Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2020 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 000-03683 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Trustmark Corporation (Exact name of registrant as specified in its charter) Mississippi 64-0471500 (State or other jurisdiction ...

Trustmark Corporation (NASDAQ:TRMK) Q3 2020 Earnings Conference Call October 28, 2020 9:30 AM ET Company Participants Joey Rein – Director of Investor Relations Jerry Host – Chairman and Chief Executive Officer Barry Harvey – Chief Credit Officer Tom Owens – Bank Treasurer Duane Dewey – President and Chief Operating Officer Louis Greer – Chief Financial Officer Conference Call Participants Jennifer Demba – Truist Securities Catherine Mealor – KBW Graham Dick – Piper Sandler Operator Good morning, and welcom ...

Third Quarter 2020 Financial Results Forward–Looking Statements Certain statements contained in this document constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by words such as "may," "hope," "will," "should," "expect," "plan," "anticipate," "intend," "believe," "estimate," "predict," "project," "potential," "seek," "continue," "could," "would," "future" or the negative of those terms or other words o ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2020 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 000-03683 Trustmark Corporation (Exact name of registrant as specified in its charter) Mississippi 64-0471500 (State or other jurisdiction of incorporation or organization) (I.R. ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) Q1 2020 financial statements reflect lower net income due to increased credit loss provisions from CECL adoption and COVID-19, alongside asset growth [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to $14.02 billion by March 31, 2020, driven by loan and deposit growth, while shareholders' equity slightly decreased due to CECL adoption Consolidated Balance Sheet Highlights ($ in thousands) | Account | March 31, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Total Assets** | **$14,019,829** | **$13,497,877** | | Net LHFI and acquired loans | $9,467,356 | $9,323,137 | | Total Securities | $2,538,055 | $2,340,503 | | **Total Liabilities** | **$12,367,430** | **$11,837,175** | | Total Deposits | $11,575,764 | $11,245,557 | | **Total Shareholders' Equity** | **$1,652,399** | **$1,660,702** | - Effective January 1, 2020, Trustmark adopted FASB ASU 2016-13 (CECL) using the modified retrospective approach. As a result, prior period balances are presented under legacy GAAP and may not be directly comparable[11](index=11&type=chunk) [Consolidated Statements of Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income) Q1 2020 net income decreased to $22.2 million due to a surge in credit loss provisions, despite stable net interest income and strong mortgage banking-driven noninterest income growth Q1 Performance Summary ($ in thousands, except per share data) | Metric | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | Net Interest Income | $103,952 | $104,808 | | Provision for credit losses (PCL) | $20,581 | $1,611 | | Total Noninterest Income | $65,264 | $41,491 | | Total Noninterest Expense | $123,810 | $106,021 | | **Net Income** | **$22,218** | **$33,339** | | **Diluted EPS** | **$0.35** | **$0.51** | - Mortgage banking income was a key driver of noninterest income, increasing to **$27.5 million** in Q1 2020 from **$3.4 million** in Q1 2019[14](index=14&type=chunk) - Noninterest expense increased, partly due to a new **$6.8 million** credit loss expense related to off-balance sheet credit exposures, a requirement under the newly adopted CECL standard[14](index=14&type=chunk) [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail accounting policies, the impact of COVID-19 and CECL on credit losses, portfolio composition, legal contingencies, and segment performance [Management's Discussion and Analysis (MD&A)](index=58&type=section&id=ITEM%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) MD&A details COVID-19's impact, including increased credit loss expenses and customer support, resulting in lower Q1 2020 net income despite strong mortgage banking, with capital preservation measures - The COVID-19 pandemic and the adoption of the CECL accounting standard were the most significant factors impacting Q1 2020 results, leading to a total credit loss expense of **$27.4 million**[236](index=236&type=chunk)[252](index=252&type=chunk) - Trustmark is actively participating in the Paycheck Protection Program (PPP), securing over **$800 million** in SBA commitments for approximately **6,000** customers as of April 23, 2020[240](index=240&type=chunk) - In response to the pandemic, Trustmark modified **1,978** individual loans with aggregate principal balances of **$976.2 million** through April 23, 2020, providing concessions such as 90-day interest-only or full payment deferrals[238](index=238&type=chunk) Exposure to Stressed Industries (as of March 31, 2020) | Industry | Outstanding Balance | % of LHFI Portfolio | | :--- | :--- | :--- | | Restaurants | $116.0 million | 1.21% | | Hotels | $366.0 million | 3.83% | | Retail (CRE) | $505.0 million | 5.28% | | Energy | $131.7 million | 1.38% | [Results of Operations](index=67&type=section&id=Results%20of%20Operations) Q1 2020 total revenue increased to $169.2 million, driven by strong noninterest income from mortgage banking, despite net interest margin compression and a surge in credit loss provisions - Net interest margin decreased by **11 basis points** to **3.52%** in Q1 2020 compared to Q1 2019, primarily due to lower yields on loans, partially offset by lower costs of interest-bearing deposits[274](index=274&type=chunk) - Mortgage banking net income increased significantly to **$27.5 million** from **$3.4 million** YoY, driven by a **$9.9 million** positive net hedge ineffectiveness and a **$9.4 million** increase in gain on sales of loans[287](index=287&type=chunk)[288](index=288&type=chunk) - Salaries and employee benefits expense included a **$4.3 million** non-routine charge related to a voluntary early retirement program completed in Q1 2020[292](index=292&type=chunk) [Financial Condition](index=73&type=section&id=Financial%20Condition) As of March 31, 2020, total assets reached $14.02 billion, driven by growth in loans and deposits, while the Allowance for Credit Losses increased due to CECL and COVID-19 - LHFI increased by **$232.3 million** in Q1 2020, which includes a **$72.6 million** transfer of acquired loans reclassified as purchased credit deteriorated (PCD) loans upon adoption of CECL[318](index=318&type=chunk) - The ACL for LHFI increased to **$100.6 million** (**1.05%** of LHFI) at March 31, 2020, from **$84.3 million** (**0.90%** of LHFI) at December 31, 2019, reflecting the impact of CECL and the COVID-19 economic outlook[329](index=329&type=chunk) - Nonperforming assets, excluding acquired loans, decreased by **$4.6 million** to **$77.8 million**, representing **0.78%** of total loans and ORE, down from **0.86%** at year-end 2019[253](index=253&type=chunk)[336](index=336&type=chunk) [Capital Resources and Liquidity](index=84&type=section&id=Capital%20Resources%20and%20Liquidity) Trustmark maintained a solid capital position with all regulatory ratios exceeding well-capitalized standards, but suspended share repurchases to preserve capital amidst the pandemic Regulatory Capital Ratios (Trustmark Corporation) | Ratio | March 31, 2020 | Minimum Requirement | | :--- | :--- | :--- | | Common Equity Tier 1 | 11.35% | 7.00% | | Tier 1 Capital | 11.88% | 8.50% | | Total Capital | 12.78% | 10.50% | | Tier 1 Leverage | 10.21% | 4.00% | - Trustmark suspended its share repurchase programs on **March 9, 2020**, to preserve capital in response to the COVID-19 pandemic[362](index=362&type=chunk) - The company elected the five-year phase-in transition period for the regulatory capital effects of adopting CECL, mitigating its immediate impact on capital ratios[356](index=356&type=chunk) [PART II. OTHER INFORMATION](index=90&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=90&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) Trustmark's subsidiary, TNB, faces multiple lawsuits, including those related to Stanford Financial Group, which the company is contesting, believing no material adverse effect is probable - The company is involved in multiple lawsuits stemming from the collapse of the Stanford Financial Group, which are currently in pre-trial stages[407](index=407&type=chunk)[417](index=417&type=chunk) - A complaint was filed against TNB in **December 2019** by the receiver for Arthur Lamar Adams and Madison Timber Properties, LLC, seeking damages for allegedly enabling fraudulent activities[418](index=418&type=chunk) - Management has determined that a loss in any of the pending legal proceedings is not probable and cannot be reasonably estimated at this time[421](index=421&type=chunk) [Risk Factors](index=92&type=section&id=ITEM%201A.%20RISK%20FACTORS) New and heightened risks from COVID-19 include adverse impacts on business, increased credit losses, reduced net interest income from rate cuts, and litigation/credit risks from PPP participation - The COVID-19 pandemic poses a significant risk to business operations, customer financial health, loan demand, and could lead to increased credit losses and reduced net interest income[423](index=423&type=chunk)[425](index=425&type=chunk) - Recent interest rate cuts by the Federal Reserve to near-zero are expected to adversely affect the company's net interest income, margins, and profitability, especially if prolonged[426](index=426&type=chunk)[427](index=427&type=chunk) - Participation in the SBA's Paycheck Protection Program (PPP) introduces risks of litigation from customers over loan processing and potential credit losses if the SBA determines a deficiency in loan origination or servicing and denies its guaranty[429](index=429&type=chunk)[431](index=431&type=chunk) [Share Repurchases](index=94&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) Trustmark repurchased 886,958 shares for $27.5 million in Q1 2020 but suspended all repurchase programs on March 9, 2020, to preserve capital amidst the COVID-19 pandemic Share Repurchases for Q1 2020 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | Jan 2020 | 357,062 | $33.51 | | Feb 2020 | 338,800 | $30.84 | | Mar 2020 | 191,096 | $26.82 | | **Total** | **886,958** | **~ $31.05** | - On **March 9, 2020**, Trustmark suspended its share repurchase programs to preserve capital to support customers during the COVID-19 pandemic[435](index=435&type=chunk)

Part I [Item 1. Business](index=3&type=section&id=Item%201.%20Business) Trustmark Corporation, a bank holding company, offers diversified financial services across five states, focusing on customer relationships and credit risk management in a regulated environment [Description of Business](index=3&type=section&id=Description%20of%20Business) - Trustmark Corporation is a bank holding company headquartered in Jackson, Mississippi, with its principal subsidiary, Trustmark National Bank (TNB), representing approximately **99.99% of its consolidated assets** as of December 31, 2019[15](index=15&type=chunk) - The company operates as a financial services organization with **193 offices** and **2,844 full-time equivalent associates** across Alabama, Florida, Mississippi, Tennessee, and Texas[16](index=16&type=chunk) - Core services provided through TNB and its subsidiaries include Commercial Banking, Consumer Banking, Mortgage Banking, Insurance (via Fisher Brown Bottrell Insurance, Inc.), and Wealth Management (assisted by Trustmark Investment Advisors, Inc.)[17](index=17&type=chunk)[18](index=18&type=chunk)[19](index=19&type=chunk) Five-Year Financial Summary (2015-2019) | Metric | 2019 ($ in thousands) | 2018 ($ in thousands) | 2017 ($ in thousands) | 2016 ($ in thousands) | 2015 ($ in thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | | **Assets** | $13,497,877 | $13,286,460 | $13,797,953 | $13,352,333 | $12,678,896 | | **Loans*** | $9,408,229 | $8,942,800 | $8,831,484 | $8,123,460 | $7,481,796 | | **Deposits** | $11,245,557 | $11,364,411 | $10,577,512 | $10,056,012 | $9,588,230 | | **Equity** | $1,660,702 | $1,591,453 | $1,571,701 | $1,520,208 | $1,473,057 | | **Revenue** | $613,634 | $604,256 | $592,213 | $561,476 | $564,914 | [Overview of Lending Business](index=5&type=section&id=Overview%20of%20Lending%20Business) - Trustmark categorizes its loans into three main types: Loans Held for Investment (LHFI), Loans Held for Sale (LHFS), and Acquired Loans[27](index=27&type=chunk)[29](index=29&type=chunk) - The company mitigates credit risk through conservative underwriting, collateral monitoring, and oversight of borrower financial performance[30](index=30&type=chunk) - Construction, land development, and other land loans are considered higher risk due to factors like the absence of full collateral value at inception and the borrower's ability to complete projects on time and within budget[31](index=31&type=chunk)[32](index=32&type=chunk) - Commercial and industrial loans face credit risk from fluctuations in borrowers' financial conditions and market changes, while consumer loans generally pose heightened risks of collectability compared to other loan types[39](index=39&type=chunk)[41](index=41&type=chunk) [Recent Economic and Industry Developments](index=7&type=section&id=Recent%20Economic%20and%20Industry%20Developments) - The U.S. economy showed moderate improvement in 2019, but concerns remain due to volatile crude oil prices, uncertain global growth, and potential monetary policy changes by the Federal Reserve[44](index=44&type=chunk) - Federal Reserve Districts where Trustmark operates reported modest to solid economic expansion, tight labor markets, and stable to improving banking conditions, though the energy sector in the Dallas district remained distressed[46](index=46&type=chunk)[47](index=47&type=chunk) - The Federal Reserve lowered the federal funds rate three times in 2019, with persistently low interest rates continuing to pressure net interest margins[48](index=48&type=chunk) [Competition](index=8&type=section&id=Competition) - Trustmark faces significant competition from national, regional, and community banks, as well as nonbank financial institutions like credit unions, mortgage companies, and insurance companies[50](index=50&type=chunk)[51](index=51&type=chunk) FDIC Deposit Market Share by State (as of June 30, 2019) | State | Deposit Market Share | | :--- | :--- | | Alabama | 1.66% | | Florida | 0.17% | | Mississippi | 13.92% | | Tennessee | 0.36% | | Texas | 0.06% | - As of June 30, 2019, Trustmark's deposit market share ranked in the **top three in 55% of the 56 counties** it served[52](index=52&type=chunk) [Supervision and Regulation](index=9&type=section&id=Supervision%20and%20Regulation) - Trustmark is a registered bank holding company supervised by the Federal Reserve Board (FRB), and its primary bank subsidiary, TNB, is a national bank regulated by the Office of the Comptroller of the Currency (OCC)[58](index=58&type=chunk)[81](index=81&type=chunk) - The company is subject to stringent capital adequacy requirements under Basel III rules, and as of December 31, 2019, both Trustmark and TNB exceeded all minimum capital requirements and were considered **well-capitalized**[67](index=67&type=chunk)[68](index=68&type=chunk)[73](index=73&type=chunk) - As an institution with over **$10 billion in assets**, TNB is subject to supervision, examination, and enforcement by the Consumer Financial Protection Bureau (CFPB) regarding federal consumer financial laws[85](index=85&type=chunk) - Dividend payments from TNB to Trustmark are restricted by regulations, requiring OCC approval if total dividends in a calendar year exceed the sum of that year's net income and the retained net income from the preceding two years[84](index=84&type=chunk) [Item 1A. Risk Factors](index=17&type=section&id=Item%201A.%20Risk%20Factors) Trustmark faces key risks including interest rate, credit, liquidity, regulatory, operational, and competitive factors that could adversely affect its financial condition - Interest Rate Risk: Profitability is highly dependent on net interest income, with a hypothetical **100 basis point decrease** in interest rates estimated to decrease net interest income by **5.2%** as of December 31, 2019[108](index=108&type=chunk)[109](index=109&type=chunk) - Economic and Market Conditions: The business is susceptible to adverse conditions in financial markets and the general economy, including volatility in crude oil prices, which could impact loan performance and asset values[113](index=113&type=chunk)[115](index=115&type=chunk) - Lending and Credit Risk: Inherent risks in lending activities could impact the adequacy of the allowance for loan losses, with energy-related loans representing approximately **1.3% of the total LHFI portfolio** as of December 31, 2019[118](index=118&type=chunk)[115](index=115&type=chunk) - Regulatory and Capital Risk: The company is subject to extensive government regulation and stringent capital requirements (Basel III), and the adoption of CECL is expected to result in earlier recognition of credit losses, potentially increasing reserves and decreasing capital[123](index=123&type=chunk)[125](index=125&type=chunk)[127](index=127&type=chunk) - Operational and Cybersecurity Risk: Trustmark is dependent on information systems and vulnerable to operational disruptions, system breaches, and cyber-attacks, which could jeopardize confidential information and lead to financial losses[146](index=146&type=chunk) [Item 2. Properties](index=26&type=section&id=Item%202.%20Properties) Trustmark's principal offices are in Jackson, Mississippi, with 178 full-service branches, 236 ATMs, and 14 ITMs, owning most locations and leasing 32 sites - As of December 31, 2019, Trustmark operated **178 full-service branches**, **15 limited-service branches**, **236 ATMs**, and **14 interactive teller machines (ITMs)**[163](index=163&type=chunk) - The company leases **32 of its branch and other office locations**, with the remainder being owned[163](index=163&type=chunk) [Item 3. Legal Proceedings](index=26&type=section&id=Item%203.%20Legal%20Proceedings) Trustmark's subsidiary, TNB, faces lawsuits related to Stanford Financial Group and Madison Timber Properties, with management contesting and not expecting a material adverse effect - Trustmark's subsidiary, TNB, is a defendant in multiple lawsuits related to the collapse of the Stanford Financial Group, with claims including fraudulent transfers and conspiracy[164](index=164&type=chunk)[165](index=165&type=chunk) - In December 2019, TNB was named as a defendant in a complaint filed by the receiver for Arthur Lamar Adams and Madison Timber Properties, LLC, alleging that the bank's actions enabled fraudulent activities[176](index=176&type=chunk)[177](index=177&type=chunk) - Management is vigorously contesting all legal proceedings and currently believes that a loss is not probable or reasonably estimable, and the outcomes are not expected to have a material adverse effect on the company's consolidated financial condition[179](index=179&type=chunk) Part II [Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=28&type=section&id=Item%205.%20Market%20for%20the%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Trustmark's common stock trades on Nasdaq under 'TRMK,' paid **$0.92 per share** in 2019 dividends, and repurchased **1.8 million shares for $56.6 million** under active programs - Trustmark's common stock is listed on the Nasdaq Stock Market under the symbol **"TRMK"**[182](index=182&type=chunk) - The company paid quarterly cash dividends of **$0.23 per share**, totaling **$0.92 per share** for the full year 2019[182](index=182&type=chunk) - In 2019, Trustmark repurchased a total of approximately **1.8 million shares** of its common stock for **$56.6 million** under two separate authorizations[184](index=184&type=chunk)[185](index=185&type=chunk)[186](index=186&type=chunk) - A new stock repurchase program was authorized on January 28, 2020, allowing for the acquisition of up to **$100.0 million** of common stock from April 1, 2020, through December 31, 2021[187](index=187&type=chunk) [Item 6. Selected Financial Data](index=30&type=section&id=Item%206.%20Selected%20Financial%20Data) This section summarizes Trustmark's five-year consolidated financial data (2015-2019), showing **$613.6 million** revenue, **$150.5 million** net income, and **$2.32** diluted EPS in 2019 Consolidated Statements of Income Highlights (2015-2019) | Metric | 2019 ($ in thousands) | 2018 ($ in thousands) | 2017 ($ in thousands) | 2016 ($ in thousands) | 2015 ($ in thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | | **Net Interest Income** | $426,589 | $419,420 | $407,550 | $387,533 | $391,765 | | **Noninterest Income** | $187,045 | $184,836 | $184,663 | $173,943 | $173,149 | | **Net Income** | $150,460 | $149,584 | $105,630 | $108,411 | $116,038 | | **Diluted EPS** | $2.32 | $2.21 | $1.56 | $1.60 | $1.71 | Consolidated Balance Sheet Highlights (2015-2019) | Metric | 2019 ($ in thousands) | 2018 ($ in thousands) | 2017 ($ in thousands) | 2016 ($ in thousands) | 2015 ($ in thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | | **Total Assets** | $13,497,877 | $13,286,460 | $13,797,953 | $13,352,333 | $12,678,896 | | **Total Loans (incl LHFS)** | $9,634,576 | $9,096,599 | $9,011,996 | $8,299,387 | $7,641,985 | | **Deposits** | $11,245,557 | $11,364,411 | $10,577,512 | $10,056,012 | $9,588,230 | | **Total Shareholders' Equity** | $1,660,702 | $1,591,453 | $1,571,701 | $1,520,208 | $1,473,057 | Key Performance and Capital Ratios (2019) | Ratio | 2019 | 2018 | | :--- | :--- | :--- | | **Return on Average Equity** | 9.28% | 9.43% | | **Return on Average Assets** | 1.11% | 1.11% | | **Net Interest Margin (FTE)** | 3.62% | 3.54% | | **Tier 1 Leverage Ratio** | 10.48% | 10.26% | | **Total Risk-Based Capital Ratio** | 13.25% | 13.07% | [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=32&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2019, Trustmark achieved **$150.5 million** net income and **$2.32** diluted EPS, driven by increased net interest income, reduced loan loss provision, and **5.7%** LHFI growth 2019 vs. 2018 Financial Performance | Metric | 2019 ($ in millions) | 2018 ($ in millions) | Change | | :--- | :--- | :--- | :--- | | **Net Income** | $150.5 | $149.6 | +0.6% | | **Diluted EPS** | $2.32 | $2.21 | +5.0% | | **Total Revenue** | $613.6 | $604.3 | +1.5% | | **Net Interest Income** | $426.6 | $419.4 | +1.7% | | **Provision for Loan Losses, LHFI** | $10.8 | $18.0 | -40.0% | | **Noninterest Expense** | $429.0 | $415.4 | +3.3% | - Strategic focus in 2019 was on increasing revenue, optimizing the balance sheet, deploying capital via stock repurchases, and disciplined expense management[195](index=195&type=chunk) - Loans held for investment (LHFI) grew by **$499.8 million**, or **5.7%**, during 2019, while nonperforming assets (excluding acquired loans) decreased by **14.4%**[207](index=207&type=chunk)[208](index=208&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=65&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Trustmark manages interest rate risk using financial simulation models, projecting a **100 basis point increase** in rates to raise Net Interest Income by **3.0%** as of December 31, 2019 Interest Rate Sensitivity Analysis (as of Dec 31, 2019) | Change in Interest Rates | Estimated % Change in Net Interest Income | Estimated % Change in Net Portfolio Value (EVE) | | :--- | :--- | :--- | | +200 basis points | 5.7% | 5.3% | | +100 basis points | 3.0% | 3.4% | | -100 basis points | -5.2% | -7.7% | - The primary tools for measuring interest rate exposure are financial simulation models that simulate cash flows and accrual characteristics of the balance sheet under various rate scenarios[376](index=376&type=chunk) - The fair value of Mortgage Servicing Rights (MSR) was **$79.4 million** at year-end 2019, with a **10% adverse change** in prepayment speeds projected to decrease this value by approximately **$3.5 million**[383](index=383&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=67&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents Trustmark's audited consolidated financial statements (2017-2019), with Crowe LLP issuing an unqualified opinion on financial statements and internal control effectiveness - The independent auditor, Crowe LLP, issued an unqualified opinion on the consolidated financial statements and the effectiveness of internal control over financial reporting as of December 31, 2019[386](index=386&type=chunk) - The auditor identified the qualitative risk valuation allowance component of the Allowance for Loan Losses as a critical audit matter due to the significant and subjective judgment required by management[393](index=393&type=chunk)[394](index=394&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=141&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) No changes or disagreements with accountants on accounting principles, financial disclosure, or auditing matters occurred in the two years prior to December 31, 2019 - There has been no change of accountants within the two-year period prior to December 31, 2019[723](index=723&type=chunk) [Item 9A. Controls and Procedures](index=141&type=section&id=Item%209A.%20Controls%20and%20Procedures) As of December 31, 2019, management, including the CEO and PFO, concluded that disclosure controls and internal control over financial reporting were effective - Management, including the CEO and Principal Financial Officer, concluded that disclosure controls and procedures were effective as of the end of the period[724](index=724&type=chunk) - Management assessed internal control over financial reporting as effective as of December 31, 2019, using the COSO framework[726](index=726&type=chunk) Part III [Item 10. Directors, Executive Officers and Corporate Governance](index=142&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the 2020 Proxy Statement - Required information is incorporated by reference from the company's 2020 Proxy Statement[730](index=730&type=chunk) [Item 11. Executive Compensation](index=142&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation information is incorporated by reference from the 2020 Proxy Statement - Required information is incorporated by reference from the company's 2020 Proxy Statement[731](index=731&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=142&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) This section details equity compensation plans as of December 31, 2019, with other security ownership information incorporated by reference from the 2020 Proxy Statement Equity Compensation Plan Information (as of Dec 31, 2019) | Plan Category | Number of securities to be issued upon exercise (a) | Weighted-average exercise price of outstanding options (b) | Number of securities remaining available for future issuance (c) | | :--- | :--- | :--- | :--- | | **Equity compensation plans approved by security holders** | 149,914 | $ — | 908,818 | | **Equity compensation plans not approved by security holders** | — | — | — | | **Total** | **149,914** | **$ —** | **908,818** | [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=142&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information on certain relationships, related transactions, and director independence is incorporated by reference from the 2020 Proxy Statement - Required information is incorporated by reference from the company's 2020 Proxy Statement[735](index=735&type=chunk) [Item 14. Principal Accounting Fees and Services](index=142&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Principal accounting fees and services information is incorporated by reference from the 2020 Proxy Statement - Required information is incorporated by reference from the company's 2020 Proxy Statement[736](index=736&type=chunk) Part IV [Item 15. Exhibits, Financial Statement Schedules](index=143&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists Form 10-K exhibits and financial statements, with consolidated statements in Part II, Item 8, and required schedules omitted as inapplicable - The consolidated financial statements are included in Part II, Item 8 of the report[739](index=739&type=chunk) - Financial statement schedules required by Regulation S-X have been omitted as they are inapplicable or not required[740](index=740&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2019 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 000-03683 Trustmark Corporation (Exact name of registrant as specified in its charter) Mississippi 64-0471500 (State or other jurisdiction ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2019 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 000-03683 Trustmark Corporation (Exact name of registrant as specified in its charter) Mississippi 64-0471500 (State or other jurisdiction of in ...

PART I [Item 1. Financial Statements](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) Trustmark Corporation's unaudited consolidated financial statements, including balance sheets, income, and cash flow, are presented with detailed notes [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to **$13.48 billion** as of March 31, 2019, from **$13.29 billion** at December 31, 2018, driven by growth in net loans, with total liabilities also increasing and shareholders' equity seeing a slight decrease Consolidated Balance Sheet Highlights ($ in thousands) | Account | March 31, 2019 | December 31, 2018 | | :--- | :--- | :--- | | **Total Assets** | **$13,478,017** | **$13,286,460** | | Net LHFI and acquired loans | $9,007,913 | $8,862,279 | | Securities (AFS & HTM) | $2,607,764 | $2,721,456 | | Goodwill | $379,627 | $379,627 | | **Total Liabilities** | **$11,890,989** | **$11,695,007** | | Total deposits | $11,534,815 | $11,364,411 | | **Total Shareholders' Equity** | **$1,587,028** | **$1,591,453** | [Consolidated Statements of Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income) For the three months ended March 31, 2019, net income was **$33.3 million**, a decrease from **$36.8 million** in the same period of 2018, driven by lower noninterest income and higher noninterest expense, which offset an increase in net interest income Consolidated Income Statement Highlights ($ in thousands, except per share data) | Metric | Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | | :--- | :--- | :--- | | Net Interest Income | $104,808 | $102,093 | | Provision for Loan Losses | $1,689 | $4,111 | | Total Noninterest Income | $41,491 | $46,793 | | Total Noninterest Expense | $106,021 | $102,465 | | **Net Income** | **$33,339** | **$36,830** | | **Diluted EPS** | **$0.51** | **$0.54** | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the first three months of 2019, net cash from operating activities was **$14.9 million**, a significant decrease from **$57.8 million** in the prior year period, resulting in a net increase in cash and cash equivalents of **$104.5 million** Consolidated Cash Flow Summary ($ in thousands) | Activity | Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | | :--- | :--- | :--- | | Net cash from operating activities | $14,872 | $57,773 | | Net cash from investing activities | ($23,036) | $263,123 | | Net cash from financing activities | $112,650 | ($341,388) | | **Net change in cash and cash equivalents** | **$104,486** | **($20,492)** | [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Detailed disclosures on Trustmark's accounting policies and financial items, covering key areas like securities, loans, and regulatory capital [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=50&type=section&id=ITEM%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses Trustmark's Q1 2019 financial condition and results, covering performance, balance sheet, liquidity, and capital resources - Trustmark's Q1 2019 **net income decreased to $33.3 million from $36.8 million** year-over-year, mainly due to a **$3.6 million increase in noninterest expense** and a **$2.6 million decrease in total revenue**, partially offset by a lower provision for loan losses[194](index=194&type=chunk) - Total revenue (Net Interest Income + Noninterest Income) **fell by 1.7% YoY to $146.3 million**, driven by a significant decline in mortgage banking income due to net negative hedge ineffectiveness[196](index=196&type=chunk) - Loans held for investment (LHFI) **grew by $159.1 million (1.8%)** during the quarter, and deposits **increased by $170.4 million (1.5%)**[190](index=190&type=chunk) - Nonperforming assets (excluding acquired loans) **decreased by $7.7 million (8.0%) from year-end 2018 to $88.6 million**, reflecting improved credit quality[200](index=200&type=chunk) [Results of Operations](index=55&type=section&id=Results%20of%20Operations) In Q1 2019, net interest income (FTE) rose **2.6% YoY to $108.0 million**, with the net interest margin expanding **17 basis points to 3.63%**, while noninterest income fell **11.3% to $41.5 million** and noninterest expense increased **3.5% to $106.0 million** Key Operating Metrics Comparison ($ in thousands) | Metric | Q1 2019 | Q1 2018 | | :--- | :--- | :--- | | Net Interest Income (FTE) | $108,039 | $105,308 | | Net Interest Margin (FTE) | 3.63% | 3.46% | | Provision for Loan Losses, Net | $1,689 | $4,111 | | Noninterest Income | $41,491 | $46,793 | | Noninterest Expense | $106,021 | $102,465 | - The decrease in mortgage banking net income was the primary driver of lower noninterest income, falling to **$3.4 million from $11.3 million YoY**, mainly due to a **net negative hedge ineffectiveness of $4.7 million** in Q1 2019 versus a positive **$3.3 million** in Q1 2018[228](index=228&type=chunk)[229](index=229&type=chunk) [Financial Condition](index=63&type=section&id=Financial%20Condition) As of March 31, 2019, Trustmark's financial condition remained solid with total assets at **$13.48 billion**, a securities portfolio of **$2.61 billion**, and loans held for investment (LHFI) growing **1.8% to $9.0 billion**, while nonperforming assets continued to decline - The securities portfolio is high quality, with approximately **97% invested in GSE-backed obligations and other Aaa-rated securities**[253](index=253&type=chunk) - LHFI growth was led by a **$153.2 million (14.5%) increase** in construction, land development, and other land loans during the quarter[260](index=260&type=chunk) - The allowance for loan losses to total LHFI was **0.88% at March 31, 2019**, compared to **0.90% at December 31, 2018**[269](index=269&type=chunk) [Capital Resources and Liquidity](index=71&type=section&id=Capital%20Resources%20and%20Liquidity) Trustmark maintained a strong capital and liquidity position, with all regulatory capital ratios significantly exceeding 'well-capitalized' minimums, and a new **$100 million** share repurchase program authorized Regulatory Capital Ratios | Ratio | March 31, 2019 | Minimum Requirement | | :--- | :--- | :--- | | Common Equity Tier 1 | 11.88% | 7.000% | | Tier 1 Capital | 12.45% | 8.500% | | Total Capital | 13.21% | 10.500% | | Tier 1 Leverage | 10.05% | 4.00% | - Trustmark repurchased **1.2 million shares for $36.9 million** in Q1 2019, completing its 2016-authorized program; a new **$100 million repurchase program** was authorized for April 1, 2019, to March 31, 2020[138](index=138&type=chunk)[139](index=139&type=chunk)[293](index=293&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=75&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) This section refers to the 'Market/Interest Rate Risk Management' discussion within Item 2, indicating that a **+100 basis point** parallel shift in interest rates would increase net interest income by an estimated **1.1%**, while a **-100 basis point** shift would decrease it by **1.8%** Estimated % Change in Net Interest Income (1-Year Horizon) | Change in Interest Rates | 2019 Estimate | | :--- | :--- | | +200 basis points | 2.0% | | +100 basis points | 1.1% | | -100 basis points | -1.8% | [Item 4. Controls and Procedures](index=77&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2019, with no material changes to internal control over financial reporting during the first quarter - The CEO and Principal Financial Officer concluded that Trustmark's **disclosure controls and procedures were effective** as of the end of the reporting period[332](index=332&type=chunk) - No **material changes** were made to internal controls over financial reporting during the quarter[333](index=333&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=77&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) Trustmark's subsidiary, TNB, faces three lawsuits related to the Stanford Financial Group collapse, with management deeming a material loss not probable - Trustmark is involved in **three lawsuits related to the Stanford Financial Group collapse**, with claims including fraudulent transfer and conspiracy[334](index=334&type=chunk) - Management states that a loss from these proceedings is **not considered probable or reasonably estimable** at this time[343](index=343&type=chunk) [Item 1A. Risk Factors](index=78&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company states that there have been no material changes in the risk factors from those disclosed in its Annual Report on Form 10-K for the fiscal year ended December 31, 2018 - No **material changes to risk factors** were reported since the last Annual Report on Form 10-K[344](index=344&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=79&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) During Q1 2019, Trustmark repurchased **1,168,273 shares** of common stock, completing a **$100.0 million** program, and authorized a new **$100.0 million** stock repurchase program effective April 1, 2019 Share Repurchases for Q1 2019 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | January 2019 | 734,955 | $30.12 | | February 2019 | 111,669 | $34.52 | | March 2019 | 321,649 | $33.82 | | **Total** | **1,168,273** | **N/A** | - A new **$100.0 million stock repurchase program** was authorized, effective April 1, 2019, through March 31, 2020[346](index=346&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 for the fiscal year ended December 31, 2018 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 000-3683 TRUSTMARK CORPORATION (Exact name of Registrant as specified in its charter) | MISSISSIPPI | 64-0471500 | | --- | --- | | (State or other jurisdiction of incorporation or or ...