, Trustmark is well-positioned to compete in changing economic conditions and create long-term value for its shareholders. Trustmark’s Board of Directors declared a quarterly cash dividend of $0.24 per share. The dividend is payable June 15, 2025, to shareholders of record on June 1, 2025.
Previous wording
Economic activity improved slightly during the first nine months of 2024; however, economic concerns remain as a result of the cumulative weight of uncertainty regarding the potential economic impact of geopolitical developments, such as the conflicts in Ukraine and the Middle East, inflation, other economic and industry volatility, the 2024 election cycle in the United States, higher energy prices and broader price pressures. Doubts surrounding the near-term direction of global markets and the potential impact on the United States economy are expected to persist for the near term. While Trustmark's customer base is wholly domestic, international economic conditions affect domestic economic conditions, and thus may have an impact upon Trustmark's financial condition or results of operations.
Current wording
Economic activity improved slightly during the first three months of 2025; however, economic concerns remain as a result of the cumulative weight of uncertainty regarding the potential economic impact of geopolitical developments, such as the conflicts in Ukraine and the Middle East, inflation, other economic and industry volatility, the current United States presidential administration's policies, higher energy prices and broader price pressures. Doubts surrounding the near-term direction of global markets and the potential impact on the United States economy are expected to persist for the near term. While Trustmark's customer base is wholly domestic, international economic conditions affect domestic economic conditions, and thus may have an impact upon Trustmark's financial condition or results of operations.
Previous wording
Market interest rates began to rise during 2022 after an extended period at historical lows. Starting in March 2022, the FRB began raising the target federal funds rate for the first time in three years and continued with multiple increases throughout 2022 and the first half of 2023. The FRB maintained the target federal funds rate at a range of 5.25% to 5.50% from July 2023 through September 2024. In September 2024, the FRB lowered the target federal funds rate to a range of 4.75% to 5.00% based on its confidence that inflation was moving substantially toward 2.00% and that the risks to achieving the FRB's employment and inflation goals were roughly balanced. In addition, the FRB increased the interest that it pays on reserves multiple times during 2022 and the first half of 2023 from 0.10% to 5.40% as of July 2023. The FRB maintained the rate it pays on reserves at 5.40% from July 2023 through September 2024. In September 2024, the FRB lowered the rate is pays on reserves to 4.90%. Prior period rate increases increased the competitive pressures on the deposit cost of funds. While rate cuts potentially reduce those competitive pressures, they increase pressure on Trustmark's net interest margin, a key component to its financial results. While the FRB has suggested that further rate cuts may occur in the near term, it is not possible to predict the direction, pace or magnitude of further changes in interest rates, or the impact any such rate changes will have on Trustmark's results of operations.
Current wording
Market interest rates remained elevated during most of 2024. In September 2024, the FRB began lowering the target federal funds rate making multiple decreases during the fourth quarter of 2024 to a range of 4.25% to 4.50% as of December 2024, based on its confidence that inflation was moving substantially toward 2.00% and that the risks to achieving the FRB's employment and inflation goals were roughly balanced. In addition, in September 2024, the FRB made the first of multiple reductions in the rate it pays on reserves, lowering the rate to 4.40% as of December 2024. At the January and March 2025 meetings of the FRB's Federal Open Market Committee, the FRB determined to leave the target federal funds rate unchanged at a range of 4.25% to 4.50% and to maintain the rate it pays on reserves at 4.40%. Prior period rate increases increased the competitive pressures on the deposit cost of funds. While rate cuts potentially reduced those competitive pressures, they increased pressure on Trustmark's net interest margin, a key component to its financial results. It is not possible to predict the direction, pace or magnitude of further changes, if any, in interest rates, or the impact any such rate changes will have on Trustmark's results of operations.
Previous wording
In the October 2024 “Summary of Commentary on Current Economic Conditions by Federal Reserve District,” the twelve Federal Reserve Districts’ reports suggested that during the reporting period (covering the period from August 26, 2024 through October 11, 2024) economic activity was little changed. Reports by the twelve Federal Reserve Districts (Districts) noted the following during the reporting period:
Current wording
In the February 2025 and April 2025 “Summary of Commentary on Current Economic Conditions by Federal Reserve District,” the twelve Federal Reserve Districts’ reports suggested that during the reporting periods (covering the periods from January 6, 2025 through February 24, 2025 and February 25, 2025 through April 14, 2025) economic activity rose slightly, but uncertainty around international trade policy was pervasive. Reports by the twelve Federal Reserve Districts (Districts) noted the following during the reporting periods:
Previous wording
Trustmark reported net income of $51.3 million, or basic and diluted earnings per share (EPS) of $0.84, in the third quarter of 2024, compared to $34.0 million, or basic and diluted EPS of $0.56, in the third quarter of 2023. Trustmark’s reported performance during the quarter ended September 30, 2024 produced a return on average tangible equity of 12.86%, a return on average assets of 1.10%, an average equity to average assets ratio of 10.39% and a dividend payout ratio of 27.38%, compared to a return on average tangible equity of 11.32%, a return on average assets of 0.72%, an average equity to average assets ratio of 8.46% and a dividend payout ratio of 41.07% during the quarter ended September 30, 2023.
Current wording
Trustmark reported net income of $53.6 million, or basic and diluted earnings per share (EPS) of $0.88, in the first quarter of 2025, compared to $41.5 million, or basic and diluted EPS of $0.68, in the first quarter of 2024. Trustmark’s reported performance during the quarter ended March 31, 2025 produced a return on average tangible equity of 13.13%, a return on average assets of 1.19%, an average equity to average assets ratio of 10.94% and a dividend payout ratio of 27.27%, compared to a return on average tangible equity of 12.98%, a return on average assets of 0.89%, an average equity to average assets ratio of 8.98% and a dividend payout ratio of 33.82% during the quarter ended March 31, 2024.
Previous wording
Trustmark completed the sale of FBBI during the second quarter of 2024. As such, financial results for the nine months ended September 30, 2024 and the three and nine months ended September 30, 2023, consist of both continuing and discontinued operations. The discontinued operations include the financial results of FBBI prior to the sale as well as the net gain on the sale in the second quarter. Trustmark reported net income from continuing operations of $51.3 million and a net loss from continuing operations of $11.1 million for the three and nine months ended September 30, 2024, respectively, compared to net income from continuing operations of $30.6 million and $119.4 million, respectively, for the same time periods in 2023. Trustmark's reported performance from continuing operations for the three and nine month ended September 30, 2024 produced a return on average tangible equity of 12.86% and -1.02%, respectively, and a return on average assets of 1.10% and -0.08%, respectively, compared to a return on average tangible equity of 9.72% and 13.03%, respectively, and a return on average assets of 0.65% and 0.86%, respectively, for the same time periods in 2023. The net loss from continuing operations for the nine months ended September 30, 2024 was principally due to the loss on the sale of available for sale securities during the second quarter of 2024.
Current wording
Trustmark completed the sale of FBBI during the second quarter of 2024. As such, financial results for the three months ended March 31, 2024 consist of both continuing and discontinued operations. The discontinued operations include the financial results of FBBI prior to the sale. Trustmark reported income from continuing operations of $38.2 million for the three months ended March 31, 2024. Trustmark's reported performance from continuing operations for the three months ended March 31, 2024 produced a return on average tangible equity of 11.45% and a return on average assets of 0.83%.
Previous wording
Total revenue, which is defined as net interest income plus noninterest income (loss), for the three months ended September 30, 2024 was $192.3 million, an increase of $16.7 million, or 9.5%, when compared to the same time period in 2023, principally due to an increase in net interest income primarily resulting from increases in interest and fees from loans held for sale (LHFS) and LHFI and interest on securities as well as a decline in other interest expense, partially offset by an increase in interest expense on deposits. Total revenue for the nine months ended September 30, 2024 was $364.2 million, a decrease of $163.8 million, or 31.0%, when compared to the same time period in 2023, reflecting a decline in noninterest income, primarily as a result of the loss on the sale of available for sale securities partially offset by an increase in other, net, and an increase in net interest income, primarily resulting from increases in interest and fees from LHFS and LHFI and interest on securities as well as a decline in other interest expense, partially offset by an increase in interest expense on deposits.
Current wording
Total revenue, which is defined as net interest income plus noninterest income (loss), for the three months ended March 31, 2025 was $194.6 million, an increase of $22.5 million, or 13.0%, when compared to the same time period in 2024, principally due to an increase in net interest income. Net interest income for the three months ended March 31, 2025 totaled $152.1 million, an increase of $19.2 million, or 14.5%, when compared to the same time period in 2024, principally attributable to an increase in interest on securities as well as declines in all categories of interest expense, partially offset by declines in interest and fees on loans held for sale (LHFS) and LHFI and other interest income. Interest income totaled $229.1 million for the three months ended March 31, 2025, a decrease of $693 thousand, or 0.3%, when compared to the same time period in 2024, reflecting decreases in interest and fees on LHFS and LHFI, primarily as a result of a decline in yields on the LHFS and LHFI portfolios, and other interest income, primarily due to a decline in interest earned on balances held at the Federal Reserve Bank of Atlanta (FRBA), largely offset by an increase in interest on securities, primarily as a result of restructuring the securities portfolio during the second quarter of 2024. Interest expense totaled $77.1 million for the three months ended March 31, 2025, a decrease of $19.9 million, or 20.5%, when compared to the same time period in 2024 reflecting declines in all categories of interest expense.
Previous wording
The PCL on off-balance sheet credit exposures totaled a negative $1.4 million and a negative $5.2 million for the three and nine months ended September 30, 2024, respectively, compared to $104 thousand and a negative $1.9 million, respectively, for the same time periods in 2023. The release in PCL on off-balance sheet credit exposures for the three months ended September 30, 2024, primarily reflected a decrease in required reserves as a result of a decrease in unfunded commitments and changes in the total reserve rate, partially offset by an increase in required reserves as a result of implementing the External Factor-Credit Quality Review qualitative reserve factor. The release in PCL on off-balance sheet credit exposures for the nine months ended September 30, 2024, primarily reflected a decrease in required reserves as a result of a decrease in unfunded commitments and changes in the total reserve rate, partially offset by an increase in required reserves as a result of implementing the performance trend and the External Factor-Credit Quality Review qualitative reserve factors. Please see the section captioned “Provision for Credit Losses” for additional information regarding the PCL on LHFI and off-balance sheet credit exposures.
Current wording
Trustmark’s total PCL on LHFI for the three months ended March 31, 2025 totaled $8.1 million, an increase of $417 thousand, or 5.4%, when compared to the same time period in 2024. The PCL, LHFI for the three months ended March 31, 2025 primarily reflected increases in required reserves as a result of updates to qualitative reserve factors, credit migration, changes in macroeconomic forecasts and loan growth. The PCL on off-balance sheet credit exposures totaled a negative $2.8 million for the three months ended March 31, 2025, compared to a negative $192 thousand for the same time period in 2024. The release in PCL, off-balance sheet credit exposures for the three months ended March 31, 2025, primarily reflected a decrease in required reserves as a result of a decrease in the unfunded commitments and changes in the total reserve rate primarily related to commercial construction. Please see the section captioned “Provision for Credit Losses” for additional information regarding the PCL on LHFI and off-balance sheet credit exposures.
Previous wording
At September 30, 2024, nonperforming assets totaled $77.7 million, a decrease of $29.1 million, or 27.3%, compared to December 31, 2023, reflecting declines in both nonaccrual LHFI and other real estate. Nonaccrual LHFI totaled $73.8 million at September 30, 2024, a decrease of $26.2 million, or 26.2%, relative to December 31, 2023, primarily as a result of the sale of 1-4 family mortgage loans during the second quarter of 2024 as well as the resolution of two large nonaccrual commercial credits in the Texas and Alabama market regions, partially offset by three large commercial credits placed on nonaccrual in the Alabama and Texas market regions. Other real estate, net totaled $3.9 million at September 30, 2024, a decrease of $2.9 million, or 42.9%, when compared to December 31, 2023, principally due to properties sold in the Mississippi and Alabama market regions and a reserve for other real estate write-downs recorded for a foreclosed property in the Texas market region which is under contract to be sold during the fourth quarter of 2024, partially offset by properties foreclosed in the Mississippi market region.
Current wording
At March 31, 2025, nonperforming assets totaled $95.0 million, an increase of $8.9 million, or 10.4%, compared to December 31, 2024, reflecting increases in both nonaccrual LHFI and other real estate. Nonaccrual LHFI totaled $86.6 million at March 31, 2025, an increase of $6.5 million, or 8.1%, relative to December 31, 2024, primarily as a result of 1-4 family mortgage loans placed on nonaccrual status partially offset by nonaccrual loans foreclosed during the first three months of 2025 in the Mississippi market region. Other real estate, net totaled $8.3 million at March 31, 2025, an increase of $2.4 million, or 41.1%, when compared to December 31, 2024, principally due to properties foreclosed partially offset by properties sold in the Mississippi market region.
Previous wording
LHFI totaled $13.100 billion at September 30, 2024, an increase of $149.6 million, or 1.2%, compared to December 31, 2023. The increase in LHFI during the first nine months of 2024 was primarily due to net growth in LHFI secured by real estate and other commercial loans and leases partially offset by declines in commercial and industrial LHFI and state and other political subdivision LHFI. For additional information regarding changes in LHFI and comparative balances by loan category, see the section captioned “LHFI.”
Current wording
LHFI totaled $13.241 billion at March 31, 2025, an increase of $151.5 million, or 1.2%, compared to December 31, 2024. The increase in LHFI during the first three months of 2025 was primarily due to net growth in LHFI secured by real estate and other commercial loans and leases partially offset by net declines in commercial and industrial LHFI. For additional information regarding changes in LHFI and comparative balances by loan category, see the section captioned “LHFI.”
Previous wording
Total deposits were $15.241 billion at September 30, 2024, a decrease of $328.8 million, or 2.1%, compared to December 31, 2023. During the first nine months of 2024, noninterest-bearing deposits decreased $54.8 million, or 1.7%, principally due to declines in consumer noninterest-bearing demand deposit accounts. Interest-bearing deposits decreased $274.0 million, or 2.2%, during the first nine months of 2024, primarily due to declines in public and consumer interest checking accounts, consumer savings accounts and brokered certificates of deposits (CDs), partially offset by growth in commercial interest checking accounts and commercial and consumer money market deposit accounts (MMDA) and CDs.
Current wording
Total deposits were $15.081 billion at March 31, 2025, a decrease of $27.5 million, or 0.2%, compared to December 31, 2024. During the first three months of 2025, noninterest-bearing deposits decreased $3.6 million, or 0.1%, principally due to a decline in public noninterest-bearing demand deposit accounts largely offset by increases in consumer and commercial noninterest-bearing demand deposit accounts. Interest-bearing deposits decreased $23.8 million, or 0.2%, during the first three months of 2025, primarily due to declines in consumer and commercial interest checking accounts and consumer certificates of deposits (CDs), partially offset by growth in public interest checking accounts, commercial money market deposit accounts (MMDA), consumer savings accounts and brokered CDs.
Previous wording
Federal funds purchased and securities sold under repurchase agreements totaled $365.6 million at September 30, 2024, a decrease of $40.1 million, or 9.9%, compared to December 31, 2023, principally due to a decrease in upstream federal funds purchased. Other borrowings totaled $443.5 million at September 30, 2024, a decrease of $39.8 million, or 8.2%, compared to December 31, 2023, principally due to a decline in outstanding short-term FHLB advances with the FHLB of Dallas.
Current wording
Federal funds purchased and securities sold under repurchase agreements totaled $360.1 million at March 31, 2025, an increase of $36.1 million, or 11.1%, compared to December 31, 2024, principally due to an increase in upstream federal funds purchased. Other borrowings totaled $404.8 million at March 31, 2025, an increase of $103.3 million, or 34.2%, compared to December 31, 2024, principally due to an increase in outstanding short-term FHLB advances with the FHLB of Dallas.
Previous wording
On July 30, 2024, the FDIC issued a proposed rule that would revise the FDIC’s regulations governing the classification and treatment of brokered deposits. The proposal would, among other changes, broaden the definition of deposit broker to include agents that place or facilitate the placement of third-party deposits at only one insured depository institution and agents that receive a fee or other remuneration in exchange for the placement of deposits. In addition, the proposal would narrow the exception to the definition of deposit broker for agents whose primary purpose is not the placement of funds with depository institutions. While Trustmark is evaluating the potential impact of the proposed rule, if the rule is finalized as proposed, Trustmark may be required to classify a greater amount of its deposits obtained with the involvement of third parties as brokered deposits. An increase in the amount of brokered deposits on Trustmark’s balance sheet could, among other consequences, increase Trustmark’s deposit insurance assessment costs.
Current wording
On July 30, 2024, the FDIC issued a proposed rule that would revise the FDIC’s regulations governing the classification and treatment of brokered deposits. On March 3, 2025, the FDIC withdrew the proposed rule.
Previous wording
Net interest income is the principal component of Trustmark’s income stream and represents the difference, or spread, between interest and fee income generated from earning assets and the interest expense paid on deposits and borrowed funds. Fluctuations in interest rates, as well as volume and mix changes in earning assets and interest-bearing liabilities, can materially impact net interest income. The net interest margin is computed by dividing fully taxable equivalent (FTE) net interest income by average interest-earning assets and measures how effectively Trustmark utilizes its interest-earning assets in relationship to the interest cost of funding them. The accompanying yield/rate analysis tables show the average balances for all assets and liabilities of Trustmark and the interest income or expense associated with earning assets and interest-bearing liabilities. The yields and rates have been computed based upon interest income and expense adjusted to a FTE basis using the federal statutory corporate tax rate in effect for each of the periods shown. Loans on nonaccrual have been included in the average loan balances, and interest collected prior to these loans having been placed on nonaccrual has been included in interest income. Loan fees included in interest associated with the average LHFS and LHFI balances were immaterial.
Current wording
Net interest income is the principal component of Trustmark’s income stream and represents the difference, or spread, between interest and fee income generated from earning assets and the interest expense paid on deposits and borrowed funds. Fluctuations in interest rates, as well as volume and mix changes in earning assets and interest-bearing liabilities, can materially impact net interest income. The net interest margin is computed by dividing fully taxable equivalent (FTE) net interest income by average interest-earning assets and measures how effectively Trustmark utilizes its interest-earning assets in relationship to the interest cost of funding them. The accompanying yield/rate analysis table shows the average balances for all assets and liabilities of Trustmark and the interest income or expense associated with earning assets and interest-bearing liabilities. The yields and rates have been computed based upon interest income and expense adjusted to a FTE basis using the federal statutory corporate tax rate in effect for each of the periods shown. Loans on nonaccrual have been included in the average loan balances, and interest collected prior to these loans having been placed on nonaccrual has been included in interest income. Loan fees included in interest associated with the average LHFS and LHFI balances were immaterial.
Previous wording
Net interest income-FTE for the three months ended September 30, 2024, increased $16.1 million, or 11.3%, when compared to the same time period in 2023 principally due to increases in interest and fees on LHFS and LHFI-FTE and interest on securities-taxable as well as a decline in other interest expense, partially offset by an increase in interest on deposits. Net interest income-FTE for the nine months ended September 30, 2024 increased $12.3 million, or 2.9%, when compared with the same time period in 2023 principally due to increases in interest and fees on LHFS and LHFI-FTE and interest on securities-taxable as well as a decline in other interest expense, partially offset by an increase in interest on deposits and a decline in other interest income. The net interest margin-FTE for the three and nine months ended September 30, 2024 increased 40 basis points to 3.69% and 9 basis points to 3.43%, respectively, when compared to the same time periods in 2023, principally due to increases in the yields on the LHFS and LHFI portfolios and the securities portfolio, primarily due to the restructuring of the available for sale securities portfolio during the second quarter of 2024, partially offset by an increase in the cost of interest-bearing deposits.
Current wording
Net interest income-FTE for the three months ended March 31, 2025 increased $18.5 million, or 13.6%, when compared with the same time period in 2024 reflecting declines in all categories of interest expense as well as an increase in interest on securities, partially offset by declines in interest and fees on LHFS and LHFI-FTE and other interest income. The net interest margin-FTE for the three months ended March 31, 2025 increased 54 basis points to 3.75% when compared to the same time period in 2024, principally due to an increase in the yield on the securities portfolio, primarily due to the restructuring of the available for sale securities portfolio during the second quarter of 2024, as well as decreases in the cost of interest-bearing liabilities.
Previous wording
Average interest-earning assets for the three months ended September 30, 2024 was $17.016 billion compared to $17.110 billion for the same time period in 2023, a decline of $94.9 million, or 0.6%, principally due to a decline in average total securities and average other earning assets partially offset by an increase in average loans (LHFS and LHFI). Average interest-earning assets for the nine months ended September 30, 2024 was $17.097 billion compared to $17.076 billion for the same time period in 2023, an increase of $21.5 million, or 0.1%, principally due to an increase in average loans (LHFS and LHFI) largely offset by a decline in average total securities and average other earning assets. Average loans (LHFS and LHFI) increased $452.7 million, or 3.5%, and $555.3 million, or 4.4%, when the three and nine months ended September 30, 2024, respectively, are compared to the same time periods in 2023, principally due to an increase in the average balance of the LHFI portfolio of $442.0 million, or 3.5%, and $538.1 million, or 4.3%, respectively. The increase in the LHFI portfolio when the balances at September 30, 2024 are compared to September 30, 2023 was principally due to net growth in LHFI secured by real estate and other commercial loans and leases partially offset by declines in commercial and industrial loans and state and other political subdivision loans. Average total securities declined $472.6 million, or 13.5%, and $374.9 million, or 10.4%, respectively, when the three and nine months ended September 30, 2024 are compared to the same time periods in 2023, principally due to available for sale securities sold net of available for sale securities purchased as part of the restructuring of the available for sale securities portfolio during the second quarter of 2024 as well as calls, maturities and pay-downs of the loans underlying GSE guaranteed securities. Average other earning assets decreased $75.4 million, or 11.0%, and $157.2 million, or 21.0%, respectively, when the three and nine months ended September 30, 2024 are compared to the same time periods in 2023, primarily due to decreases in reserves held at the FRBA and investments in FHLB stock.
Current wording
Average interest-earning assets for the three months ended March 31, 2025 totaled $16.737 billion compared to $17.088 billion for the same time period in 2024, a decrease of $350.3 million, or 2.1%, principally due to decreases in average total securities and average other earning assets partially offset by an increase in average loans (LHFS and LHFI). Average total securities declined $295.0 million, or 8.8%, when the three months ended March 31, 2025 is compared to the same time period in 2024, principally due to available for sale securities sold net of available for sale securities purchased as part of the restructuring of the available for sale securities portfolio during the second quarter of 2024 as well as calls, maturities and pay-downs of the loans underlying GSE guaranteed securities. Average other earning assets decreased $205.8 million, or 36.0%, when the three months ended March 31, 2025 is compared to the same time period in 2024, primarily due to a decrease in reserves held at the FRBA. Average loans (LHFS and LHFI) increased $150.5 million, or 1.1%, when the three months ended March 31, 2025 is compared to the same time period in 2024, principally due to an increase in the average balance of the LHFI portfolio of $142.6 million, or 1.1%. The increase in the LHFI portfolio when the balances at March 31, 2025 are compared to March 31, 2024 was principally due to net growth in LHFI secured by real estate and other commercial loans and leases partially offset by declines in commercial and industrial loans and state and other political subdivision loans.
Previous wording
Interest income-FTE for the three and nine months ended September 30, 2024 totaled $254.9 million and $730.6 million, respectively, an increase of $23.1 million, or 10.0%, and $74.4 million, or 11.3%, respectively, while the yield on total earning assets increased to 5.96% and 5.71%, respectively, compared to 5.38% and 5.14%, respectively, for the same time periods in 2023. The increase in interest income-FTE for the three months ended September 30, 2024 was primarily due to increases in interest and fees on LHFS and LHFI-FTE and interest on securities-taxable. The increase in interest income-FTE for the nine months ended September 30, 2024 was primarily due to increases in interest and fees on LHFS and LHFI-FTE and interest on securities-taxable partially offset by a decline in other interest income. During the three and nine months ended September 30, 2024, interest and fees on LHFS and LHFI-FTE increased $13.9 million, or 6.7%, and $67.9 million, or 11.7%, respectively, while the yield on LHFS and LHFI increased 21 basis points to 6.55% and 43 basis points to 6.50%, respectively, when compared to the same time periods in 2023, primarily due to the higher interest rate environment as well as the increase in the average balance of LHFI. Interest on securities-taxable increased $9.5 million, or 57.4%, and $9.6 million, or 19.1%, respectively, when the three and nine months ended September 30, 2024 are compared to the same time periods in 2023, while the yield on securities-taxable increased to 3.44% and 2.48%, respectively, compared to 1.89% and 1.87%, respectively, principally due to the restructuring of the available for sale securities portfolio during the second quarter of 2024. During the nine months ended September 30, 2024, other interest income declined $2.7 million, or 9.9%, while the yield on other earning assets increased 68 basis points to 5.55% when compared to the same time period in 2023, principally due to a decline in interest earned on reserves held at the FRBA.
Current wording
Interest income-FTE for the three months ended March 31, 2025 totaled $231.8 million, a slight decrease of $1.4 million, or 0.6%, while the yield on total earning assets increased to 5.62% compared to 5.49% for the same time period in 2024. The slight decrease in interest income-FTE for the three months ended March 31 2025 was primarily due to decreases in interest and fees on LHFS and LHFI-FTE and other interest income largely offset by an increase in interest on securities-taxable. During the three months ended March 31, 2025, interest and fees on LHFS and LHFI-FTE decreased $7.5 million, or 3.6%, while the yield on LHFS and LHFI decreased 25 basis points to 6.15% when compared to the same time period in 2024, primarily due to a decline in interest rates. During the three months ended March 31, 2025, other interest income declined $4.3 million, or 52.6%, while the yield on other earning assets decreased 144 basis points to 4.27% when compared to the same time period in 2024, principally due to a decline in interest earned on reserves held at the FRBA reflecting both a decline in reserves held at the FRBA and a decline in the rate paid by the FRB on reserve balances. Interest on securities-taxable increased $10.4 million, or 66.7%, when the three months ended March 31, 2025 is compared to the same time period in 2024, while the yield on securities-taxable increased to 3.46% compared to 1.88%, principally due to the restructuring of the available for sale securities portfolio during the second quarter of 2024.
Previous wording
Average interest-bearing liabilities for the three months ended September 30, 2024 totaled $13.088 billion compared to $13.105 billion for the same time period in 2023, a decrease of $17.2 million, or 0.1%, principally due to declines in average other borrowings and average federal funds purchased and securities sold under repurchase agreements largely offset by growth in average interest-bearing deposits. Average interest-bearing liabilities for the nine months ended September 30, 2024 totaled $13.280 billion compared to $12.914 billion for the same time period in 2023, an increase of $365.6 million, or 2.8%, principally due to growth in interest-bearing deposits partially offset by a decline in average other borrowings. Average interest-bearing deposits for the three and nine months ended September 30, 2024 increased $594.4 million, or 5.1%, and $1.038 billion, or 9.3%, respectively, when compared to the same time periods in 2023, reflecting growth in average time deposits and average interest-bearing demand deposits, partially offset by declines in average savings deposits. Average federal funds purchased and securities sold under repurchase agreements for the three months ended September 30, 2024 decreased $39.1 million, or 9.4%, when compared to the same time period in 2023, principally due to a decline in upstream federal funds purchased. Average other borrowings for the three and nine months ended September 30, 2024 decreased $572.5 million, or 52.2%, and $671.4 million, or 51.6%, respectively, when compared to the same time periods in 2023, principally due to the decrease in outstanding short-term FHLB advances with the FHLB of Dallas as a result of changes in funding needs.
Current wording
Average interest-bearing liabilities for the three months ended March 31, 2025 totaled $12.877 billion compared to $13.376 billion for the same time period in 2024, a decrease of $498.9 million, or 3.7%, reflecting declines in all categories of average interest-bearing liabilities. Average interest-bearing deposits for the three months ended March 31, 2025 decreased $356.8 million, or 2.9%, when compared to the same time period in 2024, reflecting declines in all categories of average interest-bearing deposits. Average other borrowings for the three months ended March 31, 2025 decreased $119.2 million, or 18.4%, when compared to the same time period in 2024, principally due to the decrease in average short-term FHLB advances outstanding with the FHLB of Dallas as a result of changes in funding needs. Average federal funds purchased and securities sold under repurchase agreements for the three months ended March 31, 2025 decreased $22.9 million, or 5.4%, when compared to the same time period in 2024, reflecting declines in both upstream federal funds purchased and securities sold under repurchase agreements.
Previous wording
The PCL, LHFI is the amount necessary to maintain the ACL for LHFI at the amount of expected credit losses inherent within the LHFI portfolio. The amount of PCL and the related ACL for LHFI are based on Trustmark’s ACL methodology. The PCL, LHFI, excluding the PCL, LHFI sale of 1-4 family mortgage loans, totaled $7.9 million and $30.3 million for the three and nine months ended September 30, 2024, respectively, compared to $8.3 million and $19.8 million, respectively, for the same time periods in 2023. The PCL on LHFI, excluding the PCL, LHFI sale of 1-4 family mortgage loans, for the three months ended September 30, 2024 primarily reflected increases in required reserves related to individually analyzed LHFI and the implementation of the External Factor-Credit Quality Review qualitative factor, partially offset by declines in required reserves resulting from the update of the macroeconomic forecasts and net changes in other qualitative reserve factors. The PCL on LHFI, excluding the PCL, LHFI 1-4 family mortgage loans, for the nine months ended September 30, 2024 primarily reflected an increase in required reserves as a result of net adjustments to the qualitative factors due to credit migration, implementation of the External Factor-Credit Quality Review qualitative factor, and specific reserves for individually analyzed LHFI, partially offset by net changes in the macroeconomic forecast associated with specific loss driver models as a result of loss driver updates and net changes in other qualitative reserve factors.
Current wording
The PCL, LHFI is the amount necessary to maintain the ACL for LHFI at the amount of expected credit losses inherent within the LHFI portfolio. The amount of PCL and the related ACL for LHFI are based on Trustmark’s ACL methodology. The PCL, LHFI, totaled $8.1 million for the three months ended March 31, 2025, compared to $7.7 million for the same time period in 2024. The PCL, LHFI for the three months ended March 31, 2025 primarily reflected increases in required reserves as a result of updates to qualitative reserve factors, credit migration, changes in macroeconomic forecasts and loan growth.
Previous wording
FASB ASC Topic 326 requires Trustmark to estimate expected credit losses for off-balance sheet credit exposures which are not unconditionally cancellable by Trustmark. Trustmark maintains a separate ACL for off-balance sheet credit exposures, including unfunded commitments and letters of credit. Adjustments to the ACL on off-balance sheet credit exposures are recorded to the PCL, off-balance sheet credit exposures. The PCL, off-balance sheet credit exposures totaled a negative $1.4 million and a negative $5.2 million for the three and nine months ended September 30, 2024, respectively, compared to $104 thousand and a negative $1.9 million, respectively, for the same time periods in 2023. The release in PCL on off-balance sheet credit exposures for the three months ended September 30, 2024, primarily reflected a decrease in required reserves as a result of a decrease in unfunded commitments and changes in the total reserve rate, partially offset by an increase in required reserves as a result of implementing the External Factor-Credit Quality Review qualitative reserve factor. The release in PCL on off-balance sheet credit exposures for the nine months ended September 30, 2024, primarily reflected a decrease in required reserves as a result of a decrease in unfunded commitments and changes in the total reserve rate, partially offset by an increase in required reserves as a result of implementing the performance trend and the External Factor-Credit Quality Review qualitative reserve factors.
Current wording
FASB ASC Topic 326 requires Trustmark to estimate expected credit losses for off-balance sheet credit exposures which are not unconditionally cancellable by Trustmark. Trustmark maintains a separate ACL for off-balance sheet credit exposures, including unfunded commitments and letters of credit. Adjustments to the ACL on off-balance sheet credit exposures are recorded to the PCL, off-balance sheet credit exposures. The PCL, off-balance sheet credit exposures totaled a negative $2.8 million for the three months ended March 31, 2025, compared to a negative $192 thousand for the same time period in 2024. The release in PCL, off-balance sheet credit exposures for the three months ended March 31, 2025, primarily reflected a decrease in required reserves as a result of a decrease in the unfunded commitments and changes in the total reserve rate primarily related to commercial construction.
Previous wording
The decrease in mortgage banking, net for the three months ended September 30, 2024 when compared to the same time period in 2023 was principally due to an increase in the net negative hedge ineffectiveness, partially offset by an increase in the gain on sales of loans, net. The decrease in mortgage banking, net for the nine months ended September 30, 2024 when compared to the same time period in 2023 was principally due to increases in the net negative hedge ineffectiveness and the run-off of the MSR, partially offset by an increase in the gain on sales of loans, net. Mortgage loan production for the three and nine months ended September 30, 2024 was $392.1 million and $1.046 billion, respectively, an increase of $2.2 million, or 0.6%, and a decrease of $136.7 million, or 11.6%, respectively, when compared to the same time periods in 2023. Loans serviced for others totaled $8.691 billion at September 30, 2024, compared with $8.403 billion at September 30, 2023, an increase of $287.9 million, or 3.4%.
Current wording
The decrease in mortgage banking, net for the three months ended March 31, 2025 when compared to the same time period in 2024 was principally due to a decrease in the gain on sales of loans, net and an increase in the amortization of the MSR, largely offset by a decrease in the net negative hedge ineffectiveness. Mortgage loan production for the three months ended March 31, 2025 was $318.8 million, an increase of $44.8 million, or 16.4%, when compared to the same time period in 2024. Loans serviced for others totaled $8.811 billion at March 31, 2025, compared with $8.553 billion at March 31, 2024, an increase of $258.2 million, or 3.0%.
Previous wording
Representing a significant component of mortgage banking income is the gain on sales of loans, net. The increase in the gain on sales of loans, net when the three months ended September 30, 2024 is compared to the same time period in 2023, was primarily the result of higher profit margins in secondary marketing activities and an increase in the mortgage valuation adjustment, partially offset by a decline in the volume of loans sold. The increase in the gain on sales of loans, net when the nine months ended September 30, 2024 is compared to the same time period in 2023, was primarily the result of higher profit margins in secondary marketing activities partially offset by declines in the mortgage valuation adjustment and the volume of loans sold. Loan sales totaled $288.5 million and $843.6 million for the three and nine months ended September 30, 2024, respectively, a decrease of $55.2 million, or 16.1%, and $49.4 million, or 5.5%, respectively, when compared with the same time periods in 2023.
Current wording
Representing a significant component of mortgage banking income is the gain on sales of loans, net. The decrease in the gain on sales of loans, net when the three months ended March 31, 2025 is compared to the same time period in 2024, was primarily the result of lower profit margins in secondary marketing activities partially offset by an increase in the mortgage valuation adjustment. Loan sales totaled $255.8 million for the three months ended March 31, 2025, a decrease of $2.5 million, or 1.0%, when compared with the same time period in 2024.
Previous wording
The decrease in salaries and employee benefits when the nine months ended September 30, 2024 is compared to the same time period in 2023 was principally due to declines in commissions related to mortgage production, other salaries expense and medical insurance expense, partially offset by an increase in salaries expense primarily due to general merit increases.
Current wording
The increase in salaries and employee benefits when the three months ended March 31, 2025 is compared to the same time period in 2024 was primarily due to increases in medical insurance expense, salaries expense principally due to general merit increases, commissions related to mortgage originations and annual incentive compensation.
Previous wording
The decreases in services and fees when the three and nine months ended September 30, 2024 are compared to the same time periods in 2023 were principally due to declines in outside services and fees, primarily related to other professional fees and legal expense, communication expense, primarily related to telephone expense, and advertising expense, partially offset by an increase in data processing expenses related to software.
Current wording
The increases in services and fees when the three months ended March 31, 2025 is compared to the same time period in 2024 were principally due to increases in data processing expenses related to software, advertising expense, legal expense, and business process operations outsourcing expense.
Previous wording
For a description of the methodologies used to measure financial performance and financial information by reportable segment, please see Note 19 – Segment Information included in Part I. Item 1. – Financial Statements of this report. The Insurance Segment is included in discontinued operations for all periods presented in the accompanying consolidated balance sheets and the consolidated statements of income (loss). For additional information about discontinued operations, please see Note 2 - Discontinued Operations included in Part I. Item 1. – Financial Statements of this report. The following discusses changes in the results of operations of each reportable segment for the nine months ended September 30, 2024 and 2023.
Current wording
For a description of the methodologies used to measure financial performance and financial information by reportable segment, please see Note 19 – Segment Information included in Part I. Item 1. – Financial Statements of this report. The Insurance Segment is included in discontinued operations for the three months ended March 31, 2024. For additional information about discontinued operations, please see Note 2 - Discontinued Operations included in Part I. Item 1. – Financial Statements of this report. The following discusses changes in the results of operations of each reportable segment for the three months ended March 31, 2025 and 2024.
Previous wording
Net interest income for the General Banking Segment increased $12.6 million, or 3.1%, when the nine months ended September 30, 2024 is compared with the same time period in 2023. The increase in net interest income was principally due to increases in interest and fees on LHFS and LHFI and interest on securities as well as a decline in other interest expense, primarily due to a decline in FHLB advances with the FHLB of Dallas, partially offset by an increase in interest on deposits and a decline in other interest income, primarily due to a decline in reserves held at the FRBA. The PCL (LHFI and off-balance sheet credit exposures) for the General Banking Segment for the nine months ended September 30, 2024 totaled $33.6 million compared to a PCL of $20.0 million for the same time period in 2023, an increase of $13.6 million, or 68.0%. Excluding the $8.6 million PCL, LHFI sale of 1-4 family mortgage loans, the PCL for the General Banking Segment totaled $25.0 million for the first nine months of 2024, an increase of $5.0 million, or 24.9%. For more information on these net interest income and PCL items, please see the sections captioned “Financial Highlights” and “Results of Operations.”
Current wording
Net interest income for the General Banking Segment increased $18.8 million, or 14.3%, when the three months ended March 31, 2025 is compared with the same time period in 2024. The increase in net interest income was principally due to an increase in interest on securities as well as declines in all categories of interest expense, partially offset by declines in interest and fees from LHFS and LHFI and other interest income. The net PCL (LHFI and off-balance sheet credit exposures) for the General Banking Segment for the three months ended March 31, 2025 totaled $5.3 million compared to a net PCL of $7.3 million for the same time period in 2024, a decrease of $2.1 million, or 27.9%. For more information on these net interest income and PCL items, please see the sections captioned “Financial Highlights” and “Results of Operations.”
Previous wording
Noninterest income (loss) for the General Banking Segment decreased $177.9 million when the first nine months of 2024 is compared to the same time period in 2023, primarily due to the net loss on the sale of available for sale securities, the noncredit-related loss on the sale of 1-4 family mortgage loans and a decrease in mortgage banking, net, partially offset by the gain on the conversion of Visa Class B-1 shares to Visa Class C shares and increases in cash management service fees and nonsufficient fund (NSF) and overdraft fees. Noninterest income (loss) for the General Banking Segment includes service charges on deposit accounts; wealth management; bank card and other fees; mortgage banking, net; other, net and security gains (losses), net. For more information on these noninterest income items, please see the analysis included in the section captioned “Noninterest Income (Loss).”
Current wording
Noninterest income (loss) for the General Banking Segment increased $2.6 million, or 8.6%, when the first three months of 2025 is compared to the same time period in 2024, primarily due to an increase in other, net, principally resulting from a $2.4 million gain on the sale of a bank property during the first quarter of 2025 as well as a gain in income from other partnership investments. Noninterest income (loss) for the General Banking Segment includes service charges on deposit accounts; wealth management; bank card and other fees; mortgage banking, net; other, net and securities gains (losses), net. For more information on these noninterest income items, please see the analysis included in the section captioned “Noninterest Income (Loss).”
Previous wording
Noninterest expense for the General Banking Segment decreased $8.4 million, or 2.4%, when the first nine months of 2024 is compared with the same time period in 2023, principally due to litigation settlement expense recorded in the third quarter of 2023 as well as declines in outside services and fees, salaries and employee benefits, advertising expenses and communications expense, partially offset by increases in FDIC assessment expense, other real estate expense and data processing charges related to software. For more information on these noninterest expense items, please see the analysis included in the section captioned “Noninterest Expense.”
Current wording
Noninterest expense for the General Banking Segment increased $4.2 million, or 3.7%, when the first three months of 2025 is compared with the same time period in 2024, principally due to increases in salaries and employee benefits and data processing charges related to software. For more information on these noninterest expense items, please see the analysis included in the section captioned “Noninterest Expense.”
Previous wording
Net income for the Wealth Management Segment for the first nine months of 2024 decreased $628 thousand, or 9.7%, when compared to the same time period in 2023, primarily due to an increase in the PCL partially offset by an increase in noninterest income. The PCL for the nine months ended September 30, 2024 totaled $162 thousand compared to a negative PCL of $2.1 million for the same period in 2023, an increase of $2.3 million. Noninterest income for the Wealth Management Segment, which primarily includes income related to investment management, trust and brokerage services, increased $1.7 million, or 6.5%, when the first nine months of 2024 is compared to the same time period in 2023, primarily due to an increase in income from brokerage and investment services. Noninterest expense for the Wealth Management Segment increased $149 thousand, or 0.6%, when the first nine months of 2024 is compared to the same time period in 2023, principally due to an increase in salaries and employee benefits expense, primarily related to broker commissions and trust incentives, partially offset by a decrease in business process outsourcing expense.
Current wording
Net income for the Wealth Management Segment for the first three months of 2025 increased $761 thousand, or 47.8%, when compared to the same time period in 2024, primarily due to increases in net interest income and noninterest income. Net interest income for the Wealth Management Segment for the three months ended March 31, 2025 increased $418 thousand, or 31.8%, when compared to the same time period in 2024, principally due to an increase in interest and fees on loans. The net PCL for the three months ended March 31, 2025 totaled a negative $3 thousand compared to a net PCL of $168 thousand for the same period in 2024, a decrease of $171 thousand. Noninterest income for the Wealth Management Segment, which primarily includes income related to investment management, trust and brokerage services, increased $613 thousand, or 6.8%, when the first three months of 2025 is compared to the same time period in 2024, primarily due to an increase in income from trust management services. Noninterest expense for the Wealth Management Segment increased $185 thousand, or 2.3%, when the first three months of 2025 is compared to the same time period in 2024, principally due to an increase in salaries and employee benefits expense, primarily related to trust and portfolio manager annual incentives and medical insurance expense.
Previous wording
At September 30, 2024 and 2023, Trustmark held assets under management and administration of $9.425 billion and $8.235 billion, respectively, and brokerage assets of $2.742 billion and $2.431 billion, respectively.
Current wording
At March 31, 2025 and 2024, Trustmark held assets under management and administration of $9.547 billion and $8.799 billion, respectively, and brokerage assets of $2.603 billion and $2.712 billion, respectively.
Previous wording
For the three and nine months ended September 30, 2024, Trustmark’s combined effective tax rate from continuing operations was 17.8% and 64.0%, respectively, compared to 17.1% and 15.1%, respectively, for the same time periods in 2023. The increase in the effective tax rate from continuing operations for the nine months ended September 30, 2024 was principally due to the significant non-routine transactions that occurred during the second quarter of 2024. Excluding the significant non-routine transactions, Trustmark’s combined effective tax rate from continuing operations for the nine months ended September 30, 2024 was 17.4%. Trustmark’s effective tax rate continues to be less than the statutory rate primarily due to various tax-exempt income items and its utilization of income tax credit programs. 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). 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.
Current wording
For the three months ended March 31, 2025, Trustmark’s combined effective tax rate from continuing operations was 17.9% compared to 15.2% for the same time period in 2024. Trustmark’s effective tax rate continues to be less than the statutory rate primarily due to various tax-exempt income items and its utilization of income tax credit programs. 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). 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.
Previous wording
Earning assets serve as the primary revenue streams for Trustmark and are comprised of securities, loans, federal funds sold, securities sold under reverse repurchase agreements and other earning assets. Average earning assets totaled $17.097 billion, or 91.6% of total average assets, for the nine months ended September 30, 2024, compared to $17.076 billion, or 91.5% of total average assets, for the nine months ended September 30, 2023, an increase of $21.5 million, or 0.1%.
Current wording
Earning assets serve as the primary revenue streams for Trustmark and are comprised of securities, loans and other earning assets. Average earning assets totaled $16.737 billion, or 92.0% of total average assets, for the three months ended March 31, 2025, compared to $17.088 billion, or 91.5% of total average assets, for the three months ended March 31, 2024, a decrease of $350.3 million, or 2.1%.
Previous wording
The securities portfolio is utilized by Management to manage interest rate risk, generate interest income, provide liquidity and use as collateral for public deposits and wholesale funding. Risk and return can be adjusted by altering duration, composition and/or balance of the portfolio. The weighted-average life of the portfolio was 4.7 years at September 30, 2024 compared to 4.5 years at December 31, 2023. The increase in the weighted-average life of the portfolio was principally due to the restructuring of the available for sale securities portfolio during the second quarter of 2024.
Current wording
The securities portfolio is utilized by Management to manage interest rate risk, generate interest income, provide liquidity and use as collateral for public deposits and wholesale funding. Risk and return can be adjusted by altering duration, composition and/or balance of the portfolio. The weighted-average life of the portfolio was 4.7 years at March 31, 2025 compared to 4.8 years at December 31, 2024.
Previous wording
When compared to December 31, 2023, total investment securities decreased by $105.0 million, or 3.3%, during the first nine months of 2024. This decrease resulted primarily from available for sale securities sold net of available for sale securities purchased as part of the restructuring of the available for sale securities portfolio during the second quarter of 2024 as well as calls, maturities and pay-downs of the loans underlying GSE guaranteed securities, partially offset by improvements in the fair market value of the available for sale securities and available for sale securities purchased during the third quarter of 2024. Trustmark sold $1.561 billion of available for sale securities generating a loss of $182.8 million during the first nine months of 2024, compared to no securities sold during the first nine months of 2023.
Current wording
When compared to December 31, 2024, total investment securities increased by $24.6 million, or 0.8%, during the first three months of 2025. This increase resulted primarily from purchases of available for sale securities and an increase in the fair market value of the available for sale securities, partially offset by calls, maturities and pay-downs of the loans underlying GSE guaranteed securities. Trustmark sold no securities during the first three months of 2025 and 2024.
Previous wording
At September 30, 2024, the net unamortized, unrealized loss on all transferred securities included in accumulated other comprehensive income (loss) (AOCI) in the accompanying consolidated balance sheets totaled $49.3 million compared to $57.6 million at December 31, 2023.
Current wording
At March 31, 2025, the net unamortized, unrealized loss on all transferred securities included in accumulated other comprehensive income (loss) (AOCI) in the accompanying consolidated balance sheets totaled $44.1 million compared to $46.6 million at December 31, 2024.
Previous wording
Available for sale securities are carried at their estimated fair value with unrealized gains or losses recognized, net of taxes, in AOCI, a separate component of shareholders’ equity. At September 30, 2024, available for sale securities totaled $1.726 billion, which represented 56.0% of the securities portfolio, compared to $1.763 billion, or 55.3% of total securities, at December 31, 2023. At September 30, 2024, unrealized gains, net on available for sale securities totaled $34.2 million compared to unrealized losses, net of $196.1 million at December 31, 2023. At September 30, 2024, available for sale securities consisted of U.S. Treasury securities, direct obligations of government agencies and GSE guaranteed mortgage-related securities.
Current wording
Available for sale securities are carried at their estimated fair value with unrealized gains or losses recognized, net of taxes, in AOCI, a separate component of shareholders’ equity. At March 31, 2025, available for sale securities totaled $1.737 billion, which represented 56.9% of the securities portfolio, compared to $1.693 billion, or 55.9% of total securities, at December 31, 2024. At March 31, 2025, unrealized gains, net on available for sale securities totaled $5.6 million compared to unrealized losses, net of $27.0 million at December 31, 2024. At March 31, 2025, available for sale securities consisted of U.S. Treasury securities, direct obligations of government agencies and GSE guaranteed mortgage-related securities.
Previous wording
Held to maturity securities are carried at amortized cost and represent those securities that Trustmark both intends and has the ability to hold to maturity. At September 30, 2024, held to maturity securities totaled $1.358 billion, which represented 44.0% of the total securities portfolio, compared to $1.426 billion, or 44.7% of total securities, at December 31, 2023.
Current wording
Held to maturity securities are carried at amortized cost and represent those securities that Trustmark both intends and has the ability to hold to maturity. At March 31, 2025, held to maturity securities totaled $1.315 billion, which represented 43.1% of the total securities portfolio, compared to $1.335 billion, or 44.1% of total securities, at December 31, 2024.
Previous wording
At September 30, 2024, LHFS totaled $216.5 million, consisting of $127.0 million of residential real estate mortgage loans in the process of being sold to third parties and $89.4 million of GNMA optional repurchase loans. At December 31, 2023, LHFS totaled $184.8 million, consisting of $106.0 million of residential real estate mortgage loans in the process of being sold to third parties and $78.8 million of GNMA optional repurchase loans. Please refer to the nonperforming assets table that follows for information on GNMA loans eligible for repurchase which are past due 90 days or more.
Current wording
At March 31, 2025, LHFS totaled $188.7 million, consisting of $92.7 million of residential real estate mortgage loans in the process of being sold to third parties and $96.0 million of GNMA optional repurchase loans. At December 31, 2024, LHFS totaled $200.3 million, consisting of $102.7 million of residential real estate mortgage loans in the process of being sold to third parties and $97.6 million of GNMA optional repurchase loans. Please refer to the nonperforming assets table that follows for information on GNMA loans eligible for repurchase which are past due 90 days or more.
Showing the first 40 of 80 pairs. Open the source sections for the rest.
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Previous report — wording carried elsewhere
Trustmark reported net income of $166.7 million, or basic and diluted EPS of $2.72, for the nine months ended September 30, 2024, compared to $129.4 million, or basic and diluted EPS of $2.12 and $2.11, respectively, for the same time period in 2023. Trustmark's reported performance during the first nine months of 2024 produced a return on average tangible equity of 15.79%, a return on average assets of 1.19%, an average equity to average assets ratio of 9.52% and a dividend payout ratio of 25.37%, compared to return on average tangible equity of 14.77%, a return on average assets of 0.93%, an average equity to average assets ratio of 8.37% and a dividend payout ratio of 32.55% for the first nine months of 2023.