trmk-ex991

JACKSON, Miss. – April 25, 2017 – Trustmark Corporation (NASDAQ:TRMK) reported net income of $31.2 million in the first quarter of 2017, representing diluted earnings per share of $0.46. Diluted earnings per share in the first quarter of 2017 increased 7.0% when compared to the previous quarter and 15.0% when compared to the same period in the prior year. This level of earnings resulted in a return on average tangible common equity of 11.39% and a return on average assets of 0.95%. Trustmark’s Board of Directors declared a quarterly cash dividend of $0.23 per share payable June 15, 2017, to shareholders of record on June 1, 2017.

Gerard R. Host, President and CEO, stated, “The first quarter marked a great start to 2017 for Trustmark. We maintained and expanded customer relationships by growing loans across our franchise while continuing to maintain solid credit quality. Our low-cost, core deposit base remains a significant strength of the organization. The strong performance of our mortgage and insurance businesses was reflected in solid noninterest income growth. While we continued to make investments to enhance the customer experience, we maintained our focus on disciplined expense management. We recently welcomed the associates and customers of Reliance Bank to the Trustmark family with the completion of our previously announced merger on April 7. We are delighted to serve the greater Huntsville, Alabama, market and look forward to their contributions going forward. Thanks to our talented associates, solid profitability and strong capital base, Trustmark remains well positioned to continue meeting the needs of our customers and creating long-term value for our shareholders.”

Loans held for investment totaled $8.0 billion at March 31, 2017, an increase of 2.0% from the prior quarter and 10.1% from the comparable period one year earlier. During the first quarter of 2017, Trustmark reclassified $36.7 million of acquired loans to loans held for investment due to the discount on these loans being fully amortized. Excluding this reclassification, loans held for investment increased $116.7 million, or 1.5% from the prior quarter and 9.6% from the comparable period one year earlier.

The following discussion of loan growth excludes the aforementioned reclassified acquired loans. Other real estate secured loans, which include multifamily projects, expanded $79.8 million, which was a result of the migration of construction loans as projects were completed. Construction and land development loans grew $28.0 million, primarily due to increased construction in Alabama. Nonfarm-nonresidential loans increased $26.2 million, primarily due to strength in Alabama and Florida. Other loans, which include loans to nonprofits and real estate investment trusts, increased $11.4 million, driven principally by growth in Alabama, Texas and Mississippi. Single-family home loans decreased $14.2 million as growth in Alabama and Florida was more than offset by declines in Mississippi and Tennessee. State and other political loans decreased $7.0 million as growth in Texas and Alabama was more than offset by declines in Mississippi and Tennessee.

Acquired loans totaled $218.2 million at March 31, 2017, down $54.0 million from the prior quarter, primarily due to the previously mentioned reclassification of $36.7 million of acquired loans to loans held for investment. Collectively, loans held for investment and acquired loans totaled $8.2 billion at March 31, 2017, up $99.4 million, or 1.2%, from the prior quarter.

Deposits totaled $10.1 billion at March 31, 2017, remaining stable from the prior quarter. Trustmark continues to maintain an attractive, low-cost deposit base with approximately 60% of deposit balances in checking accounts and a total cost of deposits of 0.16%. The cost of interest-bearing liabilities was 0.34% for the first quarter of 2017.

Trustmark’s capital position remained solid, reflecting the consistent profitability of its diversified financial services businesses. At March 31, 2017, Trustmark’s tangible equity to tangible assets ratio was 8.80%, while the total risk-based capital ratio was 13.61%.

Nonperforming loans totaled $61.3 million at March 31, 2017, up 24.5% from the prior quarter and down 13.3% year-over-year; the linked-quarter increase was primarily a result of one substandard energy- related credit migrating to nonaccrual status. Other real estate totaled $56.0 million, reflecting a decline of 9.8% from the previous quarter and 22.1% from the same period one year earlier. Collectively, nonperforming assets totaled $117.3 million, reflecting a linked-quarter increase of 5.4% and year-over-year decrease of 17.7%.

Allocation of Trustmark's $72.4 million allowance for loan losses represented 0.97% of commercial loans and 0.67% of consumer and home mortgage loans, resulting in an allowance to total loans held for investment of 0.91% at March 31, 2017, representing a level management considers commensurate with the inherent risk in the loan portfolio. Collectively, the allowance for both held for investment and acquired loan losses represented 1.00% of total loans, which include held for investment and acquired loans.

Unless noted otherwise, all of the above credit quality metrics exclude acquired loans and other real estate covered by FDIC loss-share agreement.

Net interest income (FTE) in the first quarter totaled $102.4 million, resulting in a net interest margin of 3.49%, down 3 basis points from the prior quarter. Relative to the prior quarter, net interest income (FTE) decreased $1.1 million as growth in interest income from both the held for sale and held for investment loan portfolios was more than offset by decreased interest income from the acquired loan portfolio as well as increased total interest expense. The yield on acquired loans in the first quarter totaled 8.40% and included recoveries from settlement of debt of $1.2 million; this compares to $3.8 million in recoveries from settlement of debt in the prior quarter. Excluding acquired loans, the net interest margin in the first quarter totaled 3.38%, an increase of 7 basis points when compared to the fourth quarter of 2016. The increase was primarily due to growth in the yields on the securities portfolio and the loans held for investment and held for sale portfolios.

Noninterest income in the first quarter increased 10.3% from the prior quarter to total $46.0 million, as higher mortgage banking revenues and insurance commissions more than offset seasonal reductions in various fee-income categories. Mortgage banking revenue totaled $10.2 million in the first quarter, up $4.8 million from the prior quarter and $1.5 million year-over-year. The linked-quarter change reflects a net positive mortgage valuation adjustment and a net positive mortgage servicing hedge ineffectiveness that more than offset decreased secondary marketing gains. Mortgage loan production totaled $303.5 million, down 25.4% from the prior quarter and 1.3% year-over-year. Insurance revenue totaled $9.2 million in the first quarter, up 8.9% from the prior quarter and 7.2% year-over-year; this performance primarily reflects growth in the group health insurance and property and casualty businesses.

Wealth management revenue in the first quarter totaled $7.4 million, down 1.2% and up 0.1% from the prior quarter and year-over-year, respectively. The linked-quarter decline is primarily attributable to decreased commission-based transactions within investment services. Bank card and other fees declined $296 thousand from the prior quarter due to seasonal reductions in interchange income and lower revenue on interest rate swaps for commercial loan customers. Service charges on deposit accounts declined $612 thousand from the prior quarter, reflecting seasonal reductions in NSF and overdraft fees.

Salaries and benefits decreased $866 thousand from the prior quarter to total $57.3 million. Services and fees increased 3.9%, or $581 thousand, linked quarter primarily due to additional advertising and outside services expense. ORE and foreclosure expense totaled $1.8 million, up from the prior quarter, while net occupancy-premises expense totaled $6.2 million, down 2.9% from the prior quarter. Other expense totaled $12.8 million, up $1.1 million on a linked-quarter basis, primarily due to a property valuation adjustment associated with a branch closure and other miscellaneous expenses.

Trustmark remains committed to diligent expense management. As previously announced, Trustmark terminated its defined benefit pension plan as of December 31, 2016. In order to terminate the plan, Trustmark is required to fully fund the plan on a termination basis and will contribute the additional assets necessary to do so. The final distributions will be made from current plan assets and a one-time pension settlement expense of approximately $17.5 million (pre-tax) will be recognized when paid by Trustmark during the second quarter of 2017. After the distribution of plan assets during the second quarter of 2017, Trustmark estimates that the annual pension expense will be reduced by $3.0 million to $4.0 million.

As previously announced, Trustmark will conduct a conference call with analysts on Wednesday, April 26, 2017, at 10:00 a.m. Central Time to discuss the Corporation’s financial results. Interested parties may listen to the conference call by dialing (877) 317-3051 or by clicking on the link provided under the Investor Relations section of our website at www.trustmark.com, which will also include a slide presentation Management will review during the conference call. A replay of the conference call will also be available through Wednesday, May 10, 2017, in archived format at the same web address or by calling (877) 344-7529, passcode 10103777.

Trustmark Corporation is a financial services company providing banking and financial solutions through 200 offices in Alabama, Florida, Mississippi, Tennessee and Texas.

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,” “potential,” “continue,” “could,” “future” or the negative of those terms or other words of similar meaning. You should read statements that contain these words carefully because they discuss our future expectations or state other “forward-looking” information. These forward-looking statements include, but are not limited to, statements relating to anticipated future operating and financial performance measures, including net interest margin, credit quality, business initiatives, growth opportunities and growth rates, among other things, and encompass any estimate, prediction, expectation, projection, opinion, anticipation, outlook or statement of belief included therein as well as the management assumptions underlying these forward-looking statements. You should be aware that the occurrence of the events described under the caption “Risk Factors” in Trustmark’s filings with the Securities and Exchange Commission could have an adverse effect on our business, results of operations and financial condition. Should one or more of these risks materialize, or should any such underlying assumptions prove to be significantly different, actual results may vary significantly from those anticipated, estimated, projected or expected.

Risks that could cause actual results to differ materially from current expectations of Management include, but are not limited to, changes in the level of nonperforming assets and charge-offs, local, state and national economic and market conditions, including conditions in the housing and real estate markets in the regions in which Trustmark operates and the extent and duration of the current volatility in the credit and financial markets as well as crude oil prices, changes in our ability to measure the fair value of assets in our portfolio, material changes in the level and/or volatility of market interest rates, the performance and demand for the products and services we offer, including the level and timing of withdrawals from our deposit accounts, the costs and effects of litigation and of unexpected or adverse outcomes in such litigation, our ability to attract noninterest-bearing deposits and other low-cost funds, competition in loan and deposit pricing, as well as the entry of new competitors into our markets through de novo expansion and acquisitions, economic conditions, including the potential impact of issues relating to the European financial system and monetary and other governmental actions designed to address the level and volatility of interest rates and the volatility of securities, currency and other markets, the enactment of legislation and changes in existing regulations or enforcement practices or the adoption of new regulations, changes in accounting standards and practices, including changes in the interpretation of existing standards, that affect our consolidated financial statements, changes in consumer spending, borrowings and savings habits, technological changes, changes in the financial performance or condition of our borrowers, changes in our ability to control expenses, changes in our compensation and benefit plans, including those associated with the planned termination of our noncontributory tax-qualified defined benefit pension plan, greater than expected costs or difficulties related to the integration of acquisitions or new products and lines of business, cyber-attacks and other breaches which could affect our information system security, natural disasters, environmental disasters, acts of war or terrorism, and other risks described in our filings with the Securities and Exchange Commission.

Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Except as required by law, we undertake no obligation to update or revise any of this information, whether as the result of new information, future events or developments or otherwise.

										Linked Quarter						Year over Year
QUARTERLY AVERAGE BALANCES	3/31/2017			12/31/2016			3/31/2016			$ Change			% Change			$ Change			% Change
Securities AFS-taxable	$	2,252,162		$	2,271,503		$	2,211,479		$	(19,341	)		-0.9	%	$	40,683			1.8	%
Securities AFS-nontaxable		88,522			91,495			105,844			(2,973	)		-3.2	%		(17,322	)		-16.4	%
Securities HTM-taxable		1,124,692			1,101,382			1,142,434			23,310			2.1	%		(17,742	)		-1.6	%
Securities HTM-nontaxable		33,009			33,675			35,841			(666	)		-2.0	%		(2,832	)		-7.9	%
Total securities		3,498,385			3,498,055			3,495,598			330			0.0	%		2,787			0.1	%
Loans (including loans held for sale)		8,074,449			7,855,444			7,346,333			219,005			2.8	%		728,116			9.9	%
Acquired loans		250,482			282,197			378,435			(31,715	)		-11.2	%		(127,953	)		-33.8	%
Fed funds sold and rev repos		397			1,418			382			(1,021	)		-72.0	%		15			3.9	%
Other earning assets		79,515			80,608			66,702			(1,093	)		-1.4	%		12,813			19.2	%
Total earning assets		11,903,228			11,717,722			11,287,450			185,506			1.6	%		615,778			5.5	%
Allowance for loan losses		(83,394	)		(82,604	)		(81,138	)		(790	)		1.0	%		(2,256	)		2.8	%
Cash and due from banks		310,542			314,420			281,912			(3,878	)		-1.2	%		28,630			10.2	%
Other assets		1,235,469			1,238,029			1,253,282			(2,560	)		-0.2	%		(17,813	)		-1.4	%
Total assets	$	13,365,845		$	13,187,567		$	12,741,506		$	178,278			1.4	%	$	624,339			4.9	%

Interest-bearing demand deposits	$	1,981,982		$	1,920,273		$	1,866,043		$	61,709			3.2	%	$	115,939			6.2	%
Savings deposits		3,319,572			3,049,733			3,188,916			269,839			8.8	%		130,656			4.1	%
Time deposits		1,650,251			1,638,853			1,677,576			11,398			0.7	%		(27,325	)		-1.6	%
Total interest-bearing deposits		6,951,805			6,608,859			6,732,535			342,946			5.2	%		219,270			3.3	%
Fed funds purchased and repos		498,963			494,193			517,180			4,770			1.0	%		(18,217	)		-3.5	%
Short-term borrowings		887,848			435,576			413,616			452,272		n/m				474,232		n/m
Long-term FHLB advances		251,033			685,844			501,144			(434,811	)		-63.4	%		(250,111	)		-49.9	%
Subordinated notes		—			40,757			49,972			(40,757	)		-100.0	%		(49,972	)		-100.0	%
Junior subordinated debt securities		61,856			61,856			61,856			—			0.0	%		—			0.0	%
Total interest-bearing liabilities		8,651,505			8,327,085			8,276,303			324,420			3.9	%		375,202			4.5	%
Noninterest-bearing deposits		3,008,176			3,160,959			2,836,283			(152,783	)		-4.8	%		171,893			6.1	%
Other liabilities		173,066			166,379			134,236			6,687			4.0	%		38,830			28.9	%
Total liabilities		11,832,747			11,654,423			11,246,822			178,324			1.5	%		585,925			5.2	%
Shareholders' equity		1,533,098			1,533,144			1,494,684			(46	)		0.0	%		38,414			2.6	%
Total liabilities and equity	$	13,365,845		$	13,187,567		$	12,741,506		$	178,278			1.4	%	$	624,339			4.9	%

n/m - percentage changes greater than +/- 100% are considered not meaningful

										Linked Quarter						Year over Year
PERIOD END BALANCES	3/31/2017			12/31/2016			3/31/2016			$ Change			% Change			$ Change			% Change
Cash and due from banks	$	379,590		$	327,706		$	228,498		$	51,884			15.8	%	$	151,092			66.1	%
Fed funds sold and rev repos		500			500			—			—			0.0	%		500		n/m
Securities available for sale		2,365,554			2,356,682			2,368,120			8,872			0.4	%		(2,566	)		-0.1	%
Securities held to maturity		1,156,067			1,158,643			1,168,203			(2,576	)		-0.2	%		(12,136	)		-1.0	%
Loans held for sale (LHFS)		174,090			175,927			191,028			(1,837	)		-1.0	%		(16,938	)		-8.9	%
Loans held for investment (LHFI)		8,004,657			7,851,213			7,268,022			153,444			2.0	%		736,635			10.1	%
Allowance for loan losses		(72,445	)		(71,265	)		(69,668	)		(1,180	)		1.7	%		(2,777	)		4.0	%
Net LHFI		7,932,212			7,779,948			7,198,354			152,264			2.0	%		733,858			10.2	%
Acquired loans		218,242			272,247			364,755			(54,005	)		-19.8	%		(146,513	)		-40.2	%
Allowance for loan losses, acquired loans		(10,006	)		(11,397	)		(13,535	)		1,391			-12.2	%		3,529			-26.1	%
Net acquired loans		208,236			260,850			351,220			(52,614	)		-20.2	%		(142,984	)		-40.7	%
Net LHFI and acquired loans		8,140,448			8,040,798			7,549,574			99,650			1.2	%		590,874			7.8	%
Premises and equipment, net		183,311			184,987			194,453			(1,676	)		-0.9	%		(11,142	)		-5.7	%
Mortgage servicing rights		82,758			80,239			68,208			2,519			3.1	%		14,550			21.3	%
Goodwill		366,156			366,156			366,156			—			0.0	%		—			0.0	%
Identifiable intangible assets		19,117			20,680			25,751			(1,563	)		-7.6	%		(6,634	)		-25.8	%
Other real estate		55,968			62,051			72,302			(6,083	)		-9.8	%		(16,334	)		-22.6	%
Other assets		566,802			577,964			542,903			(11,162	)		-1.9	%		23,899			4.4	%
Total assets	$	13,490,361		$	13,352,333		$	12,775,196		$	138,028			1.0	%	$	715,165			5.6	%

Deposits:
Noninterest-bearing	$	3,209,727		$	2,973,238		$	2,874,306		$	236,489			8.0	%	$	335,421			11.7	%
Interest-bearing		6,894,745			7,082,774			6,759,337			(188,029	)		-2.7	%		135,408			2.0	%
Total deposits		10,104,472			10,056,012			9,633,643			48,460			0.5	%		470,829			4.9	%
Fed funds purchased and repos		524,335			539,817			466,436			(15,482	)		-2.9	%		57,899			12.4	%
Short-term borrowings		864,690			769,778			411,385			94,912			12.3	%		453,305		n/m
Long-term FHLB advances		250,994			251,049			501,124			(55	)		0.0	%		(250,130	)		-49.9	%
Subordinated notes		—			—			49,977			—		n/m				(49,977	)		-100.0	%
Junior subordinated debt securities		61,856			61,856			61,856			—			0.0	%		—			0.0	%
Other liabilities		146,053			153,613			142,519			(7,560	)		-4.9	%		3,534			2.5	%
Total liabilities		11,952,400			11,832,125			11,266,940			120,275			1.0	%		685,460			6.1	%
Common stock		14,112			14,091			14,093			21			0.1	%		19			0.1	%
Capital surplus		365,951			366,563			363,979			(612	)		-0.2	%		1,972			0.5	%
Retained earnings		1,200,903			1,185,352			1,151,757			15,551			1.3	%		49,146			4.3	%
Accum other comprehensive loss, net of tax		(43,005	)		(45,798	)		(21,573	)		2,793			-6.1	%		(21,432	)		99.3	%
Total shareholders' equity		1,537,961			1,520,208			1,508,256			17,753			1.2	%		29,705			2.0	%
Total liabilities and equity	$	13,490,361		$	13,352,333		$	12,775,196		$	138,028			1.0	%	$	715,165			5.6	%

n/m - percentage changes greater than +/- 100% are considered not meaningful

	Quarter Ended								Linked Quarter						Year over Year
INCOME STATEMENTS	3/31/2017			12/31/2016		3/31/2016			$ Change			% Change			$ Change			% Change
Interest and fees on LHFS & LHFI-FTE	$	83,790		$	81,346	$	76,235		$	2,444			3.0	%	$	7,555			9.9	%
Interest and fees on acquired loans		5,189			8,290		7,022			(3,101	)		-37.4	%		(1,833	)		-26.1	%
Interest on securities-taxable		19,197			18,775		20,086			422			2.2	%		(889	)		-4.4	%
Interest on securities-tax exempt-FTE		1,300			1,340		1,497			(40	)		-3.0	%		(197	)		-13.2	%
Interest on fed funds sold and rev repos		1			4		1			(3	)		-75.0	%		—			0.0	%
Other interest income		267			335		230			(68	)		-20.3	%		37			16.1	%
Total interest income-FTE		109,744			110,090		105,071			(346	)		-0.3	%		4,673			4.4	%
Interest on deposits		3,945			3,380		3,038			565			16.7	%		907			29.9	%
Interest on fed funds pch and repos		698			471		431			227			48.2	%		267			61.9	%
Other interest expense		2,673			2,662		2,389			11			0.4	%		284			11.9	%
Total interest expense		7,316			6,513		5,858			803			12.3	%		1,458			24.9	%
Net interest income-FTE		102,428			103,577		99,213			(1,149	)		-1.1	%		3,215			3.2	%
Provision for loan losses, LHFI		2,762			1,834		2,243			928			50.6	%		519			23.1	%
Provision for loan losses, acquired loans		(1,605	)		1,150		1,309			(2,755	)	n/m				(2,914	)	n/m
Net interest income after provision-FTE		101,271			100,593		95,661			678			0.7	%		5,610			5.9	%
Service charges on deposit accounts		10,832			11,444		11,081			(612	)		-5.3	%		(249	)		-2.2	%
Bank card and other fees		6,500			6,796		6,918			(296	)		-4.4	%		(418	)		-6.0	%
Mortgage banking, net		10,185			5,428		8,699			4,757			87.6	%		1,486			17.1	%
Insurance commissions		9,212			8,459		8,593			753			8.9	%		619			7.2	%
Wealth management		7,413			7,505		7,407			(92	)		-1.2	%		6			0.1	%
Other, net		1,891			2,092		888			(201	)		-9.6	%		1,003		n/m
Nonint inc-excl sec gains (losses), net		46,033			41,724		43,586			4,309			10.3	%		2,447			5.6	%
Security gains (losses), net		—			—		(310	)		—		n/m				310			-100.0	%
Total noninterest income		46,033			41,724		43,276			4,309			10.3	%		2,757			6.4	%
Salaries and employee benefits		57,302			58,168		57,201			(866	)		-1.5	%		101			0.2	%
Services and fees		15,332			14,751		14,475			581			3.9	%		857			5.9	%
Net occupancy-premises		6,238			6,426		6,188			(188	)		-2.9	%		50			0.8	%
Equipment expense		5,998			6,172		6,094			(174	)		-2.8	%		(96	)		-1.6	%
Other real estate expense		1,759			525		181			1,234		n/m				1,578		n/m
FDIC assessment expense		2,640			2,562		2,811			78			3.0	%		(171	)		-6.1	%
Other expense		12,788			11,663		11,994			1,125			9.6	%		794			6.6	%
Total noninterest expense		102,057			100,267		98,944			1,790			1.8	%		3,113			3.1	%
Income before income taxes and tax eq adj		45,247			42,050		39,993			3,197			7.6	%		5,254			13.1	%
Tax equivalent adjustment		4,838			4,725		4,473			113			2.4	%		365			8.2	%
Income before income taxes		40,409			37,325		35,520			3,084			8.3	%		4,889			13.8	%
Income taxes		9,161			8,402		8,517			759			9.0	%		644			7.6	%
Net income	$	31,248		$	28,923	$	27,003		$	2,325			8.0	%	$	4,245			15.7	%

Per share data
Earnings per share - basic	$	0.46		$	0.43	$	0.40		$	0.03			7.0	%	$	0.06			15.0	%

Earnings per share - diluted	$	0.46		$	0.43	$	0.40		$	0.03			7.0	%	$	0.06			15.0	%

Dividends per share	$	0.23		$	0.23	$	0.23			—			0.0	%		—			0.0	%

Weighted average shares outstanding
Basic		67,687,365			67,627,496		67,609,662

Diluted		67,845,785			67,817,770		67,746,592

Period end shares outstanding		67,729,434			67,628,618		67,639,832

n/m - percentage changes greater than +/- 100% are considered not meaningful

	Quarter Ended									Linked Quarter						Year over Year
NONPERFORMING ASSETS (1)	3/31/2017			12/31/2016			3/31/2016			$ Change			% Change			$ Change			% Change
Nonaccrual loans
Alabama	$	1,649		$	665		$	1,788		$	984		n/m			$	(139	)		-7.8	%
Florida		3,559			3,644			4,952			(85	)		-2.3	%		(1,393	)		-28.1	%
Mississippi (2)		49,349			37,771			56,590			11,578			30.7	%		(7,241	)		-12.8	%
Tennessee (3)		5,185			6,213			5,849			(1,028	)		-16.5	%		(664	)		-11.4	%
Texas		1,565			941			1,515			624			66.3	%		50			3.3	%
Total nonaccrual loans		61,307			49,234			70,694			12,073			24.5	%		(9,387	)		-13.3	%
Other real estate
Alabama		13,953			15,989			19,137			(2,036	)		-12.7	%		(5,184	)		-27.1	%
Florida		21,577			22,582			27,907			(1,005	)		-4.5	%		(6,330	)		-22.7	%
Mississippi (2)		14,974			15,646			14,511			(672	)		-4.3	%		463			3.2	%
Tennessee (3)		4,706			6,183			8,699			(1,477	)		-23.9	%		(3,993	)		-45.9	%
Texas		758			1,651			1,552			(893	)		-54.1	%		(794	)		-51.2	%
Total other real estate		55,968			62,051			71,806			(6,083	)		-9.8	%		(15,838	)		-22.1	%
Total nonperforming assets	$	117,275		$	111,285		$	142,500		$	5,990			5.4	%	$	(25,225	)		-17.7	%

LOANS PAST DUE OVER 90 DAYS (4)
LHFI	$	1,307		$	1,832		$	611		$	(525	)		-28.7	%	$	696		n/m

LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase)	$	31,147		$	28,345		$	24,110		$	2,802			9.9	%	$	7,037			29.2	%

	Quarter Ended									Linked Quarter						Year over Year
ALLOWANCE FOR LOAN LOSSES (4)	3/31/2017			12/31/2016			3/31/2016			$ Change			% Change			$ Change			% Change
Beginning Balance	$	71,265		$	70,871		$	67,619		$	394			0.6	%	$	3,646			5.4	%
Provision for loan losses		2,762			1,834			2,243			928			50.6	%		519			23.1	%
Charge-offs		(4,202	)		(4,037	)		(3,363	)		(165	)		4.1	%		(839	)		24.9	%
Recoveries		2,620			2,597			3,169			23			0.9	%		(549	)		-17.3	%
Net charge-offs		(1,582	)		(1,440	)		(194	)		(142	)		9.9	%		(1,388	)	n/m
Ending Balance	$	72,445		$	71,265		$	69,668		$	1,180			1.7	%	$	2,777			4.0	%

PROVISION FOR LOAN LOSSES (4)
Alabama	$	1,189		$	763		$	540		$	426			55.8	%	$	649		n/m
Florida		3			(655	)		(818	)		658		n/m				821		n/m
Mississippi (2)		1,826			1,873			1,848			(47	)		-2.5	%		(22	)		-1.2	%
Tennessee (3)		208			(118	)		138			326		n/m				70			50.7	%
Texas		(464	)		(29	)		535			(435	)	n/m				(999	)	n/m
Total provision for loan losses	$	2,762		$	1,834		$	2,243		$	928			50.6	%	$	519			23.1	%

NET CHARGE-OFFS (4)
Alabama	$	66		$	368		$	63		$	(302	)		-82.1	%	$	3			4.8	%
Florida		(155	)		(502	)		(674	)		347			-69.1	%		519			-77.0	%
Mississippi (2)		1,759			1,591			(74	)		168			10.6	%		1,833		n/m
Tennessee (3)		83			(8	)		8			91		n/m				75		n/m
Texas		(171	)		(9	)		871			(162	)	n/m				(1,042	)	n/m
Total net charge-offs	$	1,582		$	1,440		$	194		$	142			9.9	%	$	1,388		n/m

(1) - Excludes acquired loans and covered other real estate
(2) - Mississippi includes Central and Southern Mississippi Regions
(3) - Tennessee includes Memphis, Tennessee and Northern Mississippi Regions
(4) - Excludes acquired loans

n/m - percentage changes greater than +/- 100% are considered not meaningful

	Quarter Ended
AVERAGE BALANCES	3/31/2017			12/31/2016			9/30/2016			6/30/2016			3/31/2016
Securities AFS-taxable	$	2,252,162		$	2,271,503		$	2,249,109		$	2,214,040		$	2,211,479
Securities AFS-nontaxable		88,522			91,495			95,233			99,296			105,844
Securities HTM-taxable		1,124,692			1,101,382			1,115,053			1,122,463			1,142,434
Securities HTM-nontaxable		33,009			33,675			34,179			34,785			35,841
Total securities		3,498,385			3,498,055			3,493,574			3,470,584			3,495,598
Loans (including loans held for sale)		8,074,449			7,855,444			7,658,089			7,505,409			7,346,333
Acquired loans		250,482			282,197			317,273			349,740			378,435
Fed funds sold and rev repos		397			1,418			1,352			1,263			382
Other earning assets		79,515			80,608			68,706			64,000			66,702
Total earning assets		11,903,228			11,717,722			11,538,994			11,390,996			11,287,450
Allowance for loan losses		(83,394	)		(82,604	)		(82,301	)		(83,614	)		(81,138	)
Cash and due from banks		310,542			314,420			299,670			271,135			281,912
Other assets		1,235,469			1,238,029			1,243,854			1,240,846			1,253,282
Total assets	$	13,365,845		$	13,187,567		$	13,000,217		$	12,819,363		$	12,741,506

Interest-bearing demand deposits	$	1,981,982		$	1,920,273		$	1,848,084		$	1,830,107		$	1,866,043
Savings deposits		3,319,572			3,049,733			3,101,161			3,221,850			3,188,916
Time deposits		1,650,251			1,638,853			1,667,345			1,678,564			1,677,576
Total interest-bearing deposits		6,951,805			6,608,859			6,616,590			6,730,521			6,732,535
Fed funds purchased and repos		498,963			494,193			481,071			488,512			517,180
Short-term borrowings		887,848			435,576			311,473			319,288			413,616
Long-term FHLB advances		251,033			685,844			751,095			597,269			501,144
Subordinated notes		—			40,757			49,988			49,980			49,972
Junior subordinated debt securities		61,856			61,856			61,856			61,856			61,856
Total interest-bearing liabilities		8,651,505			8,327,085			8,272,073			8,247,426			8,276,303
Noninterest-bearing deposits		3,008,176			3,160,959			3,060,331			2,927,469			2,836,283
Other liabilities		173,066			166,379			136,971			131,627			134,236
Total liabilities		11,832,747			11,654,423			11,469,375			11,306,522			11,246,822
Shareholders' equity		1,533,098			1,533,144			1,530,842			1,512,841			1,494,684
Total liabilities and equity	$	13,365,845		$	13,187,567		$	13,000,217		$	12,819,363		$	12,741,506

PERIOD END BALANCES	3/31/2017			12/31/2016			9/30/2016			6/30/2016			3/31/2016
Cash and due from banks	$	379,590		$	327,706		$	383,945		$	322,049		$	228,498
Fed funds sold and rev repos		500			500			500			3,198			—
Securities available for sale		2,365,554			2,356,682			2,410,947			2,388,306			2,368,120
Securities held to maturity		1,156,067			1,158,643			1,143,234			1,173,204			1,168,203
Loans held for sale (LHFS)		174,090			175,927			242,097			213,546			191,028
Loans held for investment (LHFI)		8,004,657			7,851,213			7,499,204			7,405,181			7,268,022
Allowance for loan losses		(72,445	)		(71,265	)		(70,871	)		(71,796	)		(69,668	)
Net LHFI		7,932,212			7,779,948			7,428,333			7,333,385			7,198,354
Acquired loans		218,242			272,247			295,737			339,035			364,755
Allowance for loan losses, acquired loans		(10,006	)		(11,397	)		(11,380	)		(12,480	)		(13,535	)
Net acquired loans		208,236			260,850			284,357			326,555			351,220
Net LHFI and acquired loans		8,140,448			8,040,798			7,712,690			7,659,940			7,549,574
Premises and equipment, net		183,311			184,987			190,930			192,732			194,453
Mortgage servicing rights		82,758			80,239			65,514			62,814			68,208
Goodwill		366,156			366,156			366,156			366,156			366,156
Identifiable intangible assets		19,117			20,680			22,366			24,058			25,751
Other real estate		55,968			62,051			64,993			69,890			72,302
Other assets		566,802			577,964			558,166			554,456			542,903
Total assets	$	13,490,361		$	13,352,333		$	13,161,538		$	13,030,349		$	12,775,196

Deposits:
Noninterest-bearing	$	3,209,727		$	2,973,238		$	3,111,603		$	2,921,016		$	2,874,306
Interest-bearing		6,894,745			7,082,774			6,574,098			6,610,508			6,759,337
Total deposits		10,104,472			10,056,012			9,685,701			9,531,524			9,633,643
Fed funds purchased and repos		524,335			539,817			514,918			606,336			466,436
Short-term borrowings		864,690			769,778			412,792			360,434			411,385
Long-term FHLB advances		250,994			251,049			751,075			751,106			501,124
Subordinated notes		—			—			49,993			49,985			49,977
Junior subordinated debt securities		61,856			61,856			61,856			61,856			61,856
Other liabilities		146,053			153,613			150,442			145,641			142,519
Total liabilities		11,952,400			11,832,125			11,626,777			11,506,882			11,266,940
Common stock		14,112			14,091			14,090			14,090			14,093
Capital surplus		365,951			366,563			365,553			364,516			363,979
Retained earnings		1,200,903			1,185,352			1,172,193			1,157,025			1,151,757
Accum other comprehensive loss, net of tax		(43,005	)		(45,798	)		(17,075	)		(12,164	)		(21,573	)
Total shareholders' equity		1,537,961			1,520,208			1,534,761			1,523,467			1,508,256
Total liabilities and equity	$	13,490,361		$	13,352,333		$	13,161,538		$	13,030,349		$	12,775,196

	Quarter Ended
INCOME STATEMENTS	3/31/2017			12/31/2016		9/30/2016			6/30/2016		3/31/2016
Interest and fees on LHFS & LHFI-FTE	$	83,790		$	81,346	$	80,649		$	77,777	$	76,235
Interest and fees on acquired loans		5,189			8,290		6,781			8,051		7,022
Interest on securities-taxable		19,197			18,775		19,351			19,402		20,086
Interest on securities-tax exempt-FTE		1,300			1,340		1,388			1,429		1,497
Interest on fed funds sold and rev repos		1			4		5			4		1
Other interest income		267			335		223			200		230
Total interest income-FTE		109,744			110,090		108,397			106,863		105,071
Interest on deposits		3,945			3,380		3,208			3,122		3,038
Interest on fed funds pch and repos		698			471		411			404		431
Other interest expense		2,673			2,662		2,603			2,428		2,389
Total interest expense		7,316			6,513		6,222			5,954		5,858
Net interest income-FTE		102,428			103,577		102,175			100,909		99,213
Provision for loan losses, LHFI		2,762			1,834		4,284			2,596		2,243
Provision for loan losses, acquired loans		(1,605	)		1,150		691			607		1,309
Net interest income after provision-FTE		101,271			100,593		97,200			97,706		95,661
Service charges on deposit accounts		10,832			11,444		11,677			11,051		11,081
Bank card and other fees		6,500			6,796		6,756			7,436		6,918
Mortgage banking, net		10,185			5,428		7,364			6,721		8,699
Insurance commissions		9,212			8,459		10,074			9,638		8,593
Wealth management		7,413			7,505		7,571			8,009		7,407
Other, net		1,891			2,092		1,274			1,372		888
Nonint inc-excl sec gains (losses), net		46,033			41,724		44,716			44,227		43,586
Security gains (losses), net		—			—		—			—		(310	)
Total noninterest income		46,033			41,724		44,716			44,227		43,276
Salaries and employee benefits		57,302			58,168		57,250			67,018		57,201
Services and fees		15,332			14,751		14,947			14,522		14,475
Net occupancy-premises		6,238			6,426		6,440			5,928		6,188
Equipment expense		5,998			6,172		6,063			5,896		6,094
Other real estate expense		1,759			525		(1,313	)		1,193		181
FDIC assessment expense		2,640			2,562		2,911			2,959		2,811
Other expense		12,788			11,663		11,610			12,663		11,994
Total noninterest expense		102,057			100,267		97,908			110,179		98,944
Income before income taxes and tax eq adj		45,247			42,050		44,008			31,754		39,993
Tax equivalent adjustment		4,838			4,725		4,611			4,532		4,473
Income before income taxes		40,409			37,325		39,397			27,222		35,520
Income taxes		9,161			8,402		8,415			5,719		8,517
Net income	$	31,248		$	28,923	$	30,982		$	21,503	$	27,003

Per share data
Earnings per share - basic	$	0.46		$	0.43	$	0.46		$	0.32	$	0.40

Earnings per share - diluted	$	0.46		$	0.43	$	0.46		$	0.32	$	0.40

Dividends per share	$	0.23		$	0.23	$	0.23		$	0.23	$	0.23

Weighted average shares outstanding
Basic		67,687,365			67,627,496		67,625,085			67,619,571		67,609,662

Diluted		67,845,785			67,817,770		67,793,203			67,770,174		67,746,592

Period end shares outstanding		67,729,434			67,628,618		67,626,939			67,623,601		67,639,832

	Quarter Ended
NONPERFORMING ASSETS (1)	3/31/2017			12/31/2016			9/30/2016			6/30/2016			3/31/2016
Nonaccrual loans
Alabama	$	1,649		$	665		$	1,403		$	1,379		$	1,788
Florida		3,559			3,644			3,719			1,806			4,952
Mississippi (2)		49,349			37,771			41,968			54,543			56,590
Tennessee (3)		5,185			6,213			6,620			5,345			5,849
Texas		1,565			941			700			2,055			1,515
Total nonaccrual loans		61,307			49,234			54,410			65,128			70,694
Other real estate
Alabama		13,953			15,989			15,574			18,031			19,137
Florida		21,577			22,582			25,147			28,052			27,907
Mississippi (2)		14,974			15,646			16,659			14,435			14,511
Tennessee (3)		4,706			6,183			6,061			7,432			8,699
Texas		758			1,651			1,552			1,552			1,552
Total other real estate		55,968			62,051			64,993			69,502			71,806
Total nonperforming assets	$	117,275		$	111,285		$	119,403		$	134,630		$	142,500

LOANS PAST DUE OVER 90 DAYS (4)
LHFI	$	1,307		$	1,832		$	953		$	3,382		$	611

LHFS-Guaranteed GNMA serviced loans
(no obligation to repurchase)	$	31,147		$	28,345		$	25,570		$	23,473		$	24,110


	Quarter Ended
ALLOWANCE FOR LOAN LOSSES (4)	3/31/2017			12/31/2016			9/30/2016			6/30/2016			3/31/2016
Beginning Balance	$	71,265		$	70,871		$	71,796		$	69,668		$	67,619
Provision for loan losses		2,762			1,834			4,284			2,596			2,243
Charge-offs		(4,202	)		(4,037	)		(8,279	)		(3,251	)		(3,363	)
Recoveries		2,620			2,597			3,070			2,783			3,169
Net charge-offs		(1,582	)		(1,440	)		(5,209	)		(468	)		(194	)
Ending Balance	$	72,445		$	71,265		$	70,871		$	71,796		$	69,668

PROVISION FOR LOAN LOSSES (4)
Alabama	$	1,189		$	763		$	132		$	1,189		$	540
Florida		3			(655	)		31			(364	)		(818	)
Mississippi (2)		1,826			1,873			703			(833	)		1,848
Tennessee (3)		208			(118	)		151			726			138
Texas		(464	)		(29	)		3,267			1,878			535
Total provision for loan losses	$	2,762		$	1,834		$	4,284		$	2,596		$	2,243

NET CHARGE-OFFS (4)
Alabama	$	66		$	368		$	38		$	436		$	63
Florida		(155	)		(502	)		(169	)		(595	)		(674	)
Mississippi (2)		1,759			1,591			2,484			(237	)		(74	)
Tennessee (3)		83			(8	)		74			252			8
Texas		(171	)		(9	)		2,782			612			871
Total net charge-offs	$	1,582		$	1,440		$	5,209		$	468		$	194

(1) - Excludes acquired loans and covered other real estate
(2) - Mississippi includes Central and Southern Mississippi Regions
(3) - Tennessee includes Memphis, Tennessee and Northern Mississippi Regions
(4) - Excludes acquired loans

	Quarter Ended
FINANCIAL RATIOS AND OTHER DATA	3/31/2017			12/31/2016			9/30/2016			6/30/2016			3/31/2016
Return on equity		8.27	%		7.51	%		8.05	%		5.72	%		7.27	%
Return on average tangible equity		11.39	%		10.41	%		11.16	%		8.08	%		10.26	%
Return on assets		0.95	%		0.87	%		0.95	%		0.67	%		0.85	%
Interest margin - Yield - FTE		3.74	%		3.74	%		3.74	%		3.77	%		3.74	%
Interest margin - Cost		0.25	%		0.22	%		0.21	%		0.21	%		0.21	%
Net interest margin - FTE		3.49	%		3.52	%		3.52	%		3.56	%		3.54	%
Efficiency ratio (1)		66.67	%		66.08	%		63.81	%		67.20	%		66.87	%
Full-time equivalent employees		2,799			2,788			2,787			2,818			2,946

CREDIT QUALITY RATIOS (2)
Net charge-offs/average loans		0.08	%		0.07	%		0.27	%		0.03	%		0.01	%
Provision for loan losses/average loans		0.14	%		0.09	%		0.22	%		0.14	%		0.12	%
Nonperforming loans/total loans (incl LHFS)		0.75	%		0.61	%		0.70	%		0.85	%		0.95	%
Nonperforming assets/total loans (incl LHFS)		1.43	%		1.39	%		1.54	%		1.77	%		1.91	%
Nonperforming assets/total loans (incl LHFS) +ORE		1.42	%		1.38	%		1.53	%		1.75	%		1.89	%
ALL/total loans (excl LHFS)		0.91	%		0.91	%		0.95	%		0.97	%		0.96	%
ALL-commercial/total commercial loans		0.97	%		0.97	%		1.02	%		1.05	%		1.06	%
ALL-consumer/total consumer and home mortgage loans		0.67	%		0.68	%		0.68	%		0.70	%		0.65	%
ALL/nonperforming loans		118.17	%		144.75	%		130.25	%		110.24	%		98.55	%
ALL/nonperforming loans (excl specifically reviewed impaired loans)		263.73	%		267.40	%		256.56	%		231.13	%		203.24	%

CAPITAL RATIOS
Total equity/total assets		11.40	%		11.39	%		11.66	%		11.69	%		11.81	%
Tangible equity/tangible assets		8.80	%		8.74	%		8.97	%		8.97	%		9.01	%
Tangible equity/risk-weighted assets		11.49	%		11.39	%		11.85	%		11.85	%		11.84	%
Tier 1 leverage ratio		9.86	%		9.90	%		9.92	%		9.93	%		9.93	%
Common equity tier 1 capital ratio		12.19	%		12.16	%		12.35	%		12.32	%		12.41	%
Tier 1 risk-based capital ratio		12.79	%		12.76	%		12.97	%		12.94	%		13.04	%
Total risk-based capital ratio		13.61	%		13.59	%		13.82	%		13.82	%		13.92	%

STOCK PERFORMANCE
Market value-Close	$	31.79		$	35.65		$	27.56		$	24.85		$	23.03
Book value	$	22.71		$	22.48		$	22.69		$	22.53		$	22.30
Tangible book value	$	17.02		$	16.76		$	16.95		$	16.76		$	16.50

(1) - The efficiency ratio is noninterest expense to total net interest income (FTE) and noninterest income, excluding security gains (losses), amortization
of partnership tax credits, amortization of purchased intangibles, and nonroutine income and expense items.
(2) - Excludes acquired loans and covered other real estate

On April 7, 2017, Trustmark Corporation (Trustmark) completed its merger with RB Bancorporation. RB Bancorporation, with assets of $201.2 million as of March 31, 2017, is the holding company for Reliance Bank, which had seven offices serving the Huntsville, Alabama MSA. Reliance Bank was merged into Trustmark National Bank simultaneously with the merger of Trustmark and RB Bancorporation. Under the terms of the Merger Agreement dated November 14, 2016, Trustmark paid $22.00 in cash for each share of RB Bancorporation common stock outstanding, which represents total consideration for common shareholders of approximately $23.7 million.

The following table is a summary of the estimated fair value of securities available for sale and the amortized cost of securities held to maturity ($ in thousands):

	3/31/2017		12/31/2016		9/30/2016		6/30/2016		3/31/2016
SECURITIES AVAILABLE FOR SALE
U.S. Government agency obligations
Issued by U.S. Government agencies	$	53,247	$	55,763	$	58,234	$	61,359	$	63,814
Issued by U.S. Government sponsored agencies		274		276		283		286		286
Obligations of states and political subdivisions		109,895		115,373		124,641		129,285		135,655
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA		42,667		42,786		36,788		29,282		25,081
Issued by FNMA and FHLMC		733,214		631,084		561,989		428,542		330,558
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		1,202,719		1,267,951		1,374,399		1,474,357		1,540,541
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		223,538		243,449		254,613		265,195		272,185
Total securities available for sale	$	2,365,554	$	2,356,682	$	2,410,947	$	2,388,306	$	2,368,120

SECURITIES HELD TO MATURITY
U.S. Government agency obligations
Issued by U.S. Government sponsored agencies	$	3,658	$	3,647	$	3,636	$	31,142	$	63,085
Obligations of states and political subdivisions		46,273		46,303		52,937		53,473		54,278
Mortgage-backed securities
Residential mortgage pass-through securities
Guaranteed by GNMA		14,977		15,478		16,183		16,415		16,590
Issued by FNMA and FHLMC		118,733		81,299		39,989		42,267		9,871
Other residential mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		771,296		803,474		831,662		824,175		818,201
Commercial mortgage-backed securities
Issued or guaranteed by FNMA, FHLMC, or GNMA		201,130		208,442		198,827		205,732		206,178
Total securities held to maturity	$	1,156,067	$	1,158,643	$	1,143,234	$	1,173,204	$	1,168,203

During 2013, Trustmark reclassified approximately $1.099 billion of securities available for sale to securities held to maturity. The securities were transferred at fair value, which became the cost basis for the securities held to maturity. At the date of transfer, the net unrealized holding loss on the available for sale securities totaled approximately $46.6 million ($28.8 million, net of tax). The net unrealized holding loss is amortized over the remaining life of the securities as a yield adjustment in a manner consistent with the amortization or accretion of the original purchase premium or discount on the associated security. There were no gains or losses recognized as a result of the transfer. At March 31, 2017, the net unamortized, unrealized loss on the transferred securities included in accumulated other comprehensive loss in the accompanying balance sheet totaled approximately $23.0 million ($14.2 million, net of tax).

Management continues to focus on asset quality as one of the strategic goals of the securities portfolio, which is evidenced by the investment of approximately 96% of the portfolio in GSE-backed obligations and other Aaa rated securities as determined by Moody’s. None of the securities owned by Trustmark are collateralized by assets which are considered sub-prime. Furthermore, outside of stock ownership in the Federal Home Loan Bank of Dallas, Federal Home Loan Bank of Atlanta and Federal Reserve Bank, Trustmark does not hold any other equity investment in a GSE.

(1) Trustmark revised the presentation of acquired loans by eliminating the segmentation of acquired noncovered loans and acquired covered loans due to the significantly reduced size of the acquired covered loan portfolio.

During the first quarter of 2017, Trustmark transferred the remaining balance of the acquired loans not accounted for under FASB ASC Topic 310-30, “Loans and Debt Securities Acquired with Deteriorated Credit Quality” to LHFI due to the discount on these loans being fully amortized. The balance of these transferred loans totaled $36.7 million.

	March 31, 2017
LHFI - COMPOSITION BY REGION (1)	Total		Alabama		Florida		Mississippi (Central and Southern Regions)		Tennessee (Memphis, TN and Northern MS Regions)		Texas
Loans secured by real estate:
Construction, land development and other land loans	$	859,927	$	226,553	$	58,778	$	307,859	$	36,848	$	229,889
Secured by 1-4 family residential properties		1,656,837		91,536		51,476		1,397,976		98,906		16,943
Secured by nonfarm, nonresidential properties		2,064,352		310,000		191,923		909,040		167,572		485,817
Other real estate secured		399,636		34,944		3,324		194,715		38,153		128,500
Commercial and industrial loans		1,540,783		128,705		22,970		793,558		333,052		262,498
Consumer loans		166,314		21,676		3,684		122,046		16,776		2,132
State and other political subdivision loans		910,493		79,393		29,450		548,224		31,595		221,831
Other loans		406,315		55,457		18,214		263,337		32,627		36,680
Loans	$	8,004,657	$	948,264	$	379,819	$	4,536,755	$	755,529	$	1,384,290

CONSTRUCTION, LAND DEVELOPMENT AND OTHER LAND LOANS BY REGION (1)
Lots	$	61,643	$	12,769	$	17,776	$	24,734	$	2,263	$	4,101
Development		52,501		7,682		6,033		19,110		612		19,064
Unimproved land		108,177		16,203		15,721		41,533		15,947		18,773
1-4 family construction		185,213		47,561		10,675		86,919		2,277		37,781
Other construction		452,393		142,338		8,573		135,563		15,749		150,170
Construction, land development and other land loans	$	859,927	$	226,553	$	58,778	$	307,859	$	36,848	$	229,889

LOANS SECURED BY NONFARM, NONRESIDENTIAL PROPERTIES BY REGION (1)
Income producing:
Retail	$	276,475	$	82,560	$	35,717	$	94,736	$	18,056	$	45,406
Office		218,611		31,346		30,096		74,722		6,853		75,594
Nursing homes/assisted living		128,578		—		—		121,935		6,643		—
Hotel/motel		232,458		53,118		29,329		64,244		41,322		44,445
Mini-storage		152,285		12,390		7,346		57,869		14,163		60,517
Industrial		121,092		10,640		10,073		21,802		5,066		73,511
Health care		31,347		2,126		815		27,373		—		1,033
Convenience stores		17,179		258		—		9,830		962		6,129
Other		95,059		15,486		24,534		24,493		2,229		28,317
Total income producing loans		1,273,084		207,924		137,910		497,004		95,294		334,952

Owner-occupied:
Office		140,556		18,537		23,312		68,778		7,226		22,703
Churches		87,616		12,751		2,074		44,235		21,746		6,810
Industrial warehouses		128,630		6,325		3,541		64,960		13,242		40,562
Health care		117,865		22,541		6,688		68,678		4,530		15,428
Convenience stores		93,577		9,599		6,983		52,864		1,135		22,996
Retail		44,329		4,428		7,012		21,421		5,826		5,642
Restaurants		33,653		3,593		885		23,768		3,424		1,983
Auto dealerships		18,849		8,817		39		8,902		1,091		—
Other		126,193		15,485		3,479		58,430		14,058		34,741
Total owner-occupied loans		791,268		102,076		54,013		412,036		72,278		150,865
Loans secured by nonfarm, nonresidential properties	$	2,064,352	$	310,000	$	191,923	$	909,040	$	167,572	$	485,817

The following table illustrates the yields on earning assets by category as well as the rates paid on interest-bearing liabilities on a tax equivalent basis:

	Quarter Ended
	3/31/2017			12/31/2016			9/30/2016			6/30/2016			3/31/2016
Securities – taxable		2.31	%		2.21	%		2.29	%		2.34	%		2.41	%
Securities – nontaxable		4.34	%		4.26	%		4.27	%		4.29	%		4.25	%
Securities – total		2.38	%		2.29	%		2.36	%		2.41	%		2.48	%
Loans - LHFI & LHFS		4.21	%		4.12	%		4.19	%		4.17	%		4.17	%
Acquired loans		8.40	%		11.69	%		8.50	%		9.26	%		7.46	%
Loans - total		4.33	%		4.38	%		4.36	%		4.39	%		4.33	%
FF sold & rev repo		1.02	%		1.12	%		1.47	%		1.27	%		1.05	%
Other earning assets		1.36	%		1.65	%		1.29	%		1.26	%		1.39	%
Total earning assets		3.74	%		3.74	%		3.74	%		3.77	%		3.74	%

Interest-bearing deposits		0.23	%		0.20	%		0.19	%		0.19	%		0.18	%
FF pch & repo		0.57	%		0.38	%		0.34	%		0.33	%		0.34	%
Other borrowings		0.90	%		0.87	%		0.88	%		0.95	%		0.94	%
Total interest-bearing liabilities		0.34	%		0.31	%		0.30	%		0.29	%		0.28	%

Net interest margin		3.49	%		3.52	%		3.52	%		3.56	%		3.54	%
Net interest margin excluding acquired loans		3.38	%		3.31	%		3.38	%		3.38	%		3.40	%

Reflected in the table above are yields on earning assets and liabilities, along with the net interest margin which equals reported net interest income-FTE, annualized, as a percent of average earning assets. In addition, the table includes net interest margin excluding acquired loans, which equals reported net interest income-FTE excluding interest income on acquired loans, annualized, as a percent of average earning assets excluding average acquired loans.

During the first quarter of 2017, the yield on acquired loans totaled 8.40% and included $1.2 million in recoveries from the settlement of debt, which represented approximately 2.02% of the annualized total acquired loan yield. Excluding acquired loans, the net interest margin totaled 3.38% for the first quarter of 2017, an increase of 7 basis points when compared to the fourth quarter of 2016. This increase was primarily due to growth in the yields on the securities portfolio and the loans held for investment and held for sale portfolio.

Trustmark utilizes a portfolio of exchange-traded derivative instruments, such as Treasury note futures contracts and option contracts, to achieve a fair value return that offsets the changes in fair value of mortgage servicing rights (MSR) attributable to interest rates. These transactions are considered freestanding derivatives that do not otherwise qualify for hedge accounting under generally accepted accounting principles (GAAP). Changes in the fair value of these exchange-traded derivative instruments, including administrative costs, are recorded in noninterest income in mortgage banking, net and are offset by the changes in the fair value of the MSR. The MSR fair value represents the present value of future cash flows, which among other things includes decay and the effect of changes in interest rates. Ineffectiveness of hedging the MSR fair value is measured by comparing the change in value of hedge instruments to the change in the fair value of the MSR asset attributable to changes in interest rates and other market driven changes in valuation inputs and assumptions. The impact of this strategy resulted in a net positive ineffectiveness of $2.8 million and $413 thousand for the quarters ended March 31, 2017 and 2016, respectively.

The following table illustrates the components of mortgage banking revenues included in noninterest income in the accompanying income statements:

During the second quarter of 2016, Trustmark announced a voluntary early retirement program (ERP) for associates age 60 and above with five or more years of service. The cost of this program is reflected in a one-time, pre-tax charge of approximately $9.3 million (salaries and employee benefits expense of $9.1 million and other miscellaneous expense of $230 thousand), or $0.085 per basic share net of tax, in Trustmark’s second quarter 2016 earnings. As a result of the ERP, during the third and fourth quarters of 2016, Trustmark incurred additional expense of $236 thousand and $268 thousand, respectively, which primarily resulted from additional settlements from pension lump sum elections.

Trustmark maintains a noncontributory tax-qualified defined benefit pension plan (Trustmark Capital Accumulation Plan, the “Plan”), in which substantially all associates who began employment prior to 2007 participate. The Plan provides retirement benefits that are based on the length of credited service and final average compensation, as defined in the Plan, and vest upon three years of service. Benefit accruals under the plan have been frozen since 2009, with the exception of certain associates covered through plans obtained in acquisitions that were subsequently merged into the Plan. On July 26, 2016, the Board of Directors of Trustmark authorized the termination of the Plan, effective as of December 31, 2016. To satisfy commitments made by Trustmark to associates (collectively, the “Continuing Associates”) covered through acquired plans that were merged into the Plan, the Board also approved the spin-off of the portion of the Plan associated with the accrued benefits of the Continuing Associates into a new plan titled the Trustmark Corporation Pension Plan for Certain Employees of Acquired Financial Institutions (the “Spin-Off Plan”), effective as of December 31, 2016, immediately prior to the termination of the Plan. In order to terminate the Plan, in accordance with Internal Revenue Service and Pension Benefit Guaranty Corporation requirements, Trustmark is required to fully fund the Plan on a termination basis and will contribute the additional assets necessary to do so. The final distributions will be made from current plan assets and a one-time pension settlement expense of approximately $17.5 million will be recognized when paid by Trustmark during the second quarter of 2017. After the distribution of Plan assets during the second quarter of 2017, Trustmark estimates that the annual pension expense will be reduced by $3.0 million to $4.0 million.

Other noninterest income consisted of the following for the periods presented ($ in thousands):

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 and 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.

Other noninterest expense consisted of the following for the periods presented ($ in thousands):

In addition to capital ratios defined by U.S. generally accepted accounting principles (GAAP) and banking regulators, Trustmark utilizes various tangible common equity measures when evaluating capital utilization and adequacy. Tangible common equity, as defined by Trustmark, represents common equity less goodwill and identifiable intangible assets.

Trustmark believes these measures are important because they reflect the level of capital available to withstand unexpected market conditions. Additionally, presentation of these measures allows readers to compare certain aspects of Trustmark’s capitalization to other organizations. These ratios differ from capital measures defined by banking regulators principally in that the numerator excludes shareholders’ equity associated with preferred securities, the nature and extent of which varies across organizations. In Management’s experience, many stock analysts use tangible common equity measures in conjunction with more traditional bank capital ratios to compare capital adequacy of banking organizations with significant amounts of goodwill or other tangible assets, typically stemming from the use of the purchase accounting method in accounting for mergers and acquisitions.

These calculations are intended to complement the capital ratios defined by GAAP and banking regulators. Because GAAP does not include these capital ratio measures, Trustmark believes there are no comparable GAAP financial measures to these tangible common equity ratios. Despite the importance of these measures to Trustmark, there are no standardized definitions for them and, as a result, Trustmark’s calculations may not be comparable with other organizations. Also there may be limits in the usefulness of these measures to investors. As a result, Trustmark encourages readers to consider its consolidated financial statements in their entirety and not to rely on any single financial measure. The following table reconciles Trustmark’s calculation of these measures to amounts reported under GAAP.

		Quarter Ended
		3/31/2017			12/31/2016			9/30/2016			6/30/2016			3/31/2016
TANGIBLE EQUITY
AVERAGE BALANCES
Total shareholders' equity		$	1,533,098		$	1,533,144		$	1,530,842		$	1,512,841		$	1,494,684
Less: Goodwill			(366,156	)		(366,156	)		(366,156	)		(366,156	)		(366,156	)
Identifiable intangible assets			(19,950	)		(21,585	)		(23,311	)		(24,961	)		(26,709	)
Total average tangible equity		$	1,146,992		$	1,145,403		$	1,141,375		$	1,121,724		$	1,101,819

PERIOD END BALANCES
Total shareholders' equity		$	1,537,961		$	1,520,208		$	1,534,761		$	1,523,467		$	1,508,256
Less: Goodwill			(366,156	)		(366,156	)		(366,156	)		(366,156	)		(366,156	)
Identifiable intangible assets			(19,117	)		(20,680	)		(22,366	)		(24,058	)		(25,751	)
Total tangible equity	(a)	$	1,152,688		$	1,133,372		$	1,146,239		$	1,133,253		$	1,116,349

TANGIBLE ASSETS
Total assets		$	13,490,361		$	13,352,333		$	13,161,538		$	13,030,349		$	12,775,196
Less: Goodwill			(366,156	)		(366,156	)		(366,156	)		(366,156	)		(366,156	)
Identifiable intangible assets			(19,117	)		(20,680	)		(22,366	)		(24,058	)		(25,751	)
Total tangible assets	(b)	$	13,105,088		$	12,965,497		$	12,773,016		$	12,640,135		$	12,383,289
Risk-weighted assets	(c)	$	10,031,410		$	9,952,123		$	9,670,302		$	9,559,816		$	9,431,021

NET INCOME ADJUSTED FOR INTANGIBLE AMORTIZATION
Net income		$	31,248		$	28,923		$	30,982		$	21,503		$	27,003
Plus: Intangible amortization net of tax			966			1,041			1,045			1,045			1,109
Net income adjusted for intangible amortization		$	32,214		$	29,964		$	32,027		$	22,548		$	28,112
Period end common shares outstanding	(d)		67,729,434			67,628,618			67,626,939			67,623,601			67,639,832

TANGIBLE COMMON EQUITY MEASUREMENTS
Return on average tangible equity (1)			11.39	%		10.41	%		11.16	%		8.08	%		10.26	%
Tangible equity/tangible assets	(a)/(b)		8.80	%		8.74	%		8.97	%		8.97	%		9.01	%
Tangible equity/risk-weighted assets	(a)/(c)		11.49	%		11.39	%		11.85	%		11.85	%		11.84	%
Tangible book value	(a)/(d)*1,000	$	17.02		$	16.76		$	16.95		$	16.76		$	16.50

COMMON EQUITY TIER 1 CAPITAL (CET1)
Total shareholders' equity		$	1,537,961		$	1,520,208		$	1,534,761		$	1,523,467		$	1,508,256
AOCI-related adjustments			43,005			45,798			17,075			12,164			21,573
CET1 adjustments and deductions:
Goodwill net of associated deferred tax liabilities (DTLs)			(347,085	)		(347,442	)		(347,800	)		(348,158	)		(348,515	)
Other adjustments and deductions for CET1 (2)			(10,803	)		(8,637	)		(9,307	)		(10,042	)		(10,861	)
CET1 capital	(e)		1,223,078			1,209,927			1,194,729			1,177,431			1,170,453
Additional tier 1 capital instruments plus related surplus			60,000			60,000			60,000			60,000			60,000
Less: additional tier 1 capital deductions			(159	)		(267	)		(276	)		(328	)		(434	)
Additional tier 1 capital			59,841			59,733			59,724			59,672			59,566
Tier 1 capital		$	1,282,919		$	1,269,660		$	1,254,453		$	1,237,103		$	1,230,019

Common equity tier 1 capital ratio	(e)/(c)		12.19	%		12.16	%		12.35	%		12.32	%		12.41	%

(1) Calculation = ((net income adjusted for intangible amortization/number of days in period)*number of days in year)/total average tangible equity

(2) Includes other intangible assets, net of DTLs, disallowed deferred tax assets (DTAS), threshold deductions and transition adjustments, as applicable.


Trustmark Investor Contacts:	Trustmark Media Contact:
Louis E. Greer	Melanie A. Morgan
Treasurer and	Senior Vice President
Principal Financial Officer	601-208-2979
601-208-2310


		TRUSTMARK CORPORATION AND SUBSIDIARIES
		CONSOLIDATED FINANCIAL INFORMATION
		March 31, 2017
		($ in thousands)
		(unaudited)


		TRUSTMARK CORPORATION AND SUBSIDIARIES
		CONSOLIDATED FINANCIAL INFORMATION
		March 31, 2017
		($ in thousands)
		(unaudited)


		TRUSTMARK CORPORATION AND SUBSIDIARIES
		CONSOLIDATED FINANCIAL INFORMATION
		March 31, 2017
		($ in thousands except per share data)
		(unaudited)


		TRUSTMARK CORPORATION AND SUBSIDIARIES
		CONSOLIDATED FINANCIAL INFORMATION
		March 31, 2017
		($ in thousands)
		(unaudited)

		TRUSTMARK CORPORATION AND SUBSIDIARIES
		NOTES TO CONSOLIDATED FINANCIALS
		March 31, 2017
		($ in thousands)
		(unaudited)

LHFI BY TYPE (excluding acquired loans)	3/31/2017			12/31/2016			9/30/2016			6/30/2016			3/31/2016
Loans secured by real estate:
Construction, land development and other land loans	$	859,927		$	831,437		$	766,685		$	718,438		$	697,500
Secured by 1-4 family residential properties		1,656,837			1,660,043			1,592,453			1,620,013			1,640,015
Secured by nonfarm, nonresidential properties		2,064,352			2,034,176			1,916,153			1,900,784			1,893,240
Other real estate secured		399,636			318,148			317,680			323,734			273,752
Commercial and industrial loans		1,540,783			1,528,434			1,421,382			1,466,511			1,368,464
Consumer loans		166,314			170,562			170,073			166,436			164,544
State and other political subdivision loans		910,493			917,515			875,973			805,401			787,049
Other loans		406,315			390,898			438,805			403,864			443,458
LHFI		8,004,657			7,851,213			7,499,204			7,405,181			7,268,022
Allowance for loan losses		(72,445	)		(71,265	)		(70,871	)		(71,796	)		(69,668	)
Net LHFI	$	7,932,212		$	7,779,948		$	7,428,333		$	7,333,385		$	7,198,354

ACQUIRED LOANS BY TYPE (1)	3/31/2017			12/31/2016			9/30/2016			6/30/2016			3/31/2016
Loans secured by real estate:
Construction, land development and other land loans	$	17,651		$	20,850		$	25,040		$	38,016		$	41,484
Secured by 1-4 family residential properties		54,721			69,540			76,601			81,676			89,878
Secured by nonfarm, nonresidential properties		92,075			103,820			110,606			119,698			129,856
Other real estate secured		16,275			19,010			20,903			25,272			25,506
Commercial and industrial loans		20,691			36,896			39,519			49,760			52,806
Consumer loans		2,664			3,365			3,878			4,295			5,027
Other loans		14,165			18,766			19,190			20,318			20,198
Acquired loans		218,242			272,247			295,737			339,035			364,755
Allowance for loan losses, acquired loans		(10,006	)		(11,397	)		(11,380	)		(12,480	)		(13,535	)
Net acquired loans	$	208,236		$	260,850		$	284,357		$	326,555		$	351,220