þ
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
|
o
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
|
Mississippi
|
64-0471500
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(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification No.)
|
248
East Capitol Street, Jackson, Mississippi
|
39201
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Large
accelerated filer
þ
|
Accelerated
filer
o
|
||
Non-accelerated
filer
o
(Do not check if
a smaller reporting company)
|
Smaller
reporting company
o
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
September
30,
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September
30,
|
|||||||||||||||
2009
|
2008
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2009
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2008
|
|||||||||||||
Interest
Income
|
||||||||||||||||
Interest
and fees on loans
|
$ | 88,015 | $ | 104,145 | $ | 268,683 | $ | 329,651 | ||||||||
Interest
on securities:
|
||||||||||||||||
Taxable
|
19,524 | 12,117 | 61,622 | 29,053 | ||||||||||||
Tax
exempt
|
1,412 | 1,265 | 3,930 | 3,884 | ||||||||||||
Interest
on federal funds sold and securities purchased under reverse repurchase
agreements
|
16 | 98 | 54 | 445 | ||||||||||||
Other
interest income
|
381 | 407 | 1,037 | 1,454 | ||||||||||||
Total
Interest Income
|
109,348 | 118,032 | 335,326 | 364,487 | ||||||||||||
Interest
Expense
|
||||||||||||||||
Interest
on deposits
|
18,403 | 32,860 | 62,373 | 113,104 | ||||||||||||
Interest
on federal funds purchased and securities sold under repurchase
agreements
|
282 | 3,123 | 918 | 9,215 | ||||||||||||
Other
interest expense
|
1,786 | 2,653 | 6,118 | 10,405 | ||||||||||||
Total
Interest Expense
|
20,471 | 38,636 | 69,409 | 132,724 | ||||||||||||
Net
Interest Income
|
88,877 | 79,396 | 265,917 | 231,763 | ||||||||||||
Provision
for loan losses
|
15,770 | 14,473 | 59,403 | 59,728 | ||||||||||||
Net
Interest Income After Provision for Loan Losses
|
73,107 | 64,923 | 206,514 | 172,035 | ||||||||||||
Noninterest
Income
|
||||||||||||||||
Service
charges on deposit accounts
|
14,157 | 13,886 | 39,969 | 39,673 | ||||||||||||
Insurance
commissions
|
7,894 | 9,007 | 22,688 | 25,657 | ||||||||||||
Wealth
management
|
5,589 | 6,788 | 16,641 | 21,017 | ||||||||||||
General
banking - other
|
5,620 | 5,813 | 17,090 | 17,654 | ||||||||||||
Mortgage
banking, net
|
8,871 | 4,323 | 22,321 | 22,087 | ||||||||||||
Other,
net
|
994 | 2,131 | 3,802 | 12,351 | ||||||||||||
Securities
gains, net
|
1,014 | 2 | 5,448 | 493 | ||||||||||||
Total
Noninterest Income
|
44,139 | 41,950 | 127,959 | 138,932 | ||||||||||||
Noninterest
Expense
|
||||||||||||||||
Salaries
and employee benefits
|
42,629 | 42,859 | 127,043 | 129,214 | ||||||||||||
Services
and fees
|
10,124 | 9,785 | 30,373 | 28,741 | ||||||||||||
Net
occupancy - premises
|
4,862 | 5,153 | 14,988 | 14,804 | ||||||||||||
Equipment
expense
|
4,104 | 4,231 | 12,378 | 12,449 | ||||||||||||
Other
expense
|
17,515 | 10,706 | 47,830 | 26,966 | ||||||||||||
Total
Noninterest Expense
|
79,234 | 72,734 | 232,612 | 212,174 | ||||||||||||
Income
Before Income Taxes
|
38,012 | 34,139 | 101,861 | 98,793 | ||||||||||||
Income
taxes
|
12,502 | 10,785 | 33,291 | 31,708 | ||||||||||||
Net
Income
|
25,510 | 23,354 | 68,570 | 67,085 | ||||||||||||
Preferred
stock dividends
|
2,688 | - | 8,063 | - | ||||||||||||
Accretion
of discount on preferred stock
|
452 | - | 1,335 | - | ||||||||||||
Net
Income Available to Common Shareholders
|
$ | 22,370 | $ | 23,354 | $ | 59,172 | $ | 67,085 | ||||||||
Earnings
Per Common Share
|
||||||||||||||||
Basic
|
$ | 0.39 | $ | 0.41 | $ | 1.03 | $ | 1.17 | ||||||||
Diluted
|
$ | 0.39 | $ | 0.41 | $ | 1.03 | $ | 1.17 | ||||||||
Dividends
Per Common Share
|
$ | 0.23 | $ | 0.23 | $ | 0.69 | $ | 0.69 | ||||||||
See
notes to consolidated financial statements.
|
Trustmark
Corporation and Subsidiaries
|
||||||||
Consolidated
Statements of Changes in Shareholders' Equity
|
||||||||
($
in thousands)
|
||||||||
(Unaudited)
|
||||||||
2009
|
2008
|
|||||||
Balance,
January 1,
|
$ | 1,178,466 | $ | 919,636 | ||||
Net
income per consolidated statements of income
|
68,570 | 67,085 | ||||||
Other
comprehensive income:
|
||||||||
Net
change in fair value of securities available for sale
|
16,622 | (2,688 | ) | |||||
Net
change in defined benefit plans
|
1,167 | 808 | ||||||
Comprehensive
income
|
86,359 | 65,205 | ||||||
Preferred
dividends paid
|
(7,883 | ) | - | |||||
Common
stock dividends paid
|
(39,967 | ) | (39,756 | ) | ||||
Common
stock issued-net, long-term incentive plans
|
428 | 568 | ||||||
Excess
tax benefit from stock-based compensation arrangements
|
545 | 198 | ||||||
Compensation
expense, long-term incentive plans
|
3,413 | 3,147 | ||||||
Balance,
September 30,
|
$ | 1,221,361 | $ | 948,998 |
Securities
Available for Sale
|
Securities
Held to Maturity
|
|||||||||||||||||||||||||||||||
Gross
|
Gross
|
Estimated
|
Gross
|
Gross
|
Estimated
|
|||||||||||||||||||||||||||
Amortized
|
Unrealized
|
Unrealized
|
Fair
|
Amortized
|
Unrealized
|
Unrealized
|
Fair
|
|||||||||||||||||||||||||
September
30, 2009
|
Cost
|
Gains
|
(Losses)
|
Value
|
Cost
|
Gains
|
(Losses)
|
Value
|
||||||||||||||||||||||||
U.S.
Government agency obligations
|
||||||||||||||||||||||||||||||||
Issued
by U.S. Government agencies
|
$ | 21 | $ | - | $ | - | $ | 21 | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||
Issued
by U.S. Government sponsored agencies
|
24,821 | 171 | - | 24,992 | - | - | - | - | ||||||||||||||||||||||||
Obligations
of states and political subdivisions
|
147,633 | 3,933 | (139 | ) | 151,427 | 78,522 | 3,647 | (98 | ) | 82,071 | ||||||||||||||||||||||
Mortgage-backed
securities
|
||||||||||||||||||||||||||||||||
Residential
mortgage pass-through securities
|
||||||||||||||||||||||||||||||||
Guaranteed
by GNMA
|
9,060 | 530 | - | 9,590 | 7,269 | 23 | (18 | ) | 7,274 | |||||||||||||||||||||||
Issued
by FNMA and FHLMC
|
6,864 | 365 | - | 7,229 | - | - | - | - | ||||||||||||||||||||||||
Other
residential mortgage-backed securities
|
||||||||||||||||||||||||||||||||
Issued
or guaranteed by FNMA, FHLMC or GNMA
|
1,209,981 | 48,798 | - | 1,258,779 | 153,728 | 6,547 | - | 160,275 | ||||||||||||||||||||||||
Commercial
mortgage-backed securities
|
||||||||||||||||||||||||||||||||
Issued
or guaranteed by FNMA, FHLMC or GNMA
|
67,448 | 2,911 | - | 70,359 | 3,084 | 49 | (5 | ) | 3,128 | |||||||||||||||||||||||
Corporate
debt securities
|
6,113 | 115 | - | 6,228 | - | - | - | - | ||||||||||||||||||||||||
Total
|
$ | 1,471,941 | $ | 56,823 | $ | (139 | ) | $ | 1,528,625 | $ | 242,603 | $ | 10,266 | $ | (121 | ) | $ | 252,748 | ||||||||||||||
December
31, 2008
|
||||||||||||||||||||||||||||||||
U.S.
Treasury securities
|
$ | 6,502 | $ | 23 | $ | - | $ | 6,525 | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||
U.S.
Government agency obligations
|
||||||||||||||||||||||||||||||||
Issued
by U.S. Government sponsored agencies
|
24,821 | 546 | - | 25,367 | - | - | - | - | ||||||||||||||||||||||||
Obligations
of states and political subdivisions
|
98,323 | 932 | (602 | ) | 98,653 | 102,901 | 2,764 | (524 | ) | 105,141 | ||||||||||||||||||||||
Mortgage-backed
securities
|
||||||||||||||||||||||||||||||||
Residential
mortgage pass-through securities
|
||||||||||||||||||||||||||||||||
Guaranteed
by GNMA
|
8,476 | 272 | (22 | ) | 8,726 | - | - | - | - | |||||||||||||||||||||||
Issued
by FNMA and FHLMC
|
18,519 | 667 | - | 19,186 | - | - | - | - | ||||||||||||||||||||||||
Other
residential mortgage-backed securities
|
||||||||||||||||||||||||||||||||
Issued
or guaranteed by FNMA, FHLMC or GNMA
|
1,337,140 | 27,876 | (1 | ) | 1,365,015 | 156,728 | 2,171 | (1 | ) | 158,898 | ||||||||||||||||||||||
Commercial
mortgage-backed securities
|
||||||||||||||||||||||||||||||||
Issued
or guaranteed by FNMA, FHLMC or GNMA
|
11,041 | 458 | - | 11,499 | - | - | - | - | ||||||||||||||||||||||||
Corporate
debt securities
|
8,254 | - | (384 | ) | 7,870 | - | - | - | - | |||||||||||||||||||||||
Total
|
$ | 1,513,076 | $ | 30,774 | $ | (1,009 | ) | $ | 1,542,841 | $ | 259,629 | $ | 4,935 | $ | (525 | ) | $ | 264,039 |
Less
than 12 Months
|
12
Months or More
|
Total
|
||||||||||||||||||||||
Gross
|
Gross
|
Gross
|
||||||||||||||||||||||
Estimated
|
Unrealized
|
Estimated
|
Unrealized
|
Estimated
|
Unrealized
|
|||||||||||||||||||
September
30, 2009
|
Fair
Value
|
(Losses)
|
Fair
Value
|
(Losses)
|
Fair
Value
|
(Losses)
|
||||||||||||||||||
Obligations
of states and political subdivisions
|
$ | 2,671 | $ | (47 | ) | $ | 6,858 | $ | (190 | ) | $ | 9,529 | $ | (237 | ) | |||||||||
Mortgage-backed
securities
|
||||||||||||||||||||||||
Residential
mortgage pass-through securities
|
||||||||||||||||||||||||
Guaranteed
by GNMA
|
1,970 | (18 | ) | - | - | 1,970 | (18 | ) | ||||||||||||||||
Commercial
mortgage-backed securities
|
||||||||||||||||||||||||
Issued
or guaranteed by FNMA, FHLMC or GNMA
|
772 | (5 | ) | - | - | 772 | (5 | ) | ||||||||||||||||
Total
|
$ | 5,413 | $ | (70 | ) | $ | 6,858 | $ | (190 | ) | $ | 12,271 | $ | (260 | ) | |||||||||
December
31, 2008
|
||||||||||||||||||||||||
Obligations
of states and political subdivisions
|
$ | 10,522 | $ | (675 | ) | $ | 4,057 | $ | (451 | ) | $ | 14,579 | $ | (1,126 | ) | |||||||||
Mortgage-backed
securities
|
||||||||||||||||||||||||
Residential
mortgage pass-through securities
|
||||||||||||||||||||||||
Guaranteed
by GNMA
|
819 | (22 | ) | - | - | 819 | (22 | ) | ||||||||||||||||
Other
residential mortgage-backed securities
|
||||||||||||||||||||||||
Issued
or guaranteed by FNMA, FHLMC or GNMA
|
8 | (1 | ) | 64 | (1 | ) | 72 | (2 | ) | |||||||||||||||
Corporate
debt securities
|
7,870 | (384 | ) | - | - | 7,870 | (384 | ) | ||||||||||||||||
Total
|
$ | 19,219 | $ | (1,082 | ) | $ | 4,121 | $ | (452 | ) | $ | 23,340 | $ | (1,534 | ) |
Three
Months Ended
|
Nine
Months Ended
|
||||||||||||||||
September
30,
|
September
30,
|
||||||||||||||||
Available
for Sale
|
|
2009
|
2008
|
2009
|
2008
|
||||||||||||
Proceeds
from sales of securities
|
$ | 30,572 | $ | 114,942 | $ | 188,460 | $ | 157,949 | |||||||||
Gross
realized gains
|
999 | 86 | 5,379 | 487 | |||||||||||||
Gross
realized (losses)
|
- | (84 | ) | (10 | ) | (84 | ) | ||||||||||
Held
to Maturity
|
|
||||||||||||||||
Proceeds
from calls of securities
|
$ | 3,333 | $ | - | $ | 8,338 | $ | 5,552 | |||||||||
Gross
realized gains
|
15 | - | 79 | 90 |
Securities
|
Securities
|
|||||||||||||||
Available
for Sale
|
Held
to Maturity
|
|||||||||||||||
Estimated
|
Estimated
|
|||||||||||||||
Amortized
|
Fair
|
Amortized
|
Fair
|
|||||||||||||
Cost
|
Value
|
Cost
|
Value
|
|||||||||||||
Due
in one year or less
|
$ | 48,700 | $ | 48,740 | $ | 6,595 | $ | 6,642 | ||||||||
Due
after one year through five years
|
32,265 | 33,368 | 23,076 | 23,717 | ||||||||||||
Due
after five years through ten years
|
73,628 | 75,797 | 34,502 | 36,296 | ||||||||||||
Due
after ten years
|
23,995 | 24,763 | 14,349 | 15,416 | ||||||||||||
178,588 | 182,668 | 78,522 | 82,071 | |||||||||||||
Mortgage-backed
securities
|
1,293,353 | 1,345,957 | 164,081 | 170,677 | ||||||||||||
Total
|
$ | 1,471,941 | $ | 1,528,625 | $ | 242,603 | $ | 252,748 |
September
30,
|
December
31,
|
|||||||
2009
|
2008
|
|||||||
Loans
secured by real estate:
|
||||||||
Construction,
land development and other land loans
|
$ | 872,367 | $ | 1,028,788 | ||||
Secured
by 1-4 family residential properties
|
1,637,322 | 1,524,061 | ||||||
Secured
by nonfarm, nonresidential properties
|
1,472,147 | 1,422,658 | ||||||
Other
real estate secured
|
209,957 | 186,915 | ||||||
Commercial
and industrial loans
|
1,165,970 | 1,305,938 | ||||||
Consumer
loans
|
661,075 | 895,046 | ||||||
Other
loans
|
363,602 | 358,997 | ||||||
Loans
|
6,382,440 | 6,722,403 | ||||||
Less
allowance for loan losses
|
103,016 | 94,922 | ||||||
Net
loans
|
$ | 6,279,424 | $ | 6,627,481 |
Three
Months Ended September 30,
|
Nine
Months Ended September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Beginning
balance
|
$ | 101,751 | $ | 86,576 | $ | 94,922 | $ | 79,851 | ||||||||
Loans
charged-off
|
(18,687 | ) | (12,732 | ) | (60,572 | ) | (56,728 | ) | ||||||||
Recoveries
|
4,182 | 2,571 | 9,263 | 8,037 | ||||||||||||
Net
charge-offs
|
(14,505 | ) | (10,161 | ) | (51,309 | ) | (48,691 | ) | ||||||||
Provision
for loan losses
|
15,770 | 14,473 | 59,403 | 59,728 | ||||||||||||
Balance
at end of period
|
$ | 103,016 | $ | 90,888 | $ | 103,016 | $ | 90,888 |
Nine
Months Ended September 30,
|
||||||||
2009
|
2008
|
|||||||
Balance
at beginning of period
|
$ | 42,882 | $ | 67,192 | ||||
Origination
of servicing assets
|
20,762 | 18,759 | ||||||
Disposals
of mortgage loans sold serviced released
|
(4,151 | ) | (2,524 | ) | ||||
Change
in fair value:
|
||||||||
Due
to market changes
|
3,897 | 2,008 | ||||||
Due
to runoff
|
(7,348 | ) | (6,885 | ) | ||||
Balance
at end of period
|
$ | 56,042 | $ | 78,550 |
September
30,
|
December
31,
|
|||||||
2009
|
2008
|
|||||||
Noninterest-bearing
demand deposits
|
$ | 1,493,424 | $ | 1,496,166 | ||||
Interest-bearing
deposits:
|
||||||||
Interest-bearing
demand
|
1,163,589 | 1,128,426 | ||||||
Savings
|
1,724,797 | 1,658,255 | ||||||
Time
|
2,488,625 | 2,541,023 | ||||||
Total
interest-bearing deposits
|
5,377,011 | 5,327,704 | ||||||
Total
deposits
|
$ | 6,870,435 | $ | 6,823,870 |
Three
months ended September 30,
|
Nine
months ended September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Net
periodic benefit cost (income)
|
||||||||||||||||
Service
cost
|
$ | 98 | $ | 325 | $ | 294 | $ | 1,234 | ||||||||
Interest
cost
|
1,210 | 1,234 | 3,628 | 3,702 | ||||||||||||
Expected
return on plan assets
|
(352 | ) | (1,399 | ) | (4,526 | ) | (4,195 | ) | ||||||||
Amortization
of prior service credits
|
- | (127 | ) | (127 | ) | (382 | ) | |||||||||
Curtailment
gain
|
- | - | (1,886 | ) | - | |||||||||||
Recognized
net actuarial (gain) loss
|
(438 | ) | 552 | 2,154 | 1,394 | |||||||||||
Net
periodic benefit cost (income)
|
$ | 518 | $ | 585 | $ | (463 | ) | $ | 1,753 |
Three
months ended September 30,
|
Nine
months ended September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Net
periodic benefit cost
|
||||||||||||||||
Service
cost
|
$ | 226 | $ | 241 | $ | 678 | $ | 850 | ||||||||
Interest
cost
|
552 | 523 | 1,656 | 1,568 | ||||||||||||
Amortization
of prior service cost
|
37 | 42 | 111 | 111 | ||||||||||||
Recognized
net actuarial loss
|
59 | 90 | 178 | 185 | ||||||||||||
Net
periodic benefit cost
|
$ | 874 | $ | 896 | $ | 2,623 | $ | 2,714 |
Three
Months Ended September 30,
|
Nine
Months Ended September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Basic
shares
|
57,431 | 57,299 | 57,396 | 57,293 | ||||||||||||
Dilutive
shares
|
128 | 39 | 100 | 33 | ||||||||||||
Diluted
shares
|
57,559 | 57,338 | 57,496 | 57,326 |
Nine
Months Ended September 30,
|
||||||||
2009
|
2008
|
|||||||
Income
taxes paid
|
$ | 44,640 | $ | 40,904 | ||||
Interest
expense paid on deposits and borrowings
|
72,280 | 141,640 | ||||||
Noncash
transfers from loans to foreclosed properties
|
53,813 | 30,191 |
Accumulated
|
||||||||||||
Other
|
||||||||||||
Before-Tax
|
Tax
|
Comprehensive
|
||||||||||
Amount
|
Effect
|
Income
(Loss)
|
||||||||||
Balance,
January 1, 2009
|
$ | (23,800 | ) | $ | 9,083 | $ | (14,717 | ) | ||||
Unrealized
holding gains on AFS arising during period
|
32,366 | (12,380 | ) | 19,986 | ||||||||
Adjustment
for net gains realized in net income
|
(5,448 | ) | 2,084 | (3,364 | ) | |||||||
Pension
and other postretirement benefit plans
|
1,890 | (723 | ) | 1,167 | ||||||||
Balance,
September 30, 2009
|
$ | 5,008 | $ | (1,936 | ) | $ | 3,072 | |||||
Balance,
January 1, 2008
|
$ | (23,370 | ) | $ | 8,919 | $ | (14,451 | ) | ||||
Unrealized
holding losses on AFS arising during period
|
(3,859 | ) | 1,476 | (2,383 | ) | |||||||
Adjustment
for net gains realized in net income
|
(493 | ) | 189 | (304 | ) | |||||||
Pension
and other postretirement benefit plans
|
1,307 | (500 | ) | 807 | ||||||||
Balance,
September 30, 2008
|
$ | (26,415 | ) | $ | 10,084 | $ | (16,331 | ) |
Three
Months Ended September 30,
|
Nine
Months Ended September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
FDIC
assessment expense
|
$ | 2,913 | $ | 1,377 | $ | 12,943 | $ | 1,969 | ||||||||
ORE/Foreclosure
expense
|
5,870 | 1,146 | 9,233 | 1,697 | ||||||||||||
Other
expense
|
8,732 | 8,183 | 25,654 | 23,300 | ||||||||||||
Total
other expense
|
$ | 17,515 | $ | 10,706 | $ | 47,830 | $ | 26,966 |
Total
|
Level
1
|
Level
2
|
Level
3
|
|||||||||||||
U.S.
Government agency obligations
|
$ | 25,013 | $ | - | $ | 25,013 | $ | - | ||||||||
Obligations
of states and political subdivisions
|
151,427 | - | 151,427 | - | ||||||||||||
Mortgage-backed
securities
|
1,345,957 | - | 1,345,957 | - | ||||||||||||
Corporate
debt securities
|
6,228 | - | 6,228 | - | ||||||||||||
Securities
available for sale
|
1,528,625 | - | 1,528,625 | - | ||||||||||||
Loans
held for sale
|
237,152 | - | 237,152 | - | ||||||||||||
Mortgage
servicing rights
|
56,042 | - | - | 56,042 | ||||||||||||
Other
assets - derivatives
|
5,157 | 4,402 | - | 755 | ||||||||||||
Other
liabilities - derivatives
|
3,225 | 1,097 | 2,128 | - |
Other
Assets - Derivatives
|
MSR
|
|||||||
Balance,
beginning of period
|
$ | 1,433 | $ | 42,882 | ||||
Total
net gains included in net income
|
5,600 | 16,611 | ||||||
Purchases,
sales, issuances and settlements, net
|
(6,278 | ) | (3,451 | ) | ||||
Balance,
end of period
|
$ | 755 | $ | 56,042 | ||||
The
amount of total (losses) gains for the period included in earnings that
are attributable
to
the change in unrealized gains or losses still held at September 30,
2009
|
$ | (600 | ) | $ | 3,897 |
September
30, 2009
|
December
31, 2008
|
|||||||||||||||
Carrying
|
Estimated
|
Carrying
|
Estimated
|
|||||||||||||
Value
|
Fair
Value
|
Value
|
Fair
Value
|
|||||||||||||
Financial
Assets:
|
||||||||||||||||
Cash
and short-term investments
|
$ | 200,000 | $ | 200,000 | $ | 281,331 | $ | 281,331 | ||||||||
Securities
available for sale
|
1,528,625 | 1,528,625 | 1,542,841 | 1,542,841 | ||||||||||||
Securities
held to maturity
|
242,603 | 252,748 | 259,629 | 264,039 | ||||||||||||
Loans
held for sale
|
237,152 | 237,152 | 238,265 | 238,265 | ||||||||||||
Net
loans
|
6,279,424 | 6,323,453 | 6,627,481 | 6,718,049 | ||||||||||||
Other
assets - derivatives
|
5,157 | 5,157 | 12,504 | 12,504 | ||||||||||||
Financial
Liabilities:
|
||||||||||||||||
Deposits
|
6,870,435 | 6,882,087 | 6,823,870 | 6,831,950 | ||||||||||||
Short-term
liabilities
|
960,162 | 960,162 | 1,542,087 | 1,542,087 | ||||||||||||
Long-term
FHLB advances
|
75,000 | 75,000 | - | - | ||||||||||||
Subordinated
notes
|
49,766 | 48,895 | 49,741 | 39,765 | ||||||||||||
Junior
subordinated debt securities
|
70,104 | 31,731 | 70,104 | 24,969 | ||||||||||||
Other
liabilities - derivatives
|
3,225 | 3,225 | 7,367 | 7,367 |
Fair
Value of Derivative Instruments
|
||||||||||
($
in thousands)
|
September
30, 2009
|
|||||||||
Asset
Derivatives
|
Liability
Derivatives
|
|||||||||
Balance
Sheet Location
|
Fair
Value
|
Balance
Sheet Location
|
Fair
Value
|
|||||||
Derivatives
designated as
|
||||||||||
hedging
instruments under
|
||||||||||
FASB
ASC Topic 815
|
||||||||||
Interest
rate contracts:
|
||||||||||
Forward
contracts
|
Other
liabilities
|
$ | 2,128,000 | |||||||
Total
|
$ | 2,128,000 | ||||||||
Derivatives
not designated
|
||||||||||
as
hedging instruments under
|
||||||||||
FASB
ASC Topic 815
|
||||||||||
Interest
rate contracts:
|
||||||||||
Futures
contracts
|
Other
assets
|
$ | 3,531,000 | |||||||
Exchange
traded purchased options
|
Other
assets
|
871,000 | ||||||||
OTC
written options (rate locks)
|
Other
assets
|
755,000 | ||||||||
Exchange
traded written options
|
Other
liabilities
|
$ | 1,097,000 | |||||||
Total
|
$ | 5,157,000 | $ | 1,097,000 |
Three
Months Ended September 30,
|
Nine
Months Ended September 30,
|
|||||||||||||||||||||||||||||||
2009
|
2008
|
$
Change
|
%
Change
|
2009
|
2008
|
$
Change
|
%
Change
|
|||||||||||||||||||||||||
General
Banking
|
||||||||||||||||||||||||||||||||
Net
interest income
|
$ | 87,757 | $ | 78,330 | $ | 9,427 | 12.0 | % | $ | 262,637 | $ | 228,594 | $ | 34,043 | 14.9 | % | ||||||||||||||||
Provision
for loan losses
|
15,739 | 14,479 | 1,260 | 8.7 | % | 59,367 | 59,746 | (379 | ) | -0.6 | % | |||||||||||||||||||||
Noninterest
income
|
30,548 | 25,527 | 5,021 | 19.7 | % | 88,181 | 91,305 | (3,124 | ) | -3.4 | % | |||||||||||||||||||||
Noninterest
expense
|
68,490 | 61,166 | 7,324 | 12.0 | % | 200,490 | 178,118 | 22,372 | 12.6 | % | ||||||||||||||||||||||
Income
before income taxes
|
34,076 | 28,212 | 5,864 | 20.8 | % | 90,961 | 82,035 | 8,926 | 10.9 | % | ||||||||||||||||||||||
Income
taxes
|
11,089 | 8,621 | 2,468 | 28.6 | % | 29,351 | 25,568 | 3,783 | 14.8 | % | ||||||||||||||||||||||
General
banking net income
|
$ | 22,987 | $ | 19,591 | $ | 3,396 | 17.3 | % | $ | 61,610 | $ | 56,467 | $ | 5,143 | 9.1 | % | ||||||||||||||||
Selected
Financial Information
|
||||||||||||||||||||||||||||||||
Average
assets
|
$ | 9,323,187 | $ | 8,947,560 | $ | 375,627 | 4.2 | % | $ | 9,489,689 | $ | 8,915,183 | $ | 574,506 | 6.4 | % | ||||||||||||||||
Depreciation
and amortization
|
$ | 5,966 | $ | 6,486 | $ | (520 | ) | -8.0 | % | $ | 20,103 | $ | 19,791 | $ | 312 | 1.6 | % | |||||||||||||||
Wealth
Management
|
||||||||||||||||||||||||||||||||
Net
interest income
|
$ | 1,032 | $ | 970 | $ | 62 | 6.4 | % | $ | 3,039 | $ | 3,025 | $ | 14 | 0.5 | % | ||||||||||||||||
Provision
for loan losses
|
31 | (6 | ) | 37 | n/m | 36 | (18 | ) | 54 | n/m | ||||||||||||||||||||||
Noninterest
income
|
5,701 | 7,202 | (1,501 | ) | -20.8 | % | 17,099 | 21,800 | (4,701 | ) | -21.6 | % | ||||||||||||||||||||
Noninterest
expense
|
4,904 | 5,232 | (328 | ) | -6.3 | % | 14,918 | 15,825 | (907 | ) | -5.7 | % | ||||||||||||||||||||
Income
before income taxes
|
1,798 | 2,946 | (1,148 | ) | -39.0 | % | 5,184 | 9,018 | (3,834 | ) | -42.5 | % | ||||||||||||||||||||
Income
taxes
|
630 | 1,051 | (421 | ) | -40.1 | % | 1,841 | 3,200 | (1,359 | ) | -42.5 | % | ||||||||||||||||||||
Wealth
management net income
|
$ | 1,168 | $ | 1,895 | $ | (727 | ) | -38.4 | % | $ | 3,343 | $ | 5,818 | $ | (2,475 | ) | -42.5 | % | ||||||||||||||
Selected
Financial Information
|
||||||||||||||||||||||||||||||||
Average
assets
|
$ | 94,841 | $ | 99,497 | $ | (4,656 | ) | -4.7 | % | $ | 96,754 | $ | 97,032 | $ | (278 | ) | -0.3 | % | ||||||||||||||
Depreciation
and amortization
|
$ | 75 | $ | 83 | $ | (8 | ) | -9.6 | % | $ | 222 | $ | 249 | $ | (27 | ) | -10.8 | % | ||||||||||||||
Insurance
|
||||||||||||||||||||||||||||||||
Net
interest income
|
$ | 88 | $ | 96 | $ | (8 | ) | -8.3 | % | $ | 241 | $ | 144 | $ | 97 | 67.4 | % | |||||||||||||||
Provision
for loan losses
|
- | - | - | n/m | - | - | - | n/m | ||||||||||||||||||||||||
Noninterest
income
|
7,890 | 9,221 | (1,331 | ) | -14.4 | % | 22,679 | 25,827 | (3,148 | ) | -12.2 | % | ||||||||||||||||||||
Noninterest
expense
|
5,840 | 6,336 | (496 | ) | -7.8 | % | 17,204 | 18,231 | (1,027 | ) | -5.6 | % | ||||||||||||||||||||
Income
before income taxes
|
2,138 | 2,981 | (843 | ) | -28.3 | % | 5,716 | 7,740 | (2,024 | ) | -26.1 | % | ||||||||||||||||||||
Income
taxes
|
783 | 1,113 | (330 | ) | -29.6 | % | 2,099 | 2,940 | (841 | ) | -28.6 | % | ||||||||||||||||||||
Insurance
net income
|
$ | 1,355 | $ | 1,868 | $ | (513 | ) | -27.5 | % | $ | 3,617 | $ | 4,800 | $ | (1,183 | ) | -24.6 | % | ||||||||||||||
Selected
Financial Information
|
||||||||||||||||||||||||||||||||
Average
assets
|
$ | 20,413 | $ | 25,077 | $ | (4,664 | ) | -18.6 | % | $ | 18,581 | $ | 20,796 | $ | (2,215 | ) | -10.7 | % | ||||||||||||||
Depreciation
and amortization
|
$ | 117 | $ | 114 | $ | 3 | 2.6 | % | $ | 337 | $ | 319 | $ | 18 | 5.6 | % | ||||||||||||||||
Consolidated
|
||||||||||||||||||||||||||||||||
Net
interest income
|
$ | 88,877 | $ | 79,396 | $ | 9,481 | 11.9 | % | $ | 265,917 | $ | 231,763 | $ | 34,154 | 14.7 | % | ||||||||||||||||
Provision
for loan losses
|
15,770 | 14,473 | 1,297 | 9.0 | % | 59,403 | 59,728 | (325 | ) | -0.5 | % | |||||||||||||||||||||
Noninterest
income
|
44,139 | 41,950 | 2,189 | 5.2 | % | 127,959 | 138,932 | (10,973 | ) | -7.9 | % | |||||||||||||||||||||
Noninterest
expense
|
79,234 | 72,734 | 6,500 | 8.9 | % | 232,612 | 212,174 | 20,438 | 9.6 | % | ||||||||||||||||||||||
Income
before income taxes
|
38,012 | 34,139 | 3,873 | 11.3 | % | 101,861 | 98,793 | 3,068 | 3.1 | % | ||||||||||||||||||||||
Income
taxes
|
12,502 | 10,785 | 1,717 | 15.9 | % | 33,291 | 31,708 | 1,583 | 5.0 | % | ||||||||||||||||||||||
Consolidated
net income
|
$ | 25,510 | $ | 23,354 | $ | 2,156 | 9.2 | % | $ | 68,570 | $ | 67,085 | $ | 1,485 | 2.2 | % | ||||||||||||||||
Selected
Financial Information
|
||||||||||||||||||||||||||||||||
Average
assets
|
$ | 9,438,441 | $ | 9,072,134 | $ | 366,307 | 4.0 | % | $ | 9,605,024 | $ | 9,033,011 | $ | 572,013 | 6.3 | % | ||||||||||||||||
Depreciation
and amortization
|
$ | 6,158 | $ | 6,683 | $ | (525 | ) | -7.9 | % | $ | 20,662 | $ | 20,359 | $ | 303 | 1.5 | % | |||||||||||||||
n/m
- percentage changes +/- 100% are considered not
meaningful
|
Three
Months Ended September 30,
|
Nine
Months Ended September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Consolidated
Statements of Income
|
||||||||||||||||
Total
interest income
|
$ | 109,348 | $ | 118,032 | $ | 335,326 | $ | 364,487 | ||||||||
Total
interest expense
|
20,471 | 38,636 | 69,409 | 132,724 | ||||||||||||
Net
interest income
|
88,877 | 79,396 | 265,917 | 231,763 | ||||||||||||
Provision
for loan losses
|
15,770 | 14,473 | 59,403 | 59,728 | ||||||||||||
Noninterest
income
|
44,139 | 41,950 | 127,959 | 138,932 | ||||||||||||
Noninterest
expense
|
79,234 | 72,734 | 232,612 | 212,174 | ||||||||||||
Income
before income taxes
|
38,012 | 34,139 | 101,861 | 98,793 | ||||||||||||
Income
taxes
|
12,502 | 10,785 | 33,291 | 31,708 | ||||||||||||
Net
Income
|
25,510 | 23,354 | 68,570 | 67,085 | ||||||||||||
Preferred
stock dividend/discount accretion
|
3,140 | - | 9,398 | - | ||||||||||||
Net
Income Available to Common Shareholders
|
$ | 22,370 | $ | 23,354 | $ | 59,172 | $ | 67,085 | ||||||||
Common
Share Data
|
||||||||||||||||
Basic
earnings per share
|
$ | 0.39 | $ | 0.41 | $ | 1.03 | $ | 1.17 | ||||||||
Diluted
earnings per share
|
0.39 | 0.41 | 1.03 | 1.17 | ||||||||||||
Cash
dividends per share
|
0.23 | 0.23 | 0.69 | 0.69 | ||||||||||||
Performance
Ratios
|
||||||||||||||||
Return
on common equity
|
8.78 | % | 9.81 | % | 7.91 | % | 9.52 | % | ||||||||
Return
on average tangible common equity
|
13.06 | % | 15.16 | % | 11.89 | % | 14.80 | % | ||||||||
Return
on equity
|
8.32 | % | 9.81 | % | 7.60 | % | 9.52 | % | ||||||||
Return
on assets
|
1.07 | % | 1.02 | % | 0.95 | % | 0.99 | % | ||||||||
Credit
Quality Ratios
|
||||||||||||||||
Net
charge offs/average loans
|
0.86 | % | 0.58 | % | 1.00 | % | 0.92 | % | ||||||||
Provision
for loan losses/average loans
|
0.93 | % | 0.83 | % | 1.16 | % | 1.13 | % | ||||||||
Nonperforming
loans/total loans (incl LHFS)
|
2.09 | % | 1.53 | % | 2.09 | % | 1.53 | % | ||||||||
Nonperforming
assets/total loans (incl LHFS) + ORE
|
3.14 | % | 1.99 | % | 3.14 | % | 1.99 | % | ||||||||
ALL/total
loans (excl LHFS)
|
1.61 | % | 1.35 | % | 1.61 | % | 1.35 | % | ||||||||
Capital
Ratios
|
||||||||||||||||
Total
equity/total assets
|
13.04 | % | 10.44 | % | ||||||||||||
Common
equity/total assets
|
10.83 | % | 10.44 | % | ||||||||||||
Tangible
equity/tangible assets
|
10.04 | % | 7.22 | % | ||||||||||||
Tangible
common equity/tangible assets
|
7.76 | % | 7.22 | % | ||||||||||||
Tangible
common equity/risk-weighted assets
|
10.15 | % | 8.80 | % | ||||||||||||
Tier
1 leverage ratio
|
10.70 | % | 8.11 | % | ||||||||||||
Tier
1 common risk-based capital ratio
|
10.15 | % | 8.91 | % | ||||||||||||
Tier
1 risk-based capital ratio
|
14.11 | % | 9.86 | % | ||||||||||||
Total
risk-based capital ratio
|
16.09 | % | 11.80 | % |
Reconciliation
to GAAP Financial Measures
|
|||||||||||||||||
($
in thousands)
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
9/30/2009
|
9/30/2008
|
9/30/2009
|
9/30/2008
|
||||||||||||||
TANGIBLE
COMMON EQUITY
|
|||||||||||||||||
AVERAGE
BALANCES
|
|||||||||||||||||
Total
shareholders' equity
|
$ | 1,216,987 | $ | 946,897 | $ | 1,205,619 | $ | 941,188 | |||||||||
Less:
Preferred stock
|
(206,308 | ) | - | (205,865 | ) | - | |||||||||||
Total
average common equity
|
1,010,679 | 946,897 | 999,754 | 941,188 | |||||||||||||
Less:
Goodwill
|
(291,104 | ) | (291,145 | ) | (291,104 | ) | (291,162 | ) | |||||||||
Identifiable intangible assets
|
(21,430 | ) | (25,540 | ) | (22,424 | ) | (26,608 | ) | |||||||||
Total
average tangible common equity
|
$ | 698,145 | $ | 630,212 | $ | 686,226 | $ | 623,418 | |||||||||
PERIOD
END BALANCES
|
9/30/2009
|
9/30/2008
|
|||||||||||||||
Total
shareholders' equity
|
$ | 1,221,361 | $ | 948,998 | |||||||||||||
Less:
Preferred stock
|
(206,461 | ) | - | ||||||||||||||
Total
common equity
|
1,014,900 | 948,998 | |||||||||||||||
Less:
Goodwill
|
(291,104 | ) | (291,145 | ) | |||||||||||||
Identifiable intangible assets
|
(20,819 | ) | (24,887 | ) | |||||||||||||
Total
tangible common equity
|
(a)
|
$ | 702,977 | $ | 632,966 | ||||||||||||
TANGIBLE
ASSETS
|
|||||||||||||||||
Total
assets
|
$ | 9,368,498 | $ | 9,086,273 | |||||||||||||
Less:
Goodwill
|
(291,104 | ) | (291,145 | ) | |||||||||||||
Identifiable intangible assets
|
(20,819 | ) | (24,887 | ) | |||||||||||||
Total
tangible assets
|
(b)
|
$ | 9,056,575 | $ | 8,770,241 | ||||||||||||
Risk-weighted
assets
|
(c)
|
$ | 6,923,907 | $ | 7,196,685 | ||||||||||||
Reconciliation
to GAAP Financial Measures (continued)
|
|||||||||||||||||
($
in thousands)
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
9/30/2009
|
9/30/2008
|
9/30/2009
|
9/30/2008
|
||||||||||||||
NET
INCOME ADJUSTED FOR INTANGIBLE AMORTIZATION
|
|||||||||||||||||
Net
income available to common shareholders
|
$ | 22,370 | $ | 23,354 | $ | 59,172 | $ | 67,085 | |||||||||
Plus: Intangible
amortization net of tax
|
619 | 662 | 1,855 | 1,986 | |||||||||||||
Net
income adjusted for intangible amortization
|
$ | 22,989 | $ | 24,016 | $ | 61,027 | $ | 69,071 | |||||||||
Period
end common shares outstanding
|
(d)
|
57,440,047 | 57,324,627 | ||||||||||||||
TANGIBLE
COMMON EQUITY MEASUREMENTS
|
|||||||||||||||||
Return
on average tangible common equity
1
|
13.06 | % | 15.16 | % | 11.89 | % | 14.80 | % | |||||||||
Tangible
common equity/tangible assets
|
(a)/(b)
|
7.76 | % | 7.22 | % | ||||||||||||
Tangible
common equity/risk-weighted assets
|
(a)/(c)
|
10.15 | % | 8.80 | % | ||||||||||||
Tangible
common book value
|
(a)/(d)*1,000
|
$ | 12.24 | $ | 11.04 | ||||||||||||
TIER
1 COMMON RISK-BASED CAPITAL
|
|||||||||||||||||
Total
shareholders' equity
|
$ | 1,221,361 | $ | 948,998 | |||||||||||||
Eliminate
qualifying AOCI
|
(3,072 | ) | 16,331 | ||||||||||||||
Qualifying
tier 1 capital
|
68,000 | 68,000 | |||||||||||||||
Disallowed
goodwill
|
(291,104 | ) | (291,145 | ) | |||||||||||||
Adjustment
to goodwill allowed for deferred taxes
|
8,453 | - | |||||||||||||||
Other
disallowed intangibles
|
(20,819 | ) | (24,887 | ) | |||||||||||||
Disallowed
servicing intangible
|
(5,604 | ) | (7,855 | ) | |||||||||||||
Total
tier 1 capital
|
$ | 977,215 | $ | 709,442 | |||||||||||||
Less: Qualifying
tier 1 capital
|
(68,000 | ) | (68,000 | ) | |||||||||||||
Preferred
stock
|
(206,461 | ) | - | ||||||||||||||
Total
tier 1 common capital
|
(e)
|
$ | 702,754 | $ | 641,442 | ||||||||||||
Tier
1 common risk-based capital ratio
|
(e)/(c)
|
10.15 | % | 8.91 | % |
Yield/Rate
Analysis Table
|
||||||||||||||||||||||||
($
in thousands)
|
||||||||||||||||||||||||
Three Months Ended September
30,
|
||||||||||||||||||||||||
2009
|
2008
|
|||||||||||||||||||||||
Average
|
Yield/
|
Average
|
Yield/
|
|||||||||||||||||||||
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
|||||||||||||||||||
Assets
|
||||||||||||||||||||||||
Interest-earning
assets:
|
||||||||||||||||||||||||
Federal
funds sold and securities purchased under reverse repurchase
agreements
|
$ | 12,821 | $ | 16 | 0.50 | % | $ | 17,401 | $ | 98 | 2.24 | % | ||||||||||||
Securities
- taxable
|
1,569,252 | 19,524 | 4.94 | % | 1,006,996 | 12,117 | 4.79 | % | ||||||||||||||||
Securities
- nontaxable
|
144,699 | 2,172 | 5.96 | % | 114,823 | 1,946 | 6.74 | % | ||||||||||||||||
Loans
(including loans held for sale)
|
6,693,482 | 89,672 | 5.32 | % | 6,927,270 | 105,706 | 6.07 | % | ||||||||||||||||
Other
earning assets
|
43,894 | 381 | 3.44 | % | 37,323 | 407 | 4.34 | % | ||||||||||||||||
Total
interest-earning assets
|
8,464,148 | 111,765 | 5.24 | % | 8,103,813 | 120,274 | 5.90 | % | ||||||||||||||||
Cash
and due from banks
|
205,361 | 246,515 | ||||||||||||||||||||||
Other
assets
|
871,477 | 810,449 | ||||||||||||||||||||||
Allowance
for loan losses
|
(102,545 | ) | (88,643 | ) | ||||||||||||||||||||
Total
Assets
|
$ | 9,438,441 | $ | 9,072,134 | ||||||||||||||||||||
Liabilities
and Shareholders' Equity
|
||||||||||||||||||||||||
Interest-bearing
liabilities:
|
||||||||||||||||||||||||
Interest-bearing
deposits
|
$ | 5,475,486 | 18,403 | 1.33 | % | $ | 5,637,582 | 32,860 | 2.32 | % | ||||||||||||||
Federal
funds purchased and securities sold under repurchase
agreements
|
644,012 | 282 | 0.17 | % | 659,312 | 3,123 | 1.88 | % | ||||||||||||||||
Other
borrowings
|
458,755 | 1,786 | 1.54 | % | 276,712 | 2,653 | 3.81 | % | ||||||||||||||||
Total
interest-bearing liabilities
|
6,578,253 | 20,471 | 1.23 | % | 6,573,606 | 38,636 | 2.34 | % | ||||||||||||||||
Noninterest-bearing
demand deposits
|
1,529,381 | 1,415,402 | ||||||||||||||||||||||
Other
liabilities
|
113,820 | 136,229 | ||||||||||||||||||||||
Shareholders'
equity
|
1,216,987 | 946,897 | ||||||||||||||||||||||
Total
Liabilities and
|
||||||||||||||||||||||||
Shareholders'
Equity
|
$ | 9,438,441 | $ | 9,072,134 | ||||||||||||||||||||
Net
Interest Margin
|
91,294 | 4.28 | % | 81,638 | 4.01 | % | ||||||||||||||||||
Less
tax equivalent adjustment
|
2,417 | 2,242 | ||||||||||||||||||||||
Net
Interest Margin per
|
||||||||||||||||||||||||
Consolidated
Statements of Income
|
$ | 88,877 | $ | 79,396 |
Yield/Rate
Analysis Table
|
||||||||||||||||||||||||
($
in thousands)
|
||||||||||||||||||||||||
Nine
Months Ended September 30,
|
||||||||||||||||||||||||
2009
|
2008
|
|||||||||||||||||||||||
Average
|
Yield/
|
Average
|
Yield/
|
|||||||||||||||||||||
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
|||||||||||||||||||
Assets
|
||||||||||||||||||||||||
Interest-earning
assets:
|
||||||||||||||||||||||||
Federal
funds sold and securities purchased under reverse repurchase
agreements
|
$ | 16,582 | $ | 54 | 0.44 | % | $ | 23,607 | $ | 445 | 2.52 | % | ||||||||||||
Securities
- taxable
|
1,613,707 | 61,622 | 5.11 | % | 835,800 | 29,053 | 4.64 | % | ||||||||||||||||
Securities
- nontaxable
|
129,047 | 6,046 | 6.26 | % | 115,143 | 5,975 | 6.93 | % | ||||||||||||||||
Loans
(including loans held for sale)
|
6,851,047 | 273,706 | 5.34 | % | 7,061,176 | 334,370 | 6.33 | % | ||||||||||||||||
Other
earning assets
|
43,833 | 1,037 | 3.16 | % | 38,583 | 1,454 | 5.03 | % | ||||||||||||||||
Total
interest-earning assets
|
8,654,216 | 342,465 | 5.29 | % | 8,074,309 | 371,297 | 6.14 | % | ||||||||||||||||
Cash
and due from banks
|
219,709 | 253,127 | ||||||||||||||||||||||
Other
assets
|
833,456 | 789,792 | ||||||||||||||||||||||
Allowance
for loan losses
|
(102,357 | ) | (84,217 | ) | ||||||||||||||||||||
Total
Assets
|
$ | 9,605,024 | $ | 9,033,011 | ||||||||||||||||||||
Liabilities
and Shareholders' Equity
|
||||||||||||||||||||||||
Interest-bearing
liabilities:
|
||||||||||||||||||||||||
Interest-bearing
deposits
|
$ | 5,520,250 | 62,373 | 1.51 | % | $ | 5,660,264 | 113,104 | 2.67 | % | ||||||||||||||
Federal
funds purchased and securities sold under repurchase
agreements
|
635,799 | 918 | 0.19 | % | 565,304 | 9,215 | 2.18 | % | ||||||||||||||||
Other
borrowings
|
605,392 | 6,118 | 1.35 | % | 323,616 | 10,405 | 4.29 | % | ||||||||||||||||
Total
interest-bearing liabilities
|
6,761,441 | 69,409 | 1.37 | % | 6,549,184 | 132,724 | 2.71 | % | ||||||||||||||||
Noninterest-bearing
demand deposits
|
1,518,496 | 1,405,244 | ||||||||||||||||||||||
Other
liabilities
|
119,468 | 137,395 | ||||||||||||||||||||||
Shareholders'
equity
|
1,205,619 | 941,188 | ||||||||||||||||||||||
Total
Liabilities and
|
||||||||||||||||||||||||
Shareholders'
Equity
|
$ | 9,605,024 | $ | 9,033,011 | ||||||||||||||||||||
Net
Interest Margin
|
273,056 | 4.22 | % | 238,573 | 3.95 | % | ||||||||||||||||||
Less
tax equivalent adjustment
|
7,139 | 6,810 | ||||||||||||||||||||||
Net
Interest Margin per
|
||||||||||||||||||||||||
Consolidated
Statements of Income
|
$ | 265,917 | $ | 231,763 |
Provision
for Loan Losses
|
||||||||||||||||
($
in thousands)
|
Three
Months Ended September 30,
|
Nine
Months Ended September 30,
|
||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Florida
|
$ | (3,295 | ) | $ | 3,167 | $ | 36,353 | $ | 36,869 | |||||||
Mississippi
(1)
|
12,009 | 8,476 | 15,351 | 14,950 | ||||||||||||
Tennessee
(2)
|
159 | 27 | 1,121 | 3,246 | ||||||||||||
Texas
|
6,897 | 2,803 | 6,578 | 4,663 | ||||||||||||
Total
provision for loan losses
|
$ | 15,770 | $ | 14,473 | $ | 59,403 | $ | 59,728 |
Noninterest
Income
|
||||||||||||||||||||||||||||||||
($
in thousands)
|
||||||||||||||||||||||||||||||||
Three
Months Ended September 30,
|
Nine
Months Ended September 30,
|
|||||||||||||||||||||||||||||||
2009
|
2008
|
$
Change
|
%
Change
|
2009
|
2008
|
$
Change
|
%
Change
|
|||||||||||||||||||||||||
Service
charges on deposit accounts
|
$ | 14,157 | $ | 13,886 | $ | 271 | 2.0 | % | $ | 39,969 | $ | 39,673 | $ | 296 | 0.7 | % | ||||||||||||||||
Insurance
commissions
|
7,894 | 9,007 | (1,113 | ) | -12.4 | % | 22,688 | 25,657 | (2,969 | ) | -11.6 | % | ||||||||||||||||||||
Wealth
management
|
5,589 | 6,788 | (1,199 | ) | -17.7 | % | 16,641 | 21,017 | (4,376 | ) | -20.8 | % | ||||||||||||||||||||
General
banking-other
|
5,620 | 5,813 | (193 | ) | -3.3 | % | 17,090 | 17,654 | (564 | ) | -3.2 | % | ||||||||||||||||||||
Mortgage
banking, net
|
8,871 | 4,323 | 4,548 | n/m | 22,321 | 22,087 | 234 | 1.1 | % | |||||||||||||||||||||||
Other,
net
|
994 | 2,131 | (1,137 | ) | -53.4 | % | 3,802 | 12,351 | (8,549 | ) | -69.2 | % | ||||||||||||||||||||
Total
noninterest income before securities gains, net
|
43,125 | 41,948 | 1,177 | 2.8 | % | 122,511 | 138,439 | (15,928 | ) | -11.5 | % | |||||||||||||||||||||
Securities
gains, net
|
1,014 | 2 | 1,012 | n/m | 5,448 | 493 | 4,955 | n/m | ||||||||||||||||||||||||
Total
noninterest income
|
$ | 44,139 | $ | 41,950 | $ | 2,189 | 5.2 | % | $ | 127,959 | $ | 138,932 | $ | (10,973 | ) | -7.9 | % | |||||||||||||||
n/m
- percentage changes greater than +/- 100% are not considered
meaningful
|
Securities Portfolio by Credit
Rating
(1)
|
||||||||||||||||
($
in thousands)
|
||||||||||||||||
September
30, 2009
|
||||||||||||||||
Amortized
Cost
|
Estimated
Fair Value
|
|||||||||||||||
Amount
|
%
|
Amount
|
%
|
|||||||||||||
Securities
Available for Sale
|
||||||||||||||||
AAA
|
$ | 1,318,189 | 89.6 | % | $ | 1,370,969 | 89.7 | % | ||||||||
Aa1
to Aa3
|
67,682 | 4.6 | % | 68,628 | 4.5 | % | ||||||||||
A1
to A3
|
18,784 | 1.3 | % | 19,236 | 1.3 | % | ||||||||||
Baa1
to Baa3
|
7,186 | 0.5 | % | 7,350 | 0.5 | % | ||||||||||
Not
Rated (2)
|
60,100 | 4.0 | % | 62,442 | 4.0 | % | ||||||||||
Total
securities available for sale
|
$ | 1,471,941 | 100.0 | % | $ | 1,528,625 | 100.0 | % | ||||||||
Securities
Held to Maturity
|
||||||||||||||||
AAA
|
$ | 166,950 | 68.8 | % | $ | 173,657 | 68.7 | % | ||||||||
Aa1
to Aa3
|
22,325 | 9.2 | % | 24,236 | 9.6 | % | ||||||||||
A1
to A3
|
18,121 | 7.5 | % | 18,630 | 7.4 | % | ||||||||||
Baa1
to Baa3
|
3,078 | 1.3 | % | 3,160 | 1.3 | % | ||||||||||
Not
Rated (2)
|
32,129 | 13.2 | % | 33,065 | 13.0 | % | ||||||||||
Total
securities held to maturity
|
$ | 242,603 | 100.0 | % | $ | 252,748 | 100.0 | % |
Loan
Portfolio by Type
|
9/30/2009
|
12/31/2008
|
$
Change
|
%
Change
|
||||||||||||
($
in thousands)
|
||||||||||||||||
Loans
secured by real estate:
|
||||||||||||||||
Construction,
land development and other land loans
|
$ | 872,367 | $ | 1,028,788 | $ | (156,421 | ) | -15.2 | % | |||||||
Secured
by 1-4 family residential properties
|
1,637,322 | 1,524,061 | 113,261 | 7.4 | % | |||||||||||
Secured
by nonfarm, nonresidential properties
|
1,472,147 | 1,422,658 | 49,489 | 3.5 | % | |||||||||||
Other
real estate secured
|
209,957 | 186,915 | 23,042 | 12.3 | % | |||||||||||
Commercial
and industrial loans
|
1,165,970 | 1,305,938 | (139,968 | ) | -10.7 | % | ||||||||||
Consumer
loans
|
661,075 | 895,046 | (233,971 | ) | -26.1 | % | ||||||||||
Other
loans
|
363,602 | 358,997 | 4,605 | 1.3 | % | |||||||||||
Loans
|
6,382,440 | 6,722,403 | (339,963 | ) | -5.1 | % | ||||||||||
Allowance
for loan losses
|
(103,016 | ) | (94,922 | ) | (8,094 | ) | 8.5 | % | ||||||||
Net
Loans
|
$ | 6,279,424 | $ | 6,627,481 | $ | (348,057 | ) | -5.3 | % |
September
30, 2009
|
||||||||||||||||||||
Loan
Composition by Region
|
Total
|
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
|
$ | 872,367 | $ | 211,974 | $ | 321,954 | $ | 61,780 | $ | 276,659 | ||||||||||
Secured
by 1-4 family residential properties
|
1,637,322 | 92,088 | 1,345,249 | 167,852 | 32,133 | |||||||||||||||
Secured
by nonfarm, nonresidential properties
|
1,472,147 | 182,548 | 830,698 | 215,714 | 243,187 | |||||||||||||||
Other
real estate secured
|
209,957 | 12,891 | 168,679 | 9,869 | 18,518 | |||||||||||||||
Commercial
and industrial loans
|
1,165,970 | 19,762 | 836,231 | 60,117 | 249,860 | |||||||||||||||
Consumer
loans
|
661,075 | 2,276 | 619,645 | 29,362 | 9,792 | |||||||||||||||
Other
loans
|
363,602 | 29,880 | 289,894 | 22,921 | 20,907 | |||||||||||||||
Loans
|
$ | 6,382,440 | $ | 551,419 | $ | 4,412,350 | $ | 567,615 | $ | 851,056 | ||||||||||
Construction,
Land Development and Other Land Loans by Region
|
||||||||||||||||||||
Lots
|
$ | 104,966 | $ | 63,645 | $ | 24,816 | $ | 4,535 | $ | 11,970 | ||||||||||
Development
|
199,194 | 28,376 | 77,320 | 11,129 | 82,369 | |||||||||||||||
Unimproved
land
|
280,701 | 83,437 | 107,037 | 32,352 | 57,875 | |||||||||||||||
1-4
family construction
|
137,477 | 13,237 | 77,555 | 6,398 | 40,287 | |||||||||||||||
Other
construction
|
150,029 | 23,279 | 35,226 | 7,366 | 84,158 | |||||||||||||||
Construction,
land development and other land loans
|
$ | 872,367 | $ | 211,974 | $ | 321,954 | $ | 61,780 | $ | 276,659 |
Nonperforming
Assets
|
||||||||
($
in thousands)
|
||||||||
September
30,
2009
|
December 31,
2008
|
|||||||
Nonaccrual
loans
|
||||||||
Florida
|
$ | 72,063 | $ | 75,092 | ||||
Mississippi
(1)
|
28,470 | 18,703 | ||||||
Tennessee
(2)
|
11,481 | 3,638 | ||||||
Texas
|
26,490 | 16,605 | ||||||
Total
nonaccrual loans
|
138,504 | 114,038 | ||||||
Other
real estate
|
||||||||
Florida
|
34,030 | 21,265 | ||||||
Mississippi
(1)
|
22,932 | 6,113 | ||||||
Tennessee
(2)
|
9,809 | 8,862 | ||||||
Texas
|
4,918 | 2,326 | ||||||
Total
other real estate
|
71,689 | 38,566 | ||||||
Total
nonperforming assets
|
$ | 210,193 | $ | 152,604 | ||||
(1)
- Mississippi includes Central and Southern Mississippi
Regions
|
||||||||
(2)
- Tennessee includes Memphis, Tennessee and Northern Mississippi
Regions
|
Classified
(3)
|
||||||||||||||||||||||||
Total
Loans
|
Criticized
Loans (1)
|
Special
Mention (2)
|
Accruing
|
Nonimpaired
Nonaccrual
|
Impaired
Nonaccrual (4)
|
|||||||||||||||||||
Construction,
land development and other land loans:
|
||||||||||||||||||||||||
Lots
|
$ | 63,645 | $ | 26,047 | $ | - | $ | 12,152 | $ | 11,436 | $ | 2,459 | ||||||||||||
Development
|
28,376 | 17,883 | - | 5,033 | 702 | 12,148 | ||||||||||||||||||
Unimproved
land
|
83,437 | 49,261 | 18,980 | 10,945 | 3,891 | 15,445 | ||||||||||||||||||
1-4
family construction
|
13,237 | 4,726 | - | 1,767 | 244 | 2,715 | ||||||||||||||||||
Other
construction
|
23,279 | 15,051 | 2,745 | 9,665 | 497 | 2,144 | ||||||||||||||||||
Construction,
land development and other land loans
|
211,974 | 112,968 | 21,725 | 39,562 | 16,770 | 34,911 | ||||||||||||||||||
Commercial,
commercial real estate and consumer
|
339,445 | 69,292 | 18,964 | 29,946 | 12,080 | 8,302 | ||||||||||||||||||
Total
Florida loans
|
$ | 551,419 | $ | 182,260 | $ | 40,689 | $ | 69,508 | $ | 28,850 | $ | 43,213 |
Florida
Credit Quality (continued)
|
Total
Loans Less Impaired Loans
|
Loan
Loss Reserves
|
Loan
Loss Reserve % of NonImpaired Loans
|
|||||||||
Construction,
land development and other land loans:
|
||||||||||||
Lots
|
$ | 61,186 | $ | 7,361 | 12.03 | % | ||||||
Development
|
16,228 | 2,237 | 13.78 | % | ||||||||
Unimproved
land
|
67,992 | 9,066 | 13.33 | % | ||||||||
1-4
family construction
|
10,522 | 374 | 3.55 | % | ||||||||
Other
construction
|
21,135 | 3,122 | 14.77 | % | ||||||||
Construction,
land development and other land loans
|
177,063 | 22,160 | 12.52 | % | ||||||||
Commercial,
commercial real estate and consumer
|
331,143 | 7,027 | 2.12 | % | ||||||||
Total
Florida loans
|
$ | 508,206 | $ | 29,187 | 5.74 | % |
|
(1)
|
Criticized
loans equal all special mention and classified
loans.
|
|
(2)
|
Special
mention loans exhibit potential credit weaknesses that, if not resolved,
may ultimately result in a more severe
classification.
|
|
(3)
|
Classified
loans include those loans identified by management as exhibiting
well-defined credit weaknesses that may jeopardize repayment in full of
the debt.
|
|
(4)
|
All
nonaccrual loans over $1 million are individually assessed for
impairment. Impaired loans have been determined to be
collateral dependent and assessed using a fair value
approach. Fair value estimates begin with appraised values,
normally from recently received and reviewed
appraisals. Appraised values are adjusted down for costs
associated with asset disposal. When a loan is deemed to be
impaired, the full difference between book value and the most likely
estimate of the asset’s fair value of the underlying collateral less cost
to sell is charged off.
|
Actual
Regulatory Capital
|
Minimum
Regulatory Capital Required
|
Minimum
Regulatory Provision to be Well-Capitalized
|
||||||||||||||||||||||
At
September 30, 2009:
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
||||||||||||||||||
Total
Capital (to Risk Weighted Assets)
|
||||||||||||||||||||||||
Trustmark
Corporation
|
$ | 1,113,733 | 16.09 | % | $ | 553,913 | 8.00 | % | n/a | n/a | ||||||||||||||
Trustmark
National Bank
|
1,073,756 | 15.68 | % | 547,747 | 8.00 | % | $ | 684,684 | 10.00 | % | ||||||||||||||
Tier
1 Capital (to Risk Weighted Assets)
|
||||||||||||||||||||||||
Trustmark
Corporation
|
$ | 977,215 | 14.11 | % | $ | 276,956 | 4.00 | % | n/a | n/a | ||||||||||||||
Trustmark
National Bank
|
938,213 | 13.70 | % | 273,874 | 4.00 | % | $ | 410,810 | 6.00 | % | ||||||||||||||
Tier
1 Capital (to Average Assets)
|
||||||||||||||||||||||||
Trustmark
Corporation
|
$ | 977,215 | 10.70 | % | $ | 273,881 | 3.00 | % | n/a | n/a | ||||||||||||||
Trustmark
National Bank
|
938,213 | 10.42 | % | 270,136 | 3.00 | % | $ | 450,227 | 5.00 | % |
Estimated
Annual % Change
|
||||||||
in
Net Interest Income
|
||||||||
9/30/2009
|
9/30/2008
|
|||||||
Change
in Interest Rates
|
||||||||
+200
basis points
|
-1.5 | % | -2.8 | % | ||||
+100
basis points
|
-1.3 | % | -1.2 | % | ||||
-100
basis points
|
-2.2 | % | 0.6 | % |
Estimated
% Change
|
||||||||
in
Net Portfolio Value
|
||||||||
9/30/2009
|
9/30/2008
|
|||||||
Change
in Interest Rates
|
||||||||
+200
basis points
|
1.9 | % | -6.5 | % | ||||
+100
basis points
|
2.1 | % | -2.9 | % | ||||
-100
basis points
|
-2.1 | % | 1.2 | % |
Form
of Time-Based TARP-Compliant Restricted Stock Agreement for Executive
(under the 2005 Stock and Incentive Compensation Plan).
|
|
Form
of Performance-Based TARP-Compliant Restricted Stock Agreement for
Executive (under the 2005 Stock and Incentive Compensation
Plan.)
|
|
Certification
of the Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
Certification
of the Principal Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
Certification
of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
Certification
of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
All
other exhibits are omitted, as they are inapplicable or not required by
the related instructions.
|
TRUSTMARK CORPORATION | ||||
BY:
|
/s/ Richard G. Hickson
|
BY:
|
/s/ Louis E. Greer
|
|
Richard
G. Hickson
|
Louis
E. Greer
|
|||
Chairman
of the Board, President
&
Chief Executive Officer
|
Treasurer
and Principal
Financial
Officer
|
|||
DATE:
|
November
9, 2009
|
DATE:
|
November
9, 2009
|
|
(a)
|
“Affected
MHCE” means one of the Company’s top five most highly compensated
employees as provided in the CPP Requirements for purposes of the golden
parachute prohibition thereof.
|
|
(b)
|
“Aggregate
TARP Financial Assistance” means all Company obligations arising from
financial assistance provided to the Company under the CPP pursuant to
authority granted under the EESA.
|
|
(c)
|
“ARRA”
means the American Recovery and Reinvestment Act of 2009, as amended from
time to time.
|
|
(d)
|
“CPP”
means the Troubled Asset Relief Program Capital Purchase Program created
by the Treasury Department pursuant to authority granted under the
EESA.
|
|
(e)
|
“CPP
Requirements” means the guidance and regulations issued by the Treasury
Department with respect to the CPP, as such guidance and regulations may
be amended from time to time.
|
|
(f)
|
“EESA”
means the Emergency Economic Stabilization Act of 2008, as amended from
time to time.
|
|
(g)
|
“SEO”
means a senior executive officer as defined in the CPP
Requirements.
|
|
(h)
|
“TARP-compliant
long-term restricted stock” means restricted stock that complies with the
definition of “long-term restricted stock” for purposes of the exception
to the bonus prohibition in the CPP
Requirements.
|
|
(i)
|
“TARP
Period” has commenced on or before the Award Date and ends on the day all
Company obligations arising from financial assistance provided to the
Company under the CPP are satisfied as described in Section
111(b)(3)(D)(i) of the EESA, excluding any period in which the Treasury
Department only holds warrants to purchase common stock as provided in
Section 111(a)(5) of the EESA.
|
|
(j)
|
“Treasury
Department” means the U.S. Department of the
Treasury.
|
|
(a)
|
Subject
to earlier vesting or forfeiture as provided below, the Associate’s
interest in the Award Shares shall become non-forfeitable (“Vested” or
“Vesting”) on <<vesting schedule>>, provided the Associate
remains in employment with the Company or its Subsidiaries through such
date (the “Vesting Date,” and the period from the Award Date through the
Vesting Date being the “Vesting Period” with respect to the Award
Shares).
|
|
(b)
|
Subject
to earlier forfeiture as provided below, in the event a Vesting
Acceleration Event occurs while the Associate is an employee of the
Company or one of its Subsidiaries and prior to the last day of the
Vesting Period, then Vesting in the Award Shares shall be provided for a
time-weighted portion of the Award Shares (determined by multiplying the
number of Award Shares by a fraction (not to exceed one), the numerator of
which is the number of complete calendar months from <<beginning of
period>> (counting the month of <<month, year>> as a
complete calendar month) to and including the Vesting Acceleration Event,
and the denominator of which is the number of whole and partial calendar
months from <<beginning of period>> through the end of the
Vesting Period). In such event, the time-weighted portion of
the Award Shares, as so determined, shall automatically be Vested on the
date of such Vesting Acceleration Event. In such event, the
balance of the Award Shares which are not Vested shall be
forfeited.
|
|
(c)
|
The
following terms have the following meanings for purposes
hereof:
|
|
(i)
|
“Cause”
means that the Associate (A) has committed an act of personal
dishonesty, embezzlement or fraud, (B) has misused alcohol or drugs,
(C) has failed to pay any obligation owed to the Company or any
affiliate, (D) has breached a fiduciary duty or deliberately
disregarded any rule of the Company or any affiliate, (E) has
committed an act of willful misconduct, or the intentional failure to
perform stated duties, (F) has willfully violated any law, rule or
regulation (other than misdemeanors, traffic violations or similar
offenses) or any final cease-and-desist order, (G) has disclosed
without authorization any confidential information of the Company or any
affiliate, (H) has engaged in any conduct constituting unfair
competition, or (I) has induced any customer of the Company or any
affiliate to breach a contract with the Company or any
affiliate.
|
|
(ii)
|
“Vesting
Acceleration Event” means:
|
|
(A)
|
the
Associate’s death or termination of employment due to becoming disabled
(as defined for purposes of Section 22(e)(3) of the Internal Revenue Code,
whether or not the Associate has an Employment
Agreement);
|
|
(B)
|
the
Associate’s termination of employment on or after <<grant date + 2
years>> due to becoming disabled (as defined in his or her
Employment Agreement, if the Associate has an Employment Agreement and his
or her termination is not due to becoming disabled as defined for purposes
of Section 22(e)(3) of the Internal Revenue Code) if on the date of
termination either (i) the TARP Period has ended or (ii) the Associate is
not an SEO or an Affected MHCE;
|
|
(C)
|
the
Associate’s retirement on or after <<grant date + 2 years>>,
with the consent of the Committee or its delegate, at or after age
sixty-five (65) where there is no Cause (as defined above) for the Company
to terminate the Associate’s employment, if on the date of retirement
either (i) the TARP Period has ended or (ii) the Associate is not an SEO
or an Affected MHCE;
|
|
(D)
|
the
termination of the Associate’s employment with the Company and its
Subsidiaries by the Company on or after <<grant date + 2
years>> other than for Cause (as defined herein), if on the date of
termination either (i) the TARP Period has ended or (ii) the Associate is
not an SEO or an Affected MHCE;
|
|
(E)
|
the
termination of the Associate’s employment with the Company and its
Subsidiaries prior to <<grant date + 2 years>> due to of a
Change in Control (as defined in the Plan) which with respect to the
Associate is a change in the ownership or effective control of the Company
or in the ownership of a substantial portion of its assets (as defined in
Section 409A of the Internal Revenue Code), if the Change in Control is
also a change in control event (as defined in 26 CFR 1.280G-1, Q&A-27
through Q&A-29 or as defined in 26 CFR 1.409A-3(i)(5)(i)) and on the
date of termination either (i) the TARP Period has ended or (ii) the
Associate is not an SEO or an Affected
MHCE;
|
|
(F)
|
the
occurrence on or after <<grant date + 2 years>> of a Change in
Control (as defined in the Plan) which with respect to the Associate is a
change in the ownership or effective control of the Company or in the
ownership of a substantial portion of its assets (as defined in Section
409A of the Internal Revenue Code), if the Associate has remained employed
with the Company or a Subsidiary through the date the Change in Control
occurs, and on the date such Change in Control occurs either (i) the TARP
Period has ended or (ii) the Associate is not an SEO or an Affected MHCE;
or
|
|
(G)
|
if
the Associate has an Employment Agreement, the Associate’s termination of
employment with the Company and its Subsidiaries at his or her own
initiative on or after <<grant date + 2 years>> for “Good
Reason” (as defined in his or her Employment Agreement, but only if
defined therein) if on the date of termination either (i) the TARP Period
has ended or (ii) the Associate is not an SEO or an Affected
MHCE.
|
|
For
purposes of determining a Vesting Acceleration Event, an “Employment
Agreement” means a written individual employment agreement, or if there is
no employment agreement, then a written individual change in control
agreement, as in effect on the Award Date between the Associate and the
Company or one of its Subsidiaries. If an Associate does not
have such a written individual employment agreement or change in control
agreement, the Associate is considered not to have an Employment Agreement
for purposes hereof.
|
4.
|
Transferability of
Award Shares
.
|
|
(a)
|
If
the Vesting of any Award Shares occurs before the end of the TARP Period,
such Vested Award Shares shall not become freely transferable until the
first day after the TARP Period ends, subject however, to the following
accelerated transferability (determined on a cumulative basis for Vested
Award Shares):
|
|
(i)
|
25%
of the Award Shares (rounded down to the next whole share if a fractional
share would otherwise become transferable) may become freely transferable
at the time of the Company’s repayment of 25% of the Aggregate TARP
Financial Assistance,
|
|
(ii)
|
An
additional 25% of the Award Shares (rounded down to the next whole share
if a fractional share would otherwise become transferable) may become
freely transferable (for an aggregate total of 50% of the Award Shares) at
the time of the Company’s repayment of 50% of the Aggregate TARP Financial
Assistance,
|
|
(iii)
|
An
additional 25% of the Award Shares (rounded down to the next whole share
if a fractional share would otherwise become transferable) may become
freely transferable (for an aggregate total of 75% of the Award Shares) at
the time of the Company’s repayment of 75% of the Aggregate TARP Financial
Assistance, and
|
|
(iv)
|
The
remainder of the Award Shares may become freely transferable at the time
of the Company’s repayment of 100% of the Aggregate TARP Financial
Assistance.
|
|
Notwithstanding
the foregoing, where the Associate does not make an election with respect
to the Award Shares under Section 83(b) of the Internal Revenue Code, at
any time beginning with the date upon which the Award Shares become
substantially vested (as defined in 26 CFR 1.83-3(b)) and ending on
December 31 of the calendar year including that date, a portion of
the Vested Award Shares (rounded down to the next whole share if a
fractional share would otherwise become transferable) shall be made freely
transferable as may reasonably be required to pay the federal, state,
local, or foreign taxes that are anticipated to apply to the income
recognized due to such Vesting, and the number of such Vested Award Shares
made freely transferable for this purpose shall not count toward the
percentages in the schedule ((i) through (iv))
above.
|
|
(b)
|
If
the Vesting of any Award Shares occurs after the end of the TARP Period,
such Vested Award Shares shall also become freely transferable at the same
time as Vesting occurs.
|
|
(c)
|
Except
as contemplated in Paragraph 4(a) and/or (b), the Award Shares, and the
rights and privileges conferred hereby, shall not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated in any way,
otherwise than by will or by the laws of descent and distribution, and
shall not be subject to execution, attachment or similar process, prior to
the later of their Vesting or the end of the TARP Period (the period from
the Award Date through such latter date being the “Non-Transferability
Period”).
|
|
(a)
|
The
Company shall issue the Award Shares either: (i) in certificate form as
provided in Paragraph 5(b) below; or (ii) in book entry form, registered
in the name of the Associate with notations regarding the applicable
restrictions on transfer imposed under this
Agreement.
|
|
(b)
|
Any
certificates representing the Award Shares shall be held by the Company
until such time as the Non-Transferability Period with respect to the
Award Shares lapses, or the Award Shares are forfeited
hereunder. Any Award Shares issued in book entry form shall be
subject to the following legend, and any certificates representing the
Award Shares shall bear the following legend, during the
Non-Transferability Period:
|
|
(c)
|
Promptly
after the Non-Transferability Period lapses with respect to any of the
Award Shares, the Company shall, as applicable, either remove the
notations on any of the Award Shares issued in book entry form as to which
the Non-Transferability Period has lapsed or deliver to the Associate a
certificate or certificates evidencing the number of Award Shares as to
which the Non-Transferability Period has
lapsed.
|
|
(d)
|
The
Committee may require, concurrently with the execution and delivery of
this Agreement, the Associate to deliver to the Company an executed stock
power, in blank, with respect to the Award Shares. The
Associate, by acceptance of the Award, shall be deemed to appoint, and
does so appoint by execution of this Agreement, the Company and each of
its authorized representatives as the Associate’s attorney(s) in fact to
effect any transfer of forfeited shares (or shares otherwise reacquired or
withheld by the Company hereunder), or any adjustment to the number of
Award Shares pursuant to Paragraph 14 or 15 below, to the Company as may
be required pursuant to the Plan or this Agreement and to execute such
documents as the Company or such representatives deem necessary or
advisable in connection with any such
transfer.
|
Trustmark
Corporation
|
Mailing Address
|
|
248
E. Capitol Street
|
P.O.
Box 291
|
|
Jackson,
MS 39201
|
Jackson,
MS 39205
|
|
Attention: Secretary
|
|
(a)
|
It
is intended that any right or benefit which is provided pursuant to or in
connection with this Award which is considered to be nonqualified deferred
compensation subject to Section 409A (“Section 409A”) of the Internal
Revenue Code (a “409A benefit”) shall be provided and paid in a manner,
and at such time (i.e., at the applicable event described herein if a
Section 409A payment event or otherwise at the first Section 409A payment
event thereafter consisting of a fixed time (here, the Vesting Date), a
Section 409A disability, a Section 409A separation from service (as
described below), or a Section 409A change with respect to the Associate
in the ownership or effective control of the Company or in the ownership
of a substantial portion of its assets of the Company and including, in
the discretion of the Committee or its delegate, any applicable Section
409A de minimis limited cashout payment rule permitted under Treasury Reg.
Section 1.409A-3(j)(4)(v)) and in such form, as complies with the
applicable requirements of Section 409A to avoid the unfavorable tax
consequences provided therein for non-compliance. Consequently,
this Agreement is intended to be administered, interpreted and construed
in accordance with the applicable requirements of Section
409A. Notwithstanding the foregoing, the Associate and his or
her successor in interest shall be solely responsible and liable for the
satisfaction of all taxes and penalties that may be imposed on the
Associate or his or her successor in interest in connection with this
Agreement (including any taxes and penalties under Section 409A); and
neither the Company nor any of its affiliates shall have any obligation to
indemnify or otherwise hold the Associate or his or her successor in
interest harmless from any or all of such taxes or
penalties.
|
|
(b)
|
Except
as permitted under Section 409A, any 409A benefit payable to the Associate
or for his or her benefit with respect to the Award may not be reduced by,
or offset against, any amount owing by the Associate to the Company or any
of its affiliates.
|
|
(c)
|
To
the extent that entitlement to payment of any 409A benefit occurs due to
termination or cessation of employment, termination or cessation of
employment shall be read to mean “separation from service” (within the
meaning of Section 409A and as applicable to the Company and its
affiliates). Where entitlement to payment occurs by reason of
such termination or cessation of employment and the Associate is a
“specified employee” (within the meaning of Section 409A, as applicable to
the Company and its affiliates and using the identification methodology
selected by the Company from time to time in accordance with Section 409A)
on the date of his or her “separation from service”, then payment of such
409A benefit shall be delayed (without interest) until the first business
day after the end of the six month delay period required under Section
409A or, if earlier, after the Associate’s death. In
determining separation from service, separation from service is determined
based on the “Separation from Service” definition in the Trustmark
Corporation Deferred Compensation Plan (as in effect on
<<date>>), which provides, in part, that in determining
separation from service as an employee, separation from service occurs
when it is reasonably anticipated that no further services would be
performed after that date or that the level of services the Associate
would perform after that date (whether as an employee or independent
contractor) would permanently decrease to less than 50% of the average
level of bona fide services performed over the immediately preceding
<<months>> month
period.
|
15.
|
CPP
Limitations
.
|
|
(a)
|
The
Company has participated in the CPP, and the Company is required to comply
with the requirements of Section 111(b) of the EESA, in accordance with
the CPP Requirements.
|
|
(b)
|
Notwithstanding
any other provision of this Agreement to the contrary, the Associate
acknowledges and understands that this Agreement shall be administered,
interpreted and construed and, if and where applicable, benefits provided
hereunder, including where applicable vesting and/or transferability,
shall be limited, deferred, forfeited and/or subject to repayment to the
Company in accordance with the CPP Requirements and Section 111(b) of the
EESA, as amended from time to time, to the extent legally applicable with
respect to the Associate, as determined by the Committee in its
discretion, including without limitation the clawback, the bonus
prohibition and the golden parachute prohibitions
thereof.
|
|
(c)
|
This
Award is intended to provide a grant of TARP-compliant long-term
restricted stock and shall be administered and interpreted in accordance
with that intent and purpose.
|
|
(d)
|
Without
any further action, this Agreement shall be automatically adjusted if
necessary to reduce the number of Award Shares to the maximum number
permitted for this Award, together with other awards granted to the
Associate in calendar year <<year of grant>> that are taken
into account in determining compliance with the TARP-compliant long-term
restricted stock exception to the bonus prohibition in the CPP
Requirements (i.e., if the aggregate of such awards has a value in excess
of the 1/3
rd
of annual compensation limit for TARP-compliant long-term restricted
stock), to constitute TARP-compliant long-term restricted stock; and in
such event the number of Award Shares which are reduced shall be
immediately forfeited and excluded from the definition of Award Shares,
ab
initio
, for all
purposes of this Agreement. If the Associate receives or has
received in calendar year <<year of grant>> other awards of
restricted stock and/or restricted stock units also intending to
constitute TARP-compliant long-term restricted stock, the reduction in
Award Shares required by this Paragraph shall be applied as follows: (i)
any later grant of restricted stock or restricted stock units to the
Associate in calendar year <<year of grant>> shall be reduced
before any earlier award granted to the Associate in calendar year
<<year of grant>>; and (ii) if multiple awards of
restricted stock and/or restricted stock units that must be taken into
account in determining compliance with the TARP-compliant long-term
restricted stock exception are granted to the Associate on the same day,
(A) where such awards are “Time-Based” (i.e., those vesting solely on
the basis of time) awards and “Performance-Based” awards (i.e., those
vesting, in whole or in part, on the basis of performance metrics), the
number of Award Shares shall be reduced pro rata in each award,
(B) where “Performance-Based” awards contain both Award Shares and
Excess Shares in one award agreement (as this Agreement does), the maximum
number of Excess Shares shall automatically be reduced by the same number
as the reduction in the Award Shares before application of any of the
Vesting or Excess Share issuance provisions of this Agreement (i.e., if
there is a one share reduction in Award Shares, there will also be a one
share reduction in the maximum number of Excess Shares that could be
issued), and (C) lastly all other awards shall be reduced on a pro
rata basis.
|
|
(e)
|
The
Committee shall have the right unilaterally to amend this Agreement to
effect or document any changes or additions which in its view are
necessary or appropriate to comply with the CPP Requirements and Section
111 of the EESA, as amended from time to time, including any changes or
additions which in its view are necessary or appropriate to ensure that
this Award constitutes TARP-compliant long-term restricted stock for
purposes of the CPP Requirements.
|
COMPANY:
|
||
TRUSTMARK
CORPORATION
|
||
By:
|
||
Its:
|
||
ASSOCIATE
:
|
||
By:
|
|
|
<<name>> |
2.
|
TARP
Terminology
. For purposes of this Agreement, the
following terms have the following
meanings:
|
|
(a)
|
“Affected
MHCE” means one of the Company’s top five most highly compensated
employees as provided in the CPP Requirements for purposes of the golden
parachute prohibition thereof.
|
|
(b)
|
“Aggregate
TARP Financial Assistance” means all Company obligations arising from
financial assistance provided to the Company under the CPP pursuant to
authority granted under the EESA.
|
|
(c)
|
“ARRA”
means the American Recovery and Reinvestment Act of 2009, as amended from
time to time.
|
|
(d)
|
“CPP”
means the Troubled Asset Relief Program Capital Purchase Program created
by the Treasury Department pursuant to authority granted under the
EESA.
|
|
(e)
|
“CPP
Requirements” means the guidance and regulations issued by the Treasury
Department with respect to the CPP, as such guidance and regulations may
be amended from time to time.
|
|
(f)
|
“EESA”
means the Emergency Economic Stabilization Act of 2008, as amended from
time to time.
|
|
(g)
|
“SEO”
means a senior executive officer as defined in the CPP
Requirements.
|
|
(h)
|
“TARP-compliant
long-term restricted stock” means restricted stock that complies with the
definition of “long-term restricted stock” for purposes of the exception
to the bonus prohibition in the CPP
Requirements.
|
|
(i)
|
“TARP
Period” has commenced on or before the Award Date and ends on the day all
Company obligations arising from financial assistance provided to the
Company under the CPP are satisfied as described in Section
111(b)(3)(D)(i) of the EESA, excluding any period in which the Treasury
Department only holds warrants to purchase common stock as provided in
Section 111(a)(5) of the EESA.
|
(j)
|
“Treasury
Department” means the U.S. Department of the
Treasury.
|
|
(a)
|
Subject
to earlier vesting or forfeiture as provided below, the Associate’s
interest in the following applicable portion of the Award Shares shall
become non-forfeitable (“Vested” or “Vesting”) on <<vesting
date>>, provided the Associate remains in employment with the
Company or its Subsidiaries through such date, with Vesting in the Award
Shares being determined by the Company’s return on average tangible equity
(“ROATE”) and total shareholder return (“TSR”) ranking for the
<<number>> calendar quarters beginning <<beginning of
measurement period>> and ending <<end of measurement
period>> (the “Performance Period”) compared to the ROATE and TSR
for the Peer Group (see Attachment A) as follows, where Vesting in
the Award Shares is equal to the number of the Award Shares multiplied by
the sum of the vesting percentage in (A) and the vesting percentage in (B)
below:
|
(A)
|
(B)
|
|||
ROATE
|
ROATE
|
TSR
|
TSR
|
|
Ranking
|
Vesting Percentage
|
Ranking
|
Vesting Percentage
|
|
<<rank>>
Percentile
|
100%
|
+
|
<<rank>>
Percentile
|
100%
|
<<rank>>
Percentile
|
90%
|
+
|
<<rank>>
Percentile
|
90%
|
<<rank>>
Percentile
|
70%
|
+
|
<<rank>>
Percentile
|
70%
|
<<rank>>
Percentile
|
50%
|
+
|
<<rank>>
Percentile
|
50%
|
<<rank>>
Percentile
|
32.5%
|
+
|
<<rank>>
Percentile
|
32.5%
|
<<rank>>
Percentile
|
22.5%
|
+
|
<<rank>>
Percentile
|
22.5%
|
<<rank>>
Percentile
|
17.5%
|
+
|
<<rank>>
Percentile
|
17.5%
|
Less
than <<rank>>
|
0%
|
+
|
Less
than <<rank>>
|
0%
|
|
If
the Company’s ranking is above the <<rank>> percentile, but
less than the <<rank>> percentile, then the vesting percentage
shall be determined by straight line interpolation (rounded, where not
otherwise resulting in a whole or half percent, to the next lowest whole
or half percent) where the ranking falls between identified percentile
tiers (for example, if the ranking is in the <<rank>>
percentile, then the vesting percentage is
<<%>>).
|
|
If
the aggregate Vesting exceeds 100%, all Award Shares shall be Vested and
Excess Shares shall be granted as provided in Paragraph
13.
|
|
All
determinations regarding Vesting in the Award Shares under this Paragraph
3(a) shall be made and certified to in writing by the Committee during the
first 2-1/2 months following the end of the Performance
Period.
|
|
The
balance of any Award Shares that are not considered Vested by or as of the
last day of the Performance Period shall be
forfeited.
|
|
(b)
|
Subject
to earlier forfeiture as provided below, in the event a Vesting
Acceleration Event occurs while the Associate is an employee of the
Company or one of its Subsidiaries and prior to the last day of the
Performance Period, then the ROATE and the TSR of the Company and the Peer
Group shall be determined for all calendar quarters in the Performance
Period ending on or prior to the date of the first such Vesting
Acceleration Event and the Vesting provisions set forth in Paragraph 3(a)
shall be applied to a time-weighted portion of the Award Shares
(determined by multiplying the number of Award Shares by a fraction (not
to exceed one), the numerator of which is the number of complete calendar
months from the beginning of the Performance Period to and including the
Vesting Acceleration Event, and the denominator of which is the number of
calendar months in the Performance Period) based on such ROATE and the
TSR. In such event, the time-weighted portion of the Award
Shares, as so determined, shall automatically be Vested on the date of
such Vesting Acceleration Event. In such event, the balance of
the Award Shares which are not Vested shall be forfeited, and no Excess
Shares (as otherwise provided for in Paragraph 13) shall be
granted. All determinations regarding Vesting in the Award
Shares under this Paragraph 3(b) shall be made and certified to in writing
by the Committee during the period beginning on the date of the Vesting
Acceleration Event and ending 2-1/2 months following the end of the
calendar quarter in which the Vesting Acceleration Event
occurs.
|
|
(c)
|
The
following terms have the following meanings for purposes
hereof:
|
|
(i)
|
“Cause”
means that the Associate (A) has committed an act of personal
dishonesty, embezzlement or fraud, (B) has misused alcohol or drugs,
(C) has failed to pay any obligation owed to the Company or any
affiliate, (D) has breached a fiduciary duty or deliberately
disregarded any rule of the Company or any affiliate, (E) has
committed an act of willful misconduct, or the intentional failure to
perform stated duties, (F) has willfully violated any law, rule or
regulation (other than misdemeanors, traffic violations or similar
offenses) or any final cease-and-desist order, (G) has disclosed
without authorization any confidential information of the Company or any
affiliate, (H) has engaged in any conduct constituting unfair
competition, or (I) has induced any customer of the Company or any
affiliate to breach a contract with the Company or any
affiliate.
|
|
(ii)
|
“Peer
Group” means the financial institutions listed on Attachment A
hereto; provided that subject to any restrictions and limitations under
Section 162(m) of the Internal Revenue Code, any listed financial
institution shall be eliminated if it is acquired or otherwise changes its
structure or business such that it is no longer reasonably comparable to
the Company (as determined by the Committee), and in the case of any such
elimination, the Committee may replace the eliminated financial
institution with another financial institution which it considers
reasonably comparable to the
Company.
|
|
(iii)
|
“ROATE”
means the cumulative net earnings after taxes available to common
shareholders, adjusted for tax-affected amortization of intangibles, for
the calendar quarters in each calendar year in a specified period of time
divided by average shareholder’s tangible common equity (which is the
excess of the difference between the total assets, excluding total
identifiable intangible assets and goodwill, and the sum of total
liabilities and preferred equity, averaged for the calendar quarters in
each calendar year in the specified period), all as determined in
accordance with generally accepted accounting principles and as reported
in the company’s financial statements provided to shareholders and
converted to an annual rate by dividing by the number of years and partial
years (expressed in quarters) in the specified
period.
|
|
(iv)
|
“TSR”
means the return a holder of common stock earns over a specified period of
time, expressed as a percentage and including changes in Average Market
Value of, and dividends or other distributions with respect to, the stock
and converted to an annual rate by dividing the calculated percentage for
the specified period by the number of years and partial years (expressed
in quarters) in the specified period. TSR return shall be
determined as the sum of (A) the Ending Average Market Value reduced
by the Beginning Average Market Value and (B) dividends or other
distributions with respect to a share paid during the specified period and
with such dividends and other distributions deemed reinvested in Stock
(based on Market Share Price on the date of payment where not paid in
Stock), and (C) with such sum being divided by the Beginning Average
Market Value. TSR, including the value of reinvested dividends
and other distributions, shall be determined on the basis of the
appropriate total shareholder return model of Bloomberg L.P. or any
affiliate thereof or such other authoritative source as the Committee may
determine. For purposes
hereof:
|
|
(A)
|
“Average
Market Value” means the average of the closing sale price of such stock
for the applicable ten trading days beginning or ending on a specified
date for which such closing sales price is reported by Bloomberg L.P. or
any affiliate thereof or such other authoritative source as the Committee
may determine.
|
|
(B)
|
“Beginning
Average Market Value” means the Average Market Value based on the first
ten trading days of the Performance
Period.
|
|
(C)
|
“Ending
Average Market Value” means the Average Market Value based on the last ten
trading days of the Performance Period (or other period as of which Ending
Average Market Value is
calculated).
|
|
(D)
|
“Market
Share Price” means the closing sale price for the specified day (or the
last preceding day thereto for which reported) as reported by Bloomberg
L.P. or any affiliate thereof or such other authoritative source as the
Committee may determine.
|
|
(v)
|
“Vesting
Acceleration Event” means during the Performance Period with respect to
the Award Shares and during the Excess Share Vesting Period (as defined
below) with respect to the Excess Shares, as
applicable:
|
|
(A)
|
the
Associate’s death or termination of employment due to becoming disabled
(as defined for purposes of Section 22(e)(3) of the Internal Revenue Code,
whether or not the Associate has an Employment
Agreement);
|
|
(B)
|
the
Associate’s termination of employment on or after <<grant date + 2
years>> due to becoming disabled (as defined in his or her
Employment Agreement, if the Associate has an Employment Agreement and his
or her termination is not due to becoming disabled as defined for purposes
of Section 22(e)(3) of the Internal Revenue Code) if on the date of
termination either (i) the TARP Period has ended or (ii) the Associate is
not an SEO or an Affected MHCE;
|
|
(C)
|
the
Associate’s retirement on or after <<grant date + 2 years>>,
with the consent of the Committee or its delegate, at or after age
sixty-five (65) where there is no Cause (as defined above) for the Company
to terminate the Associate’s employment, if on the date of retirement
either (i) the TARP Period has ended or (ii) the Associate is not an SEO
or an Affected MHCE;
|
|
(D)
|
the
termination of the Associate’s employment with the Company and its
Subsidiaries by the Company on or after <<grant date + 2
years>> other than for Cause (as defined herein), if on the date of
termination either (i) the TARP Period has ended or (ii) the Associate is
not an SEO or an Affected MHCE;
|
|
(E)
|
the
termination of the Associate’s employment with the Company and its
Subsidiaries prior to <<grant date + 2 years>> due to of a
Change in Control (as defined in the Plan) which with respect to the
Associate is a change in the ownership or effective control of the Company
or in the ownership of a substantial portion of its assets (as defined in
Section 409A of the Internal Revenue Code), if the Change in Control is
also a change in control event (as defined in 26 CFR 1.280G-1, Q&A-27
through Q&A-29 or as defined in 26 CFR 1.409A-3(i)(5)(i)) and on the
date of termination either (i) the TARP Period has ended or (ii) the
Associate is not an SEO or an Affected
MHCE;
|
|
(F)
|
the
occurrence on or after <<grant date + 2 years>> of a Change in
Control (as defined in the Plan) which with respect to the Associate is a
change in the ownership or effective control of the Company or in the
ownership of a substantial portion of its assets (as defined in Section
409A of the Internal Revenue Code), if the Associate has remained employed
with the Company or a Subsidiary through the date the Change in Control
occurs, and on the date such Change in Control occurs either (i) the TARP
Period has ended or (ii) the Associate is not an SEO or an Affected MHCE;
or
|
|
(G)
|
if
the Associate has an Employment Agreement, the Associate’s termination of
employment with the Company and its Subsidiaries at his or her own
initiative on or after <<grant date + 2 years>> for “Good
Reason” (as defined in his or her Employment Agreement, but only if
defined therein) if on the date of termination either (i) the TARP Period
has ended or (ii) the Associate is not an SEO or an Affected
MHCE.
|
|
For
purposes of determining a Vesting Acceleration Event, an “Employment
Agreement” means a written individual employment agreement, or if there is
no employment agreement, then a written individual change in control
agreement, as in effect on the Award Date between the Associate and the
Company or one of its Subsidiaries. If an Associate does not
have such a written individual employment agreement or change in control
agreement, the Associate is considered not to have an Employment Agreement
for purposes hereof.
|
4.
|
Transferability of
Award Shares
.
|
|
(a)
|
If
the Vesting of any Award Shares occurs before the end of the TARP Period,
such Vested Award Shares shall not become freely transferable until the
first day after the TARP Period ends, subject however, to the following
accelerated transferability (determined on a cumulative basis for Vested
Award Shares:
|
|
(i)
|
25%
of the Award Shares (rounded down to the next whole share if a fractional
share would otherwise become transferable) may become freely transferable
at the time of the Company’s repayment of 25% of the Aggregate TARP
Financial Assistance,
|
|
(ii)
|
An
additional 25% of the Award Shares (rounded down to the next whole share
if a fractional share would otherwise become transferable) may become
freely transferable (for an aggregate total of 50% of the Award Shares) at
the time of the Company’s repayment of 50% of the Aggregate TARP Financial
Assistance,
|
|
(iii)
|
An
additional 25% of the Award Shares (rounded down to the next whole share
if a fractional share would otherwise become transferable) may become
freely transferable (for an aggregate total of 75% of the Award Shares) at
the time of the Company’s repayment of 75% of the Aggregate TARP Financial
Assistance, and
|
|
(iv)
|
The
remainder of the Award Shares may become freely transferable at the time
of the Company’s repayment of 100% of the Aggregate TARP Financial
Assistance.
|
|
Notwithstanding
the foregoing, where the Associate does not make an election with respect
to the Award Shares under Section 83(b) of the Internal Revenue Code, at
any time beginning with the date upon which the Award Shares become
substantially vested (as defined in 26 CFR 1.83-3(b)) and ending on
December 31 of the calendar year including that date, a portion of
the Vested Award Shares (rounded down to the next whole share if a
fractional share would otherwise become transferable) shall be made freely
transferable as may reasonably be required to pay the federal, state,
local, or foreign taxes that are anticipated to apply to the income
recognized due to such Vesting, and the number of such Vested Award Shares
made freely transferable for this purpose shall not count toward the
percentages in the schedule ((i) through (iv))
above.
|
|
(b)
|
If
the Vesting of any Award Shares occurs after the end of the TARP Period,
such Vested Award Shares shall also become freely transferable at the same
time as Vesting occurs.
|
|
(c)
|
Except
as contemplated in Paragraph 4(a) and/or (b), the Award Shares, and the
rights and privileges conferred hereby, shall not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated in any way,
otherwise than by will or by the laws of descent and distribution, and
shall not be subject to execution, attachment or similar process, prior to
the later of their Vesting or the end of the TARP Period (the period from
the Award Date through such latter date being the “Non-Transferability
Period” with respect to the Award
Shares).
|
|
(a)
|
The
Company shall issue the Award Shares and Excess Shares, if any, either:
(i) in certificate form as provided in Paragraph 5(b) below; or (ii) in
book entry form, registered in the name of the Associate with notations
regarding the applicable restrictions on transfer imposed under this
Agreement.
|
|
(b)
|
Any
certificates representing Award Shares or Excess Shares shall be held by
the Company until such time as the Non-Transferability Period with respect
to such shares lapses, or such shares are forfeited
hereunder. Any Award Shares or Excess Shares issued in book
entry form shall be subject to the following legend, and any certificates
representing the Award Shares or Excess Shares shall bear the following
legend, during the Non-Transferability Period with respect to the Award
Shares or the Excess Shares, as
applicable:
|
|
(c)
|
Promptly
after the Non-Transferability Period lapses with respect to any of the
Award Shares or Excess Shares, as applicable, the Company shall, as
applicable, either remove the notations on any of such shares issued in
book entry form as to which the Non-Transferability Period has lapsed or
deliver to the Associate a certificate or certificates evidencing the
number of such shares as to which the Non-Transferability Period has
lapsed.
|
|
(d)
|
The
Committee may require, concurrently with the execution and delivery of
this Agreement, the Associate to deliver to the Company an executed stock
power, in blank, with respect to the Award Shares or Excess
Shares. The Associate, by acceptance of the Award, shall be
deemed to appoint, and does so appoint by execution of this Agreement, the
Company and each of its authorized representatives as the Associate’s
attorney(s) in fact to effect any transfer of forfeited shares (or shares
otherwise reacquired or withheld by the Company hereunder), or any
adjustment to the number of Award Shares or Excess Shares pursuant to
Paragraph 15 or 16 below, to the Company as may be required pursuant to
the Plan or this Agreement and to execute such documents as the Company or
such representatives deem necessary or advisable in connection with any
such transfer.
|
Trustmark
Corporation
|
Mailing Address
|
|
248
E. Capitol Street
|
P.O.
Box 291
|
|
Jackson,
MS 39201
|
Jackson,
MS 39205
|
|
Attention: Secretary
|
|
(a)
|
Since
Vesting in the Award Shares pursuant to Paragraph 3(a) equals the number
of Award Shares multiplied by the sum of the applicable ROATE vesting
percentage and the applicable TSR vesting percentage, the aggregate
Vesting pursuant to Paragraph 3(a) could exceed 100%. In that
event, additional Restricted Stock (“Excess Shares”) shall be granted to
the Associate within the first 2-1/2 months following the end of the
Performance Period in a number equal to the excess of the aggregate
Vesting pursuant to Paragraph 3(a) over 100% multiplied by the number of
Award Shares granted on the Award Date (as adjusted by the Committee
pursuant to Section 4.4 of the Plan to reflect such events as stock
dividends, stock splits, recapitalizations, mergers, consolidations or
reorganizations of or by the Company). No Excess Shares shall
be granted in connection with Vesting pursuant to Paragraph
3(b).
|
|
(b)
|
The
Excess Shares, if any, shall be subject to the following terms and
conditions:
|
|
(i)
|
Voting
rights shall be provided from the date of grant of the Excess
Shares.
|
|
(ii)
|
During
the Non-Transferability Period with respect to the Excess Shares and after
the date of grant thereof, subject to Paragraphs 15 and 16, all dividends
and other distributions paid with respect to the Excess Shares (whether in
cash, property or shares of the Company’s Stock) shall be registered in
the name of the Associate and held by the Company until payable or
forfeited pursuant hereto. Such dividends and other
distributions shall be subject to the same Vesting rules and restrictions
on transferability as the Excess Shares with respect to which they were
paid and shall, to the extent Vested, be paid when and to the extent the
Non-Transferability Period has lapsed with respect to the underlying
Excess Shares. No dividends and other distributions shall be
accumulated for periods before the date of grant of the Excess
Shares.
|
|
(iii)
|
Subject
to earlier vesting or forfeiture as provided below, if the Associate
remains continuously employed by the Company or one of its Subsidiaries
from the beginning of the Performance Period through <<Excess Share
vesting date>> (the “Excess Share Regular Vesting Date,” and the
period from the last day of the Performance Period through the Excess
Share Regular Vesting Date being the “Excess Share Vesting Period” with
respect to the Excess Shares), then the Excess Shares shall become
non-forfeitable (i.e., Vested) on the Excess Share Regular Vesting
Date.
|
|
(iv)
|
Notwithstanding
Paragraph 13(b)(iii) above, but subject to earlier forfeiture as provided
below, in the event a Vesting Acceleration Event occurs while the
Associate is employed by the Company or one of its Subsidiaries and on or
after the last day of the Performance Period, but prior to the Excess
Share Regular Vesting Date, then the Excess Shares shall be Vested as of
the date the Vesting Acceleration Event
occurs.
|
|
(v)
|
If
the Associate’s employment with the Company and its Subsidiaries ceases
prior to the Excess Share Regular Vesting Date and Vesting pursuant to a
Vesting Acceleration Event in Paragraph 13(b)(iv) does not apply, then the
Excess Shares that are not considered Vested by or at the cessation of the
Associate’s employment with the Company and its Subsidiaries shall be
automatically forfeited to the
Company.
|
|
(vi)
|
Transferability
of Vested Excess Shares shall be determined pursuant to Paragraph
13(c).
|
|
(c)
|
In
addition, transferability of the Excess Shares, if any, shall be subject
to the following terms and
conditions:
|
|
(i)
|
If
the Vesting of any Excess Shares occurs before the end of the TARP Period,
such Vested Excess Shares shall not become freely transferable until the
first day after the TARP Period ends, subject however, to the following
accelerated transferability (determined on a cumulative basis for Vested
Excess Shares):
|
|
(A)
|
25%
of the Excess Shares (rounded down to the next whole share if a fractional
share would otherwise become transferable) may become freely transferable
at the time of the Company’s repayment of 25% of the Aggregate TARP
Financial Assistance,
|
|
(B)
|
An
additional 25% of the Excess Shares (rounded down to the next whole share
if a fractional share would otherwise become transferable) may become
freely transferable (for an aggregate total of 50% of the Award Shares) at
the time of the Company’s repayment of 50% of the Aggregate TARP Financial
Assistance,
|
|
(C)
|
An
additional 25% of the Excess Shares (rounded down to the next whole share
if a fractional share would otherwise become transferable) may become
freely transferable (for an aggregate total of 75% of the Award Shares) at
the time of the Company’s repayment of 75% of the Aggregate TARP Financial
Assistance, and
|
|
(D)
|
The
remainder of the Excess Shares may become freely transferable at the time
of the Company’s repayment of 100% of the Aggregate TARP Financial
Assistance.
|
|
Notwithstanding
the foregoing, where the Associate does not make an election with respect
to the Excess Shares under Section 83(b) of the Internal Revenue Code, at
any time beginning with the date upon which the Excess Shares become
substantially vested (as defined in 26 CFR 1.83-3(b)) and ending on
December 31 of the calendar year including that date, a portion of
the Vested Excess Shares (rounded down to the next whole share if a
fractional share would otherwise become transferable) shall be made freely
transferable as may reasonably be required to pay the federal, state,
local, or foreign taxes that are anticipated to apply to the income
recognized due to such Vesting, and the number of such Vested Excess
Shares made freely transferable for this purpose shall not count toward
the percentages in the schedule ((A) through (D))
above.
|
|
(ii)
|
If
the Vesting of any Excess Shares occurs after the end of the TARP Period,
such Vested Excess Shares shall also become freely transferable at the
same time as Vesting occurs.
|
|
(iii)
|
Except
as contemplated in Paragraph 13(c)(i) and/or 13(c)(ii), the Excess Shares,
and the rights and privileges conferred hereby, shall not be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated in
any way, otherwise than by will or by the laws of descent and
distribution, and shall not be subject to execution, attachment or similar
process, prior to the later of their Vesting or the end of the TARP Period
(the period from the last day of the Performance Period through such
latter date being the “Non-Transferability Period” with respect to the
Excess Shares).
|
|
(a)
|
It
is intended that any right or benefit which is provided pursuant to or in
connection with this Award which is considered to be nonqualified deferred
compensation subject to Section 409A (“Section 409A”) of the Internal
Revenue Code (a “409A benefit”) shall be provided and paid in a manner,
and at such time (i.e., at the applicable event described herein if a
Section 409A payment event or otherwise at the first Section 409A payment
event thereafter consisting of a fixed time (here, the 2-1/2 month period
from <<vesting determination period>> for Award Shares and
<<Excess Share vesting date>> for Excess Shares), a Section
409A disability, a Section 409A separation from service (as described
below), or a Section 409A change with respect to the Associate in the
ownership or effective control of the Company or in the ownership of a
substantial portion of its assets of the Company and including, in the
discretion of the Committee or its delegate, any applicable Section 409A
de minimis limited cashout payment permitted under Treasury Reg. Section
1.409A-3(j)(4)(v)) and in such form, as complies with the applicable
requirements of Section 409A to avoid the unfavorable tax consequences
provided therein for non-compliance. Consequently, this
Agreement is intended to be administered, interpreted and construed in
accordance with the applicable requirements of Section
409A. Notwithstanding the foregoing, the Associate and his or
her successor in interest shall be solely responsible and liable for the
satisfaction of all taxes and penalties that may be imposed on the
Associate or his or her successor in interest in connection with this
Agreement (including any taxes and penalties under Section 409A); and
neither the Company nor any of its affiliates shall have any obligation to
indemnify or otherwise hold the Associate or his or her successor in
interest harmless from any or all of such taxes or
penalties.
|
|
(b)
|
Except
as permitted under Section 409A, any 409A benefit payable to the Associate
or for his or her benefit with respect to the Award may not be reduced by,
or offset against, any amount owing by the Associate to the Company or any
of its affiliates.
|
|
(c)
|
To
the extent that entitlement to payment of any 409A benefit occurs due to
termination or cessation of employment, termination or cessation of
employment shall be read to mean “separation from service” (within the
meaning of Section 409A and as applicable to the Company and its
affiliates). Where entitlement to payment occurs by reason of
such termination or cessation of employment and the Associate is a
“specified employee” (within the meaning of Section 409A, as applicable to
the Company and its affiliates and using the identification methodology
selected by the Company from time to time in accordance with Section 409A)
on the date of his or her “separation from service”, then payment of such
409A benefit shall be delayed (without interest) until the first business
day after the end of the six month delay period required under Section
409A or, if earlier, after the Associate’s death. In
determining separation from service, separation from service is determined
based on the “Separation from Service” definition in the Trustmark
Corporation Deferred Compensation Plan (as in effect on
<<date>>), which provides, in part, that in determining
separation from service as an employee, separation from service occurs
when it is reasonably anticipated that no further services would be
performed after that date or that the level of services the Associate
would perform after that date (whether as an employee or independent
contractor) would permanently decrease to less than 50% of the average
level of bona fide services performed over the immediately preceding
<<months>> month
period.
|
16.
|
CPP
Limitations
.
|
|
(a)
|
The
Company has participated in the CPP, and the Company is required to comply
with the requirements of Section 111(b) of the EESA, in accordance with
the CPP Requirements.
|
|
(b)
|
Notwithstanding
any other provision of this Agreement to the contrary, the Associate
acknowledges and understands that this Agreement shall be administered,
interpreted and construed and, if and where applicable, benefits provided
hereunder, including where applicable vesting and/or transferability,
shall be limited, deferred, forfeited and/or subject to repayment to the
Company in accordance with the CPP Requirements and Section 111(b) of the
EESA, as amended from time to time, to the extent legally applicable with
respect to the Associate, as determined by the Committee in its
discretion, including without limitation the clawback, the bonus
prohibition and the golden parachute prohibitions
thereof.
|
|
(c)
|
This
Award is intended to provide a grant of TARP-compliant long-term
restricted stock and shall be administered and interpreted in accordance
with that intent and purpose.
|
|
(d)
|
Without
any further action, this Agreement shall be automatically adjusted if
necessary to reduce the number of Award Shares or Excess Shares to the
maximum number permitted for this Award, together with other awards
granted to the Associate in calendar year <<year of grant>>
that are taken into account in determining compliance with the
TARP-compliant long-term restricted stock exception to the bonus
prohibition in the CPP Requirements (i.e., if the aggregate of such awards
has a value in excess of the 1/3
rd
of annual compensation limit for TARP-compliant long-term restricted
stock), to constitute TARP-compliant long-term restricted stock; and in
such event the number of Award Shares or Excess Shares which are reduced
shall be immediately forfeited and excluded from the definition of Award
Shares or Excess Shares, as applicable,
ab
initio
, for all
purposes of this Agreement. If the Associate receives or has
received in calendar year <<year of grant>> other awards of
restricted stock and/or restricted stock units also intending to
constitute TARP-compliant long-term restricted stock, the reduction in
Award Shares or Excess Shares required by this Paragraph shall be applied
as follows: (i) any later grant of restricted stock or restricted stock
units to the Associate in calendar year <<year of grant>>
shall be reduced before any earlier award granted to the Associate in
calendar year <<year of grant>>; and (ii) if multiple
awards of restricted stock and/or restricted stock units that must be
taken into account in determining compliance with the TARP-compliant
long-term restricted stock exception are granted to the Associate on the
same day, (A) where such awards are “Time-Based” (i.e., those vesting
solely on the basis of time) awards and “Performance-Based” awards (i.e.,
those vesting, in whole or in part, on the basis of performance metrics),
the number of Award Shares shall be reduced pro rata in each award,
(B) where “Performance-Based” awards contain both Award Shares and
Excess Shares in one award agreement (as this Agreement does), the maximum
number of Excess Shares shall automatically be reduced by the same number
as the reduction in the Award Shares before application of any of the
Vesting or Excess Share issuance provisions of this Agreement (i.e., if
there is a one share reduction in Award Shares, there will also be a one
share reduction in the maximum number of Excess Shares that could be
issued), and (C) lastly all other awards shall be reduced on a pro
rata basis.
|
|
(e)
|
The
Committee shall have the right unilaterally to amend this Agreement to
effect or document any changes or additions which in its view are
necessary or appropriate to comply with the CPP Requirements and Section
111 of the EESA, as amended from time to time, including any changes or
additions which in its view are necessary or appropriate to ensure that
this Award constitutes TARP-compliant long-term restricted stock for
purposes of the CPP
Requirements.
|
COMPANY:
|
||
TRUSTMARK
CORPORATION
|
||
By:
|
||
Its:
|
||
ASSOCIATE
:
|
||
By:
|
|
|
<<name>> |
|
1)
|
I
have reviewed this quarterly report on Form 10-Q of Trustmark
Corporation;
|
|
2)
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
|
3)
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
|
4)
|
The
registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
|
a.
|
Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
|
|
b.
|
Designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
|
c.
|
Evaluated
the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
|
d.
|
Disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
|
5)
|
The
registrant's other certifying officer and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the registrant's auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent
function):
|
|
a.
|
All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information;
and
|
|
b.
|
Any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control
over financial reporting.
|
BY:
|
/s/ Richard G. Hickson
|
Richard
G. Hickson
|
|
Chairman
of the Board, President
|
|
&
Chief Executive Officer
|
|
DATE:
|
November
9, 2009
|
|
1)
|
I
have reviewed this quarterly report on Form 10-Q of Trustmark
Corporation;
|
|
2)
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
|
3)
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
|
4)
|
The
registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
|
a.
|
Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
|
|
b.
|
Designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
|
c.
|
Evaluated
the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
|
d.
|
Disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
|
5)
|
The
registrant's other certifying officer and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the registrant's auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent
function):
|
|
a.
|
All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information;
and
|
|
b.
|
Any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control
over financial reporting.
|
BY:
|
/s/ Louis E. Greer
|
Louis
E. Greer
|
|
Treasurer
and Principal
|
|
|
Financial
Officer
|
DATE:
|
November
9, 2009
|
|
1)
|
The
Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934;
and
|
|
2)
|
The
information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of
Trustmark.
|
BY:
|
/s/ Richard G. Hickson
|
Richard
G. Hickson
|
|
Chairman
of the Board, President
|
|
&
Chief Executive Officer
|
|
DATE:
|
November
9, 2009
|
|
1)
|
The
Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934;
and
|
|
2)
|
The
information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of
Trustmark.
|
BY:
|
/s/ Louis E. Greer
|
Louis
E. Greer
|
|
Treasurer
and Principal
|
|
|
Financial
Officer
|
DATE:
|
November
9, 2009
|