Trustmark impacted by charge-offs

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Published: August 10,2009

Tags: JACKSON, Trustmark

JACKSON — Trustmark Corporation reports net income available to common shareholders of $13.4 million in the second quarter of 2009, which represented basic earnings per common share of $0.23.

Earnings during the quarter were impacted by a previously announced special FDIC deposit insurance assessment applicable to all insured depository institutions, which reduced Trustmark’s net income by $2.7 million, or $0.05 per share.

During the first six months of 2009, Trustmark’s net income available to common shareholders totaled $36.8 million.

Trustmark continued to conduct extensive reviews of its Florida loan portfolio. Corporate loan review, in conjunction with associates dedicated to special assets in Florida, completed thorough due diligence examinations encompassing 92 percent of the outstanding Florida portfolio. As part of the review, updated financial information on borrowers and guarantors was obtained as well as 160 updated property appraisals.

As a result of this review and appraisal process, $21.2 million in Florida loans were charged-off based upon current property values in the marketplace. Over the last 18 months, the Florida construction and land development portfolio has been reduced by $140.7 million, or 36.4 percent, to $245.5 million. Non-performing assets in Florida declined $5 million in the second quarter relative to the prior quarter. At June 30, 2009, Florida non-impaired construction and land development loans totaled $203.8 million with an associated reserve for loan loss of $25.7 million, or 12.6 percent.

Trustmark’s total net charge-offs were $25.4 million during the second quarter, including Florida net charge-offs of $21.2 million, which represented 83 percent of total net charge-offs. Loan portfolios in the other geographic areas and lines of business continued to perform relatively well in the current economic environment.

Allocation of Trustmark’s $101.8-million allowance for loan losses represented 2.01 percent of commercial loans and 0.73 percent of consumer and home mortgage loans, resulting in an allowance to total loans of 1.55 percent as of June 30, 2009.

In a separate item, Trustmark’s board of directors declared a quarterly cash dividend of $0.23 per common share. The dividend is payable Sept. 15, 2009, to shareholders of record on Sept. 1, 2009.

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