Trustmark Corp (TRMK) SEC Filing 10-K Annual report for the fiscal year ending Thursday, December 31, 2020

Exhibit 99.1

Trustmark Corporation Announces Fourth Quarter and Fiscal Year 2020 Financial Results

Record earnings in 2020 reflect value of diversified financial services businesses

Solid balance sheet, credit quality and capital base provide strength and stability

JACKSON, Miss. – January 26, 2021 – Trustmark Corporation (NASDAQ:TRMK) reported net income of $51.2 million in the fourth quarter of 2020, representing diluted earnings per share of $0.81.  Net income in the fourth quarter produced a return on average tangible equity of 15.47% and a return on average assets of 1.28%.  For the full year, Trustmark’s net income totaled a record level of $160.0 million, representing diluted earnings per share of $2.51.  Diluted earnings per share in 2020 increased 8.2% when compared to the prior year.  Trustmark’s net income in 2020 produced a return on average tangible equity of 12.58% and a return on average assets of 1.05%.

Trustmark’s Board of Directors declared a quarterly cash dividend of $0.23 per share payable March 15, 2021, to shareholders of record on March 1, 2021.

Gerard R. Host, Executive Chairman, stated, “This past year has been extremely challenging for everyone.  The effects of COVID-19 have significantly impacted the ways in which we live, work and interact with one another.  We extend our deepest sympathies to all who lost loved ones and all who have been impacted by this pandemic.  We also extend our sincere appreciation and gratitude to healthcare professionals for their tireless and self-sacrificing work during this pandemic.  Also, we want to thank our associates for their countless efforts to serve our customers and support our communities and businesses.  Trustmark remains committed to providing solutions to meet customer’s unique needs during these unprecedented times.”

2020 Highlights

Duane A. Dewey, President and CEO, commented, “Our financial results demonstrate the value of Trustmark’s diversified financial services businesses.  Despite a challenging environment, our banking, insurance and wealth management businesses all performed well while our mortgage banking business achieved record results.  We experienced significant loan and deposit growth, and credit quality remained extremely strong as did capital ratios.  Trustmark continues to be well-positioned to serve and expand its customer base and create long-term value for its shareholders.”

Balance Sheet Management

Loans held for investment totaled $9.8 billion at December 31, 2020, reflecting an increase of 5.2% from the prior year.  At December 31, 2020, Trustmark’s gross PPP loans totaled $623.0 million.  Net of deferred fees and costs of $12.9 million, PPP loans totaled $610.1 million.  Collectively, loans held for investment and PPP loans totaled $10.4 billion at year end 2020, an increase of $1.1 billion, or 11.8% from the prior year.

Deposits totaled $14.0 billion at December 31, 2020, up $826.4 million, or 6.2%, from the prior quarter and $2.8 billion, or 24.9%, year-over-year primarily reflecting the impact of additional customer liquidity.  Noninterest bearing deposits represented 31.0% of total deposits at December 31, 2020.  Interest-bearing deposit costs totaled 0.27% for the fourth quarter, a decrease of 4 basis points linked-quarter.  The total cost of interest-bearing liabilities was 0.30% for the fourth quarter of 2020, a decrease of 3 basis points from the prior quarter.

Trustmark’s capital position remained solid, reflecting the strength and diversity of its financial services businesses.  During the fourth quarter of 2020, Trustmark Corporation issued $125 million of 3.625% fixed-to-floating rate subordinated notes due in 2030 for general corporate purposes, further strengthening its regulatory capital position.  At December 31, 2020, Trustmark’s tangible equity to tangible assets ratio was 8.34%, while the total risk-based capital ratio increased to 14.12%.

As previously announced, Trustmark’s Board of Directors authorized a stock repurchase program effective April 1, 2020, under which $100 million of Trustmark’s outstanding shares may be acquired through December 31, 2021.  While Trustmark suspended its share repurchase program during the first quarter of 2020 to preserve capital given the economic uncertainty associated with the COVID-19 pandemic, Trustmark expects to resume the repurchase of its shares from time to time at prevailing market prices, through open market or private transactions, depending on market conditions, and in conjunction with its disciplined share repurchase framework.  There is no guarantee as to the number of shares that may be repurchased by Trustmark, and Trustmark may discontinue purchases at any time at management’s discretion.

Credit Quality

Nonperforming loans totaled $63.1 million at December 31, 2020, an increase of $9.3 million from the prior quarter and $9.9 million year-over-year.  Other real estate totaled $11.7 million, reflecting a $4.6 million decrease from the prior quarter and a $17.6 million decline from the prior year.  Collectively, nonperforming assets totaled $74.8 million, reflecting a linked-quarter increase of 6.7% and year-over-year reduction of 9.3%.

Allocation of Trustmark’s $117.3 million allowance for credit losses on loans held for investment represented 1.20% of commercial loans and 1.16% of consumer and home mortgage loans, resulting in an allowance for credit losses to total loans held for investment of 1.19% at December 31, 2020, representing a level management considers commensurate with the present risk in the loan portfolio.