Trustmark(US:TRMK)2026-01-28 15:32Financial Data and Key Metrics Changes - Net income for the fourth quarter totaled $57.9 million, with diluted EPS of $0.97, reflecting a 3.2% increase linked-quarter and a 5.4% increase year-over-year [4] - For the full year, net income reached a record $224.1 million, with diluted EPS of $3.70, and adjusted continuing operations net income increased by $37.8 million, or 20.3% [4] - Return on average assets was 1.21% and return on average tangible equity was 12.97% [4] - Loans held for investment increased by $126 million, or 0.9% linked-quarter, and $584 million, or 4.5% year-over-year [4][5] - Total revenue for the fourth quarter was $204 million, while full-year revenue reached $800 million, marking a record for the company [7] Business Line Data and Key Metrics Changes - The mortgage banking business saw increased production and significant profitability improvements [3] - Wealth management revenue reached an all-time high, driven by improved asset values and new account acquisitions [3][32] - Non-interest income for the fourth quarter totaled $41 million, up 3.3% linked-quarter, and for the full year, it was $164 million, representing 20.5% of total revenue [8] Market Data and Key Metrics Changes - The deposit base declined by $131 million, or 0.8% linked-quarter, primarily due to a decrease in public fund deposits [5] - Year-over-year, deposits increased by $392 million, or 2.6%, driven by growth in commercial and personal balances [5] Company Strategy and Development Direction - The company aims for mid-single digit growth in loans held for investment and deposits for the full year 2026 [11] - The net interest margin is expected to be in the range of 3.8%-3.85% for 2026, with net interest income also anticipated to increase mid-single digits [11] - The company is focused on organic loan growth, potential market expansion, and M&A opportunities depending on market conditions [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining momentum into 2026, highlighting significant improvements in financial performance over recent years [12] - The company noted that credit quality has improved, with net charge-offs for 2025 at 13 basis points of average loans, and expects normalization of credit costs [20][22] Other Important Information - The board announced a 4.2% increase in the regular quarterly dividend to $0.25 per share, payable on March 15, 2026 [10] - The company repurchased $80 million of common stock during the year, including $43 million in the fourth quarter [7][10] Q&A Session Summary Question: Inquiry about new hires in the fourth quarter and talent acquisition strategy - Management reported 13 new production hires in the fourth quarter, focusing on organic expansion and improved loan growth [16][17] Question: Clarification on credit cost normalization and expectations for charge-offs - Management expects net charge-offs to stabilize at 13-15 basis points of average loans, with improvements in credit quality contributing to lower provisioning costs [20][22] Question: Discussion on guidance and key levers impacting growth - Loan growth and capital deployment were identified as key drivers for guidance, with management expressing confidence in maintaining solid loan growth while managing capital effectively [28][29] Question: Inquiry about expense growth cadence throughout the year - Management indicated that expense increases are typically higher in the second half of the year due to merit increases and performance-based bonuses [40][42] Question: Discussion on M&A activity and market opportunities - Management acknowledged increased discussions around M&A but emphasized a cautious and selective approach, focusing on organic growth while remaining open to opportunistic deals [45][51]