Trustmark
Annual Report 2017

Plain-text annual report

2017 Annual Report Trustmark Corporation VISION Our vision is to be a premier financial services company in our marketplace. MISSION Our mission is to achieve outstanding customer satisfaction by providing banking, wealth management and insurance solutions through superior sales and service, utilizing excellent people, teamwork and diversity, while meeting our corporate financial goals. VALUES Integrity • Service • Accountability • Relationships • Solutions TABLE OF CONTENTS Letter to Shareholders Board of Directors Corporate Information Executive Management Regional and Market Executives Community Market Advisory Directors Financial Highlights Company Profile 2 8 10 12 13 14 19 22 TO OUR SHAREHOLDERS Trustmark continued to achieve solid financial performance in 2017 as a result of the strength and vitality of our diverse banking and financial services franchise. We continued to build upon and expand customer relationships, reflecting our desire to be a true financial partner for our customers. From a banking perspective, total assets expanded to $13.8 billion, driven primarily by our fourth consecutive year of robust organic loan growth. We also maintained cost-effective core deposit growth. Credit quality, a defining characteristic of the Trustmark franchise, remained solid as net charge-offs continued at historically low levels. In addition to our traditional banking business, our mortgage banking, insurance and wealth management businesses all made progress toward their strategic initiatives and played significant roles in our financial results. Collectively, the success of our diverse banking and financial services businesses is reflected in record total revenue of $592.2 million in 2017, an increase of $30.7 million, or 5.5%, from the prior year. Our focus on providing financial and risk management solutions to meet customers’ needs with integrity and accountability has garnered numerous customer satisfaction awards, including being recognized as the 2017 Best Bank in the South Region by Kiplinger. Technology and evolving customer preferences are reshaping the industry, and Trustmark is responding accordingly. While much has changed, the need for trustworthy financial solutions remains. The financial services business remains a people business. Our associates, instilled with Trustmark’s enduring core values and equipped with appropriate technology, are providing customers with trusted financial advice and exceptional service every day. We would like to take this opportunity to reflect upon our in 2017, share our direction accomplishments for the future and highlight a few of the ways Trustmark is positioned for continued success in the years to come. FINANCIAL HIGHLIGHTS Trustmark’s net income in 2017 totaled $105.6 million, which represented diluted earnings per share of $1.56. Excluding non-routine items, net income was $130.6 million, or $1.92 per diluted share, an increase of 12.9% from comparable levels in 2016. This performance, excluding non-routine items, produced a return on average tangible equity of 11.53% and a return on average assets of 0.95%. Trustmark paid quarterly cash dividends to shareholders of $0.23 per share, or $0.92 annually, in 2017. During the year, over half of Trustmark’s net income was returned to shareholders through dividends, which have grown – and never decreased – throughout Trustmark’s 128-year history. This consistent, reliable source of shareholder income reflects the steady earnings and profitability of our diversified financial services businesses. Loans held for investment totaled $8.6 billion at year- end 2017, up $718.8 million, or 9.2%, from the prior year. Growth was diversified by loan type as well as by geographic market, both categories of which reflect the value of our commercial relationship managers, lending product suite and five-state franchise. Collectively, held for investment and acquired loans totaled $8.8 billion at December 31, 2017, an increase of 8.7% from the prior year. Our diversified, low-cost core deposit base remains a source of strength of the Trustmark franchise. At year-end 2017, deposits totaled $10.6 billion, an increase of $521.5 million, or 5.2%, from the prior year. Nearly 59% of deposits are in checking accounts, including over 29% in noninterest-bearing accounts. We know our customers have many financial institutions from which to choose and are pleased that they have chosen Trustmark as their trusted financial partner. Experience and attention to customer relationships have afforded Trustmark 2 a position of leadership in the majority of the communities we serve. We are privileged to have a #1 deposit share ranking in not only the Jackson metropolitan area, but also the state of Mississippi and, across the franchise, a top-four deposit share ranking in 69% of counties served. CREDIT QUALITY Disciplined underwriting, pricing and credit management continue to be defining hallmarks of Trustmark. Nonperforming assets, driven by a 30.3% decline in other real estate, improved in 2017. Net charge-offs to average loans remained at a historically low level of 11 basis points during the year. At December 31, 2017, allocation of Trustmark’s $76.7 million allowance for loan losses represented 320% of nonperforming loans, excluding impaired loans. The foregoing credit metrics exclude acquired loans. RISK MANAGEMENT AND CAPITAL STRENGTH Trustmark is committed to a comprehensive, enterprise-wide risk management approach to not only ensure regulatory compliance, but to also manage the Corporation and its businesses more effectively. In achieving our plans for continued growth, risk management is integral to both the strategic planning process as well as the process for new product and service introductions. Our Board remains actively engaged in reviewing risk management and ensuring that liquidity, funding levels are reflective of a strong and capital financial institution. At December 31, 2017, total shareholders’ equity was $1.6 billion, while tangible common equity totaled $1.2 billion, which represented 8.77% of tangible assets. Trustmark’s regulatory capital ratios continue to significantly exceed levels to be classified as well capitalized. We continue to From Kiplinger's Personal Finance, May © 2017 The Kiplinger Washington Editors. All rights reserved. Used by permission and protected by the Copyright Laws of the United States. The printing, copying, redistribution, or retransmission of this Content without express written permission is prohibited. review opportuniti es to deploy capital in a manner that enhances long-term shareholder value, including investments that support organic or acquisiti ve growth, delivering consistent dividends and uti lizing share repurchase programs as appropriate. REVENUE GENERATION Trustmark derives revenue through net interest income generated by our banking business as well as through noninterest income provided by our banking, insurance, wealth management and mortgage banking businesses. Our total revenue reached a record level of $592.2 million in 2017, an increase of $30.7 million, or 5.5%, from the prior year. Excluding acquired loans, revenue totaled $567.7 million, up $36.4 million, or 6.9%. Net interest income (FTE), excluding acquired loans, totaled $402.9 million in 2017, an increase of $27.1 million, or 7.2%, from the prior year and resulted in a net interest margin, excluding acquired loans, of 3.36%. Our diverse fee-income businesses conti nued to achieve solid results signifi cantly and to success; fi nancial noninterest income represented total approximately 33% of revenue, acquired loans, in 2017. Profi table revenue generati on has been, and will conti nue to be a central focus of Trustmark. contributed our excluding Insurance, Fisher Brown Bott rell Inc., our insurance agency subsidiary, had another record year in 2017 as revenue increased 3.8% to $38.2 million. This performance refl ects our conti nuing focus on business development as well as expansion to new markets, including Birmingham, Alabama, and Nashville, Tennessee. Fisher Brown Bott rell, which provides a full range of commercial and personal risk management products, was recognized as a 2017 Best Practi ces Agency by Independent Insurance Agents and Brokers of America. Our Wealth Management business—which provides comprehensive and integrated 4 services to accumulate, preserve and transfer wealth— produced revenue of $30.3 million in 2017. Wealth management assets totaled $12.4 billion, up 4.4% from the prior year. Refl ecti ng the signifi cance and growth potenti al of this business, Trustmark will be transiti oning to a state-of-the-art wealth management operati ng platf orm that will signifi cantly enhance our product and service capabiliti es. Additi onally, we will be introducing meaningful improvements to our reti rement plan services program designed to provide customers with expanded product off erings. Trustmark’s Mortgage Banking business posted another year of solid results, due in part to additi onal retail mortgage originators as well as expansion to new markets. In 2017, revenue expanded $1.7 million, or 6.0%, to total $29.9 million, while loan producti on totaled $1.4 billion. During the year, we introduced enhanced technology applicati ons and workfl ow redesign to promote additi onal growth and profi tability. EXPENSE MANAGEMENT Trustmark is committ ed to conti nuous improvement and has a proven process for investi ng in our businesses to promote growth and effi ciency. As we have stated on numerous occasions, expense management at Trustmark is not a one-ti me program, but is rather a long-standing culture to ensure value is maximized from each dollar spent. In 2016, a voluntary early reti rement program was implemented to provide organizati onal effi ciencies resulti ng from investments in technology and realignment of work processes. In 2017, the Corporati on’s defi ned benefi t pension plan was terminated. Each of these acti ons was initi ated to reduce expenses and improve effi ciency. In 2017, noninterest expense totaled $430.2 million. Excluding the non-routi ne charges related to the terminati on of the pension plan and merger-related charges, operati ng noninterest expense totaled $409.3 million in 2017, up 3.3% compared to comparable is committ ed to in 2016. Trustmark levels investments that promote profitable revenue growth as well as reengineering and efficiency opportunities that enhance long-term shareholder value. INVESTING FOR THE FUTURE Trustmark is committed to meeting the needs its customers and their evolving banking of preferences. We embrace the opportunity to utilize new technologies to meet customer needs, expand product offerings and refine delivery channels that enhance the customer experience while reducing servicing costs. Several years ago we upgraded our ATM fleet to enhance same-day deposit credit capabilities and strengthen our competitive advantage. Customers embraced the technology, and deposits made via ATMs increased significantly. Since the release of myTrustmark®, our consumer digital banking service, adoption of online banking has notably increased with approximately two-thirds of customers accessing myTrustmark® via mobile devices. Through Trustmark’s mobile banking platform, customers are able to monitor accounts, pay bills, transfer funds, deposit checks and track spending habits across multiple accounts, including those of other financial institutions. In 2017, we introduced myTrustmark® Business, a robust digital banking service for commercial customers. We remain excited about the opportunities this platform, in addition to others, may present for our franchise. Trustmark recently renovated an office in Memphis, Tennessee, that now includes Starbucks® in an effort to increase foot traffic and create additional opportunities to introduce Trustmark products and services to prospective customers. Trustmark also initiated a pilot program introducing myTeller℠, an interactive video teller service provided through a centralized teller center that delivers most functions provided by traditional tellers, at this Memphis location as well as the University of Mississippi Medical Center in Jackson, Mississippi, and other select locations. The potential applications for this technology include deployment beyond the traditional branch network and expanded service hours, further enhancing customer convenience and improving operational efficiency. We continued to realign our branch network to reflect our customers’ evolving preferences for online and mobile account access. Still, customers value face-to-face interaction in our branches and the personal aspect of the banking relationship. As consumer preferences evolve, we will strive to provide a consistent Trustmark experience, regardless of the delivery channel. During 2017, Trustmark consolidated three branch offices and reallocated a portion of those resources to opening a new banking center. Over the last 5 years, Trustmark has consolidated 38 branch offices with limited growth potential and established 10 banking centers in attractive growth markets. and lines In addition to expanding product refining delivery channels, Trustmark previously its completed with merger announced Reliance Bank, headquartered in Athens, Alabama, in the second quarter of 2017. With assets of approximately $200 million, Reliance Bank has seven offices serving the Huntsville MSA, one the most attractive growth markets in the Southeast. LEADERSHIP We are extremely appreciative of the leadership, counsel and guidance provided by Trustmark’s Board of Directors. Our directors are engaged in the governance of the organization, embrace the Corporation’s strategic direction and support our efforts to realize the full potential of the franchise. During the year, Daniel A. Grafton retired from the Trustmark Board after eleven years of dedicated service, including six as our Chairman. We have greatly appreciated Dan’s contributions to Trustmark and will miss his advice and counsel. Cooperative Energy; Dr. J. Clay Hays, Jr., President of Jackson Heart Clinic, PA; and Harry M. Walker, former President, Trustmark National Bank. Having previously served on the Board of Trustmark National Bank, these individuals have a solid understanding of the financial services industry and, with their diverse experiences and backgrounds, are well-positioned to provide valuable guidance to the Corporation. COMMUNITY INVOLVEMENT Our commitment to the communities we serve is unwavering. During 2017, Trustmark’s charitable giving exceeded $3.0 million, providing support for programs and services benefitting youth, education, the arts, health and social services and community- based organizations. In addition, our associates provided more than 11,000 hours of volunteer time through participation in than 750 community more events designed to improve the quality of life for our friends and neighbors. Trustmark provided low-to- moderate income borrowers approximately $120 million in home mortgages and more than $75 million in community development loans. Our collaborative work with community service providers, developers, realtors, housing advocates and others resulted in over $27 million in investments that provide affordable housing, employment and community services for those with low-to-moderate incomes, which is a reflection of our commitment to strengthen the communities we serve. STRATEGIC FOCUS We were pleased to welcome to the Trustmark Corporation Board four new directors in 2017: William A. Brown, President and Chief Executive Officer of Brown Bottling Group; James N. Compton, President and Chief Executive Officer of Trustmark to pursue is well positioned opportunities for growth, navigate the changing competitive landscape and, most importantly, help our customers achieve financial success. As such, we look to the future with great confidence and 6 optimism. In 2018, we will continue our efforts to broaden customer relationships, enhance the delivery of our products and services and streamline processes to drive greater efficiency, all of which are designed to increase shareholder value. We would like to thank our associates for their dedication and commitment, our shareholders who have invested in Trustmark and its future and our customers who look to us as their financial partner. Trustmark is “People you trust. Advice that works.” Sincerely, R. Michael Summerford Chairman Trustmark Corporation Gerard R. Host President and Chief Executive Officer Trustmark Corporation TRUSTMARK CORPORATION AND TRUSTMARK NATIONAL BANK BOARD OF DIRECTORS Adolphus B. Baker Chairman, President and Chief Executive Officer Cal-Maine Foods, Inc. Toni D. Cooley Chief Executive Officer Systems Electro Coating William A. Brown President and Chief Executive Officer Brown Bottling Group, Inc. J. Clay Hays, Jr., M.D. Cardiologist, Partner and President Jackson Heart Clinic, PA James N. Compton President and Chief Executive Officer Cooperative Energy Gerard R. Host President and Chief Executive Officer Trustmark Corporation and Trustmark National Bank Tracy T. Conerly Partner Emeritus Carr, Riggs & Ingram, LLC John M. McCullouch Associate Dean - Metro Jackson University of Mississippi School of Law (Retired) President, AT&T Mississippi (Retired) 8 9 Harris V. Morrissette President China Doll Rice & Beans, Inc. / Dixie Lily Foods Harry M. Walker President Mississippi Business and Community Relations Trustmark National Bank (Retired) Richard H. Puckett Chairman and Chief Executive Officer Puckett Machinery Company LeRoy G. Walker, Jr. President LTM Enterprises, Inc. R. Michael Summerford Chairman Trustmark Corporation and Trustmark National Bank Chief Operating Officer ChemFirst, Inc. (Former) William G. Yates III President and Chief Executive Officer W.G. Yates & Sons Construction Company 9 SHAREHOLDER REQUESTS AND ACCOUNT ACCESS Shareholders may contact AST through one of the following methods: Online: Registered shareholders can view their account information through AST’s website at astfinancial.com by clicking on Login and selecting Shareholder Central. This website provides instructions on how to gain access to shareholder account information, perform certain transactions, request forms or participate in the Plan. Shareholders may also e-mail our transfer agent at help@astfinancial.com. Telephone: Shareholders may call our (877) 476-4393 for assistance. toll-free number Written Correspondence: Shareholders should mail written account inquiries or other requests for assistance regarding stock ownership to: Trustmark Corporation c/o American Stock Transfer & Trust Company, LLC Operations Center 6201 15th Avenue Brooklyn, NY 11219 CORPORATE INFORMATION COMMON STOCK Trustmark common stock is listed on the NASDAQ Global Select Market and is traded under the symbol TRMK. SHAREHOLDER SERVICES Trustmark’s shareholder services are provided by American Stock Transfer & Trust Company, LLC (AST). AST will assist with: Registration status Dividend payments Change of address Lost certificates Transfer of ownership Other inquiries or requests DIVIDEND REINVESTMENT AND STOCK PURCHASE AND SALE Trustmark is pleased to offer the Investors Choice Dividend Reinvestment & Direct Stock Purchase and Sale Plan (Plan), a voluntary plan administered by AST. Under the Plan, shareholders may reinvest dividends, purchase additional shares, sell all or part of shares owned or deposit their Trustmark stock certificates for safekeeping or sale. For more information, call (877) 476-4393 or visit AST’s website at astfinancial.com. FINANCIAL PUBLICATIONS AVAILABLE AT NO CHARGE Additional copies of Trustmark’s Annual Report on Form 10-K, quarterly reports and other corporate publications are available, without charge, at trustmark.com or upon request by calling our Investor Relations Department at (601) 208-6898 or by writing to: Trustmark Corporation Attn: Investor Relations 248 East Capitol Street Jackson, MS 39201 10 11 INVESTOR INQUIRIES Analyst and investor inquiries may be directed to: MEDIA INQUIRIES Media representatives seeking general information should contact: Louis E. Greer Treasurer and Principal Financial Officer (601) 208-2310 lgreer@trustmark.com F. Joseph Rein, Jr. Senior Vice President (601) 208-6898 jrein@trustmark.com Melanie A. Morgan Senior Vice President (601) 208-2979 mmorgan@trustmark.com ANNUAL MEETING OF SHAREHOLDERS Trustmark Corporation’s Annual Meeting of Shareholders will be held on Tuesday, April 24, 2018, at 1:00 p.m. Central Time at Trustmark’s Corporate Office located at 248 East Capitol Street, Jackson, Mississippi. TRUSTMARK CORPORATION OFFICERS R. Michael Summerford Chairman Gerard R. Host President and Chief Executive Officer Louis E. Greer Treasurer and Principal Financial Officer Granville Tate, Jr. Secretary F. Joseph Rein, Jr. Assistant Secretary 11 TRUSTMARK NATIONAL BANK EXECUTIVE MANAGEMENT EXECUTIVE Gerard R. Host Monica A. Day President and Chief Executive Officer Executive Vice President and Real Estate Banking Manager Duane A. Dewey President – Corporate Banking Louis E. Greer Executive Vice President and Chief Financial Officer Robert B. Harvey Executive Vice President and Chief Credit Officer Glynn Ingram Executive Vice President and Chief Information Officer James M. Outlaw, Jr. Executive Vice President and Chief Administrative Officer Thomas C. Owens Executive Vice President and Bank Treasurer W. Arthur Stevens President – Retail Banking Granville Tate, Jr. Executive Vice President, Chief Risk Officer and General Counsel Breck W. Tyler President – Mortgage Services C. Scott Woods President – Insurance and Wealth Management 12 13 TRUSTMARK NATIONAL BANK REGIONAL AND MARKET EXECUTIVES REGIONAL PRESIDENT REGION MARKET PRESIDENT William S. Bridges Houston Michael D. Fitzhugh Alabama/Mississippi Gulf Coast Aubrey E. Henson, Jr. Memphis/North Mississippi Charles H. Lewis IV South Mississippi W. Mark Lewis Central Mississippi Linwood O. McClain Central Alabama Leonard P. Hein, Southeast Houston Christine Petrilla, North Houston Travis H. Van Horn, Southwest Houston Eric C. Brown, Mississippi Gulf Coast Kevin S. Carey, Mobile, AL Paul J. England, Monroeville, AL Tommy B. Faust, Jr., Baldwin County, AL Deborah C. Hardee, Brewton, AL William C. Hart, Pensacola, FL John David Douglas, Fayette County, TN Victor L. Marlar, Corinth, MS R. Andrew McGahey, Greenville, MS J. Clifton Thach, Greenwood, MS Jason A. Douglas, McComb, MS Stanley L. Foster, Brookhaven, MS Brandon S. Hubbard, Magee, MS Charlie Scott King, Tylertown, MS Joe B. Madden, Hazlehurst, MS Charles T. Magee, Columbia, MS Darrell W. Temple, Taylorsville, MS David G. (“Archie”) Anderson, Meridian, MS J. Gregory Bennett, Laurel, MS Michael E. Crandall, Canton, MS Thomas Kendall, Vicksburg, MS Charles R. Russell, Tupelo, MS Larry A. Waggoner, Carthage, MS Bart C. Wise, Columbus, MS Dave Crenshaw, Greenville, AL David C. Darby, Montevallo, AL James B. Hurst, Opelika, AL William V. Lewis, Tuscaloosa, AL Charles R. Schaeffer, Eufaula, AL R. Wade Seamon, Prattville, AL Charles E. Singleton, Demopolis, AL James A. Stewart, Centreville/Selma, AL John D. Sumrall Florida John G. Hindsman, Bay County Jonathan E. Ochs, Okaloosa and Walton Counties 13 TRUSTMARK NATIONAL BANK COMMUNITY MARKET ADVISORY DIRECTORS ALABAMA Brewton Steve Edmonds President Windwood Management Group Mo Erkins Military (Retired) Stephanie Kemmer Probate Judge Bibb County Debbie Martin Funeral Director/Office Administrator Rocko Funeral Home J.W. Oakley Recruiting Coordinator School of Communications University of Alabama Demopolis Gary B. Butler President Butler & Company, Inc. Johnnie Anderson Shows II Owner Jaber, Inc. Loyd Todd Tally President Trustmark National Bank Mary Foy Kirkland President Young Johnston and Associates, Inc. Charles R. Schaeffer President Trustmark National Bank Joel Smith, Jr. Attorney Williams, Potthoff, Williams & Smith Robert L. Taylor Owner Bobby Taylor Enterprises Deltonya Warren Director of Childhood/ Federal Programs Eufaula City Schools Doug Winkleblack Southern Regional Manager Alabama Interforest Corp Greenville Mem Stewart Webb Owner Webb Realty, Inc. Barry E. Boan President Boan Contracting Dexter McLendon Mayor City of Greenville Allin Whittle Butler County Commissioner Warren J. Williamson Attorney Williamson & Williamson (Retired) Huntsville John R. Baggette, Jr. Attorney and Shareholder Sirote & Permutt, P.C. Michael R. Hockman Senior Vice President Trustmark National Bank David A. Hunt Administrator/Owner Limestone Health Facility, Inc. Robert F. Harwell, Jr. President Trustmark National Bank Babu R. Kahani Manager Tennessee Valley OB/GYN Clinic, P.C. H. C. “Harry” Cecil Program Specialist Alabama Technology Network Broox G. Garrett Attorney Thompson, Garrett & Hines Chris B. Griffin Administrator D.W. McMillan Memorial Hospital Deborah C. Hardee President Trustmark National Bank Mark Manning Administrator West Gate Village Nursing Home Cosby Martin Owner Marco Land & Petroleum Thomas E. McMillan, Jr. Managing Member Longleaf Energy McGowin Miller President Miller Relocation Services Steve Nelson Banker (Retired) Stephanie Walker Preschool Director St. Stephen’s Episcopal Church Centreville John Downs Business Office Manager Alabama Power Company Thomas Alvin Williams Partner Morgan’s Ice Ken Chesser Owner KC Land & Cattle Company James E. McClary President and Owner McClary Tire Company Dan E. Wilson Owner Colony Office Products Dave Crenshaw President Trustmark National Bank Timothy A. Smalley CPA Byrd, Smalley & Adams P.C. Eufaula Robert M. Dixon, Jr. Chief Executive Officer M.C. Dixon Lumber Company, Inc. P. Richard Hartley Partner Hartley & Hickman Attorneys at Law John H. McGowin Owner/President McGowin Logging Co., Inc. Robert E. Thurber Investor Michael E. Underwood CEO TriGreen Equipment LLC 14 15 Mobile/Baldwin County Alfred M. Newmann, Jr., MD Premier Medical ENT West Sumner G. Adams Vice President Cash Management/Finance Norton Lilly International Henry F. O’Connor III Attorney Jones Walker LLP Tommy B. Faust, Jr. President Trustmark National Bank — Baldwin County E. Luckett Robinson II Vice President - Finance Overseas Hardwoods Company, Inc. (OHC) Sandy Smith Director Monroeville Area Chamber of Commerce (Retired) Montevallo David C. Darby President Trustmark National Bank Philip C. Hubbard Veterinarian Countryside Animal Hospital Karen Kelly Director of Compensation & Benefits U.S. Pipe and Foundry Company (Retired) J.N. Buckner Partner Buckner and Cook, LLC Keith Gamble Owner FirstGuard, LLC David McDowell Partner McDowell, Faulk and McDowell, LLC R. Wade Seamon President Trustmark National Bank Selma Tommy Atchison Attorney Atchison Injury Attorneys, LLC Leroy Lucas, Jr. Owner Lelco, Inc. Denson Henry Vice President Henry Brick Co. Montgomery David Sutley President — Baldwin County Trustmark National Bank (Retired) Monroeville Pete Black Alabama Business Development Manager Parsons & Whittemore Haniel Croft President BankTrust (Retired) Paul J. England President Trustmark National Bank George Traweek Dickson President and CEO Joe Hudson’s Collision Center John E. Estes, Jr. Vice President J. E. Estes Wood Company, Inc. Phyllis Ingram Partner/Shareholder Carr, Riggs & Ingram, LLC Sloan Fountain Vice President/Manager Vanity Fair Mills, Inc. (Retired) Leonard N. Math Partner/Shareholder Chambless, Math & Carr, PC Attorneys at Law Ed Lee, DMD Dentist John T. Lee President Pilots for Christ Alex Roberts Photographer Alex Roberts Photography (Retired) Steven L. Reed Probate Judge Montgomery County Prattville John Boutwell Owner Boutwell Farms 15 S. Kirk Johnson Owner Oxford Manufacturing Edward T. Livingston Regional President Trustmark National Bank (Retired) Johnny Moss III Director of Marketing & College Relations Wallace Community College - Selma James A. Stewart President Trustmark National Bank William P. Swift III Owner Swift Drug Co. Abigail Tucker, DMD Owner/Dentist Tucker Family Dentistry Frank McKinley Bell III President Marine Rigging, Inc. Kevin S. Carey President - Mobile Trustmark National Bank Jacob L. Cunningham Manager Summit Industries, LLC David A. Dye Chairman and Chief Growth Officer Computer Programs and Systems, Inc. (CPSI) Thomas Gross Chief Financial Officer Battle Plan Capital, LLC Truland Homes, LLC H. Ray Hix, Jr. Partner/Manager Hix Snedeker Companies, LLC Clifton C. Inge, Jr. Chief Executive Officer IPC Industries, Inc. Frank J. Lott III President Heritage Homes Harris V. Morrissette President China Doll Rice & Beans, Inc./ Dixie Lily Foods TRUSTMARK NATIONAL BANK COMMUNITY MARKET ADVISORY DIRECTORS Ira M. Wagoner Accountant Edwards and Wilkinson, PC James (Jay) R. Moody IV CPA/Member Warren Averett, LLC Tallassee Cecil Mack Daugherty Chief of Security Russell Lands Gary Fuller Owner Fuller Warehouse & Gin, Inc. James B. Hurst President Trustmark National Bank Charles Frank Keith Owner Johnson Furniture David Lawrence Owner Tallassee Super Foods, Inc. Hollis Mann Store Manager Tallassee Super Foods, Inc. Jennie Rhinehart Chief Executive Officer Community Hospital, Inc. FLORIDA Floyd Skinner President Skinner Tax Consulting, Inc. David Spencer President Glass Center, Inc. John D. Sumrall Regional President Florida Trustmark National Bank Jay N. Trumbull Owner Culligan Water Solutions Dennis A. Wallace Walton County School Board (Retired) Real Estate Investor Lumber Distributor MISSISSIPPI Brookhaven Robert O. Allen Partner Allen, Allen, Breeland & Allen, PLLC Angus G. Andrews, Jr. Real Estate Investor/ Developer Cecil Estess Corporate Officer Dickerson & Bowen Tracy T. Conerly Partner Emeritus Carr, Riggs & Ingram, LLC Robin Tyler Faust, CFSP Funeral Director Tyler Funeral Home, Inc. Gerald R. Dunkle President Sundial Developers, Inc. Stanley L. Foster President Trustmark National Bank Robert C. McLendon Executive Vice President Fisher Brown Bottrell Insurance, Inc. Kenneth W. Goza Program Coordinator Copiah Lincoln Community College Arlustra Henderson, Jr. Chief of Police City of Brookhaven (Retired) J. Spencer Mooney, MD Physician/Owner Quail Ridge Enterprise, Inc. J. Kim Sessums, MD Physician Brookhaven OB-GYN Associates Charlie Lee Smith Chief Executive Officer Southern Diversified Technologies, Inc. A. Lavelle Sullivan Co-Owner Sullivan Ford-Lincoln Carthage Columbus Mark G. Alexander Chairman Dynahealth, Inc. William Key Blair, Jr. Vice President Columbus Marble Works W. R. Phillips IV Vice President Phillips Contracting Company, Inc. Bart C. Wise President Trustmark National Bank Corinth Victor L. Marlar President Trustmark National Bank Carl Blocker Sales Greco Electrical Contractor William J. Napier III President Corinth Mill Supply Lee Carson President N.L. Carson Construction, Inc. Ricky R. Stockton Hotel Manager S.S.S.S. &P., Inc. Susan Triplett Administrator Northeast Region Sta-Home Health Larry A. Waggoner President Trustmark National Bank Jason Wilcox President/Owner Wilcox Funeral Home Steve Wilkerson Owner Steve’s on the Square Kenneth W. Williams President Corinth Coca-Cola Bottling Works Refreshments, Inc. Greenville Paul D. Dees Partner Greenland Planting Company Stephen R. Jernigan Owner River City Rehabilitation R. Andrew McGahey President Trustmark National Bank 16 17 Harley Metcalfe III Investor (Retired) Steven R. Millwood President Mississippi Marine Corporation Greenwood H. Don Brock, Jr. Partner Whittington Brock & Swayze Alexander John Malouf III Co-Owner The John Richard Collection, Inc. R.A. Norris President S&N Airflow, Inc. Clifton Thach President Trustmark National Bank Robert L. Upchurch President Upchurch Plumbing, Inc. Hattiesburg Hugh Bolton Executive Vice President Trustmark National Bank (Retired) Jeff C. Bowman Senior Vice President/ Chief Administrative Officer Cooperative Energy Thomas M. Duff Managing Partner Southern Tire Mart, LLC John M. Fitzpatrick III, MD President and Physician Hattiesburg Clinic, PA Linda Kuykendall Vice President Commercial Business Interiors, Inc. Charles H. Lewis IV Regional President South Mississippi Trustmark National Bank W. A. Payne III President Camellia Home Health Robert O. Tatum, Jr. Principal/Owner CR Properties, LLC Robert R. Vardaman Owner and President Vardaman Buick-Honda, Inc. Hazlehurst Olen C. Bryant, Jr. Attorney Bryant & Rutland, PLLC Joe B. Madden President Trustmark National Bank Fred J. McDonnell, MD Physician Copiah Medical Associates John C. Pyron Co-Owner Copiah Forest Products, Inc. Copiah Lumber Company, Inc. A. Wendell Stringer President Stringer Family Funeral Services Laurel Louis S. Crumbley President Crumbley Paper & Food Service Co., Inc. Linda R. Gavin Associate Executive Director of Marketing South Central Regional Medical Center Jerome Harless President Flarestack, Inc. (Retired) Victor Jones, Jr. Salesman Mississippi Ag Company Rhes V. Low, Sr. Investor Low Company, LLC Richard L. Yoder, Jr. Attorney Gilchrist Sumrall Yoder & Boone, PLLC James Price Wallace Owner and Manager River Birch Farm McComb Pat H. Brumfield, Jr. President Brumfield Oil Company, Inc. Brad Clark President Clark Construction Co., Inc. of Mississippi David B. Craddock President Craddock Oil Company Jason A. Douglas President Trustmark National Bank John Dale Dumas, DMD John Dale Dumas PA Michael Faust CPA Faust & Associates Magee Julie Polk Breazeale Chief Executive Officer Polk’s Meat Products, Inc. Jacqueline P. Gordy Secretary-Treasurer Pace Oil Company Craig Haskins Vice President Commercial Developers, Inc. Eric S. Lewis, MD Surgeon Southwest Mississippi Oral & Maxillofacial Surgery, Inc. Brandon S. Hubbard President Trustmark National Bank John Andrew Watson Medical Director STATCare Medical Clinics Charles Pruitt III, MD Physician Magee Medical and Surgical Clinic, PLLC Meridian David G. “Archie” Anderson President Trustmark National Bank Cole Cardwell Vice President/ General Manager Structural Steel Services, Inc. J. Gregory Bennett President Trustmark National Bank James H. Stuard, DMD James Stuard Family Dentistry 17 TRUSTMARK NATIONAL BANK COMMUNITY MARKET ADVISORY DIRECTORS TENNESSEE Fayette County Charles E. Dacus, Jr. Farmer Dacus Farms John David Douglas President Trustmark National Bank Paul S. Harris General Manager Chickasaw Electric (Retired) Aubrey E. Henson, Jr. Regional President Memphis/North Mississippi Trustmark National Bank John S. Wilder, Jr. Treasurer and General Manager Long Town Gin & Supply Jay L. Davidson President and Director Southern Pipe & Supply, Inc. Tommy E. Dulaney President and Chief Executive Officer Structural Steel Services, Inc. Billy W. Estes President Trustmark National Bank (Retired) Larkin Kennedy Executive Vice President/ Administrator Rush Foundation Hospital Adam Mitchell Chief Executive Officer Mitchell Distributing Company D. Colin Maloney President Century Construction Group, Inc. Elizabeth J. Randall President Randall Commercial Group, LLC Charles R. Russell President Trustmark National Bank David S. Talton, MD President Cardiothoracic Surgery Clinic of North Mississippi Tylertown Vicksburg Ronald L. Andrews, Sr. President Vicksburg Insurance Agency, Inc. Robert R. Bailess Partner Bailess & Rector, LLP W. Briggs Hopson III Partner Teller, Hassell & Hopson, LLP Donald Jarratt Managing Partner Jarratt Properties, LLC Timothy O. Jones Assistant District Attorney 14th Judicial District Thomas Kendall President Trustmark National Bank John M. Mitchell, Jr. Owner The Mitchell Companies Steven L. Kennedy Owner Tylertown Sports Center C.D. Smith, Jr. Regional Manager AT&T Mississippi Tupelo V.M. Cleveland President Tupelo Furniture Market Johnny L. Crane II President F.L. Crane & Sons, Inc. Carlyle S. Harris, Jr. General Partner Harris Holdings LP Charlie Scott King President Trustmark National Bank Rob Loper, DVM Veterinarian Tylertown Animal Hospital I. Conrad Mord II Attorney Mord Law Firm J. Keith Speed, DO Doctor of Osteopathy William Carey University Samuel L. Pierce, MD Partner Medical Associates of Vicksburg PLLC James O. Smith III President Big River Shipbuilders, Inc. Patrick R. Smith President Yazoo River Towing, Inc. President Vicksburg Plant Food, Inc. Howard C. (Charles) Waring, Jr. Sales Manager Waring Oil Company, LLC 18 19 TRUSTMARK CORPORATION FINANCIAL HIGHLIGHTS ($ in thousands except per share data) Net Income Per Share Data Basic earnings per share Diluted earnings per share Dividends Book value Tangible book value Performance Ratios Return on average tangible equity Return on average equity Return on average assets Capital Ratios Total equity/total assets Tangible equity/tangible assets Tier 1 leverage ratio Tier 1 risk-based capital ratio Total risk-based capital ratio Year-end Balance Sheet Data Securities Loans Total assets Total deposits Total borrowings Total shareholders’ equity Non-GAAP Financial Measures (1) Net Income Diluted earnings per share Return on average tangible equity Return on average equity Return on average assets 2017 2016 $ $ $ $ 105,630 1.56 1.56 0.92 23.20 17.35 9.39 % 6.77 % 0.77 % 11.39 % 8.77 % 9.67 % 12.33 % 13.10 % 3,295,121 9,011,996 13,797,953 10,577,512 1,503,678 1,571,701 130,599 1.92 11.53 % 8.37 % 0.95 % $ $ $ $ 108,411 1.60 1.60 0. 92 22.48 16.76 9.99 % 7.14 % 0.84 % 11.39 % 8.74 % 9.90 % 12.76 % 13.59 % 3,515,325 8,299,387 13,352,333 10,056,012 1,622,500 1,520,208 115,280 1.70 10.60 % 7.59 % 0.89 % (1) Trustmark discloses certain non-GAAP financial measures, including net income adjusted for significant non-routine transactions as a measure of our core operating business, as these transactions are generally not operational in nature. Reconciliations of these non-GAAP measures to comparable measures calculated in accordance with generally accepted accounting principles can be found under Part II, Item 7 in Trustmark Corporation’s Annual Report on Form 10-K for the year ended December 31, 2017, filed with the SEC on February 20, 2018. 19 PROFILE ONE OF THE SOUTH’S OLDEST AND STRONGEST BANKS Founded in 1889, Trustmark is one of the South’s strongest and most respected financial institutions and serves customers in over 190 locations throughout Alabama, Florida, Mississippi, Tennessee and Texas. We offer a comprehensive range of personal and business banking services - from personal banking and wealth management, to small business checking and large, complex commercial loans. Through our subsidiaries, including Trustmark National Bank, Trustmark Investment Advisors, Inc., and Fisher Brown Bottrell Insurance, Inc., we have been serving families, businesses and communities for 128 years. We are a community-focused, values-guided organization making a difference in the lives of our customers and communities. We are committed to service excellence and strive daily to exceed expectations. OUR BUSINESS At Trustmark, we believe in building strong customer relationships, and we work hard to know and understand our customers and their financial needs. Equipped with this knowledge, we are best positioned to meet their needs with our comprehensive suite of products and services. PERSONAL BANKING Deposit and loan accounts for every lifestyle and preference MORTGAGE BANKING Home financing options for any situation and budget COMMERCIAL BANKING Deposit and loan accounts for all sizes of commercial customers and designed to complement a variety of business functions WEALTH MANAGEMENT¹ Personalized strategies to assist clients to accumulate, preserve and transfer wealth RISK MANAGEMENT¹ Appropriate risk management strategies to protect your assets offered through Fisher Brown Bottrell Insurance, Inc. For more information about our full line of products and services, visit trustmark.com. 1Wealth Management and Risk Management products are: Not FDIC Insured | Not Bank Guaranteed | Subject to Loss in Value | Not Bank Deposits | Not Insured by any Federal Government Agency 

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