Trustmark Corp (TRMK) SEC Filing 10-Q Quarterly Report for the period ending Wednesday, June 30, 2021

Exhibit 99.1

Trustmark Corporation Announces Second Quarter 2021 Financial Results

Performance Reflects Continued Balance Sheet Growth, Strong Credit Quality and

Disciplined Expense Management

JACKSON, Miss. – July 27, 2021 – Trustmark Corporation (NASDAQGS: TRMK) reported net income of $48.0 million in the second quarter of 2021, representing diluted earnings per share of $0.76.  This level of earnings resulted in a return on average tangible equity of 13.96% and a return on average assets of 1.13%.  Trustmark’s Board of Directors declared a quarterly cash dividend of $0.23 per share payable September 15, 2021, to shareholders of record on September 1, 2021.

Second Quarter Highlights

Duane A. Dewey, President and CEO, stated, “Our associates are focused on expanding existing customer relationships as well as demonstrating the value Trustmark can provide potential customers as their trusted financial partner.  The success of these efforts is reflected in solid growth in our traditional banking and mortgage businesses as well as strong performance in our insurance and wealth management businesses.  Earlier this year, we introduced redesigned digital channels to enhance the customer experience and provide expanded sales capabilities, including on-line account openings.  Customers have embraced these offerings and we look forward to leveraging these new tools to expand relationships and profitably generate additional revenue.

“We are pleased to have been recognized during the second quarter by Forbes as the Best-in-State Bank in Mississippi in 2021, based upon independent customer satisfaction surveys.  This is affirmation that our associates are providing the financial solutions and convenience our customers’ desire,” said Dewey.    

Balance Sheet Management

Loans HFI totaled $10.2 billion at June 30, 2021, reflecting an increase of $169.2 million, or 1.7%, linked-quarter and $493.1 million, or 5.1%, year-over-year.  The linked-quarter growth primarily reflects increases in municipal loans, 1-4 family mortgage loans, loans secured by nonfarm, nonresidential properties, and construction loans, which were offset in part by a decline in other real estate secured loans.  Trustmark’s loan portfolio remains well-diversified by loan type and geography.

Deposits totaled $14.6 billion at June 30, 2021, up $248.6 million, or 1.7%, from the prior quarter and $1.1 billion, or 8.3%, year-over-year.  Trustmark continues to maintain a strong liquidity position as loans HFI represented 69.4% of total deposits at June 30, 2021.  Noninterest-bearing deposits represented 30.4% of total deposits at the end of the second quarter.  Interest-bearing deposit costs totaled 0.19% in the second quarter, a decrease of 3 basis points from the prior quarter. The total cost of interest-bearing liabilities was 0.25% in the second quarter of 2021, a decrease of 3 basis points from the prior quarter.

During the second quarter, Trustmark repurchased $20.8 million, or approximately 630 thousand of its common shares.  During the first six months of 2021, Trustmark repurchased $25.0 million, or approximately 775 thousand of its common shares.  At June 30, 2021, Trustmark had $75.0 million in remaining authority under its existing stock repurchase program, which expires on December 31, 2021.  The repurchase program, which is subject to market conditions and management discretion, will continue to be implemented through open market repurchases or privately negotiated transactions.  At June 30, 2021, Trustmark’s tangible equity-to-tangible assets ratio was 8.31% while its total risk-based capital ratio was 14.10%.  Tangible book value per share was $22.13 at June 30, 2021, up 2.5% linked-quarter and 9.7% year-over-year.

Credit Quality

Nonaccrual loans totaled $51.4 million at June 30, 2021, down $12.1 million from the prior quarter and up $1.5 million year-over-year.  Other real estate totaled $9.4 million, reflecting a $1.2 million decrease from the prior quarter and decline of $8.8 million year-over-year.  Collectively, nonperforming assets totaled $60.9 million at June 30, 2021, reflecting a linked-quarter decrease of $13.3 million and year-over-year decline of $7.4 million.

The provision for credit losses for loans HFI was a negative $4.0 million in the second quarter.  Negative provisioning was primarily driven by decreases in individually analyzed reserves, qualitative reserves due to improvements in credit quality, and improving economic forecasts.  The provision for credit losses for off-balance sheet credit exposures was $4.5 million in the second quarter.  Off-balance sheet expense was primarily driven by an increase in off-balance sheet exposure as well as the implementation of probability of default and loss given default floors at a portfolio level to ensure appropriate risk is reflected as macroeconomic conditions improve.  Collectively, the provision for credit losses totaled $537 thousand in the second quarter compared to negative $19.9 million in the prior quarter and expense of $24.4 million in the second quarter of 2020.