Trustmark Corporation (NASDAQ:TRMK) Q1 2022 Earnings Conference Call April 27, 2022 9:30 AM ET

Company Participants

Joey Rein - Director of Corporate Strategy

Duane Dewey - President & Chief Executive Officer

Barry Harvey - Chief Credit & Operations Officer

Tom Owens - Chief Financial Officer

Tom Chambers - Chief Accounting Officer

Conference Call Participants

William Jones - Keefe, Bruyette, & Woods

Bradley Milsaps - Piper Sandler

Operator

Good morning, ladies and gentlemen and welcome to Trustmark Corporation's First Quarter Earnings Conference Call. [Operator Instructions] As a reminder, this call is being recorded.

It is now my pleasure to introduce Mr. Joey Rein, Director of Corporate Strategy at Trustmark. Please go ahead.

Joey Rein

Good morning. I would like to remind everyone that a copy of our first quarter earnings release as well as the slide presentation that will be discussed on our call this morning is available on the Investor Relations section of our website at trustmark.com.

During the course of our call, management may make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We would like to caution you that these forward-looking statements may differ materially from actual results due to a number of risks and uncertainties which are outlined in our earnings release and our other filings with the Securities and Exchange Commission.

At this time, I'd like to introduce Duane Dewey, President and CEO of Trustmark.

Duane Dewey

Good morning and thank you for joining us. With me this morning are Tom Owens, our Chief Financial Officer; Barry Harvey, our Chief Credit and Operations Officer; and Tom Chambers, our Chief Accounting Officer. Trustmark had a solid first quarter in '22 with continued growth in loans and deposits, expanded total revenue and continued strong credit quality. For the first quarter, Trustmark reported net income of $29.2 million or $0.47 per diluted share.

So let's look at our financial highlights in a little more detail, turning to Slide 3. At March 31, '22, loans held for investments totaled $10.4 billion, an increase of $149.3 million from the prior quarter and $413.4 million from the -- in -- or the same period last year, a 4.1% increase. Deposits totaled $15.1 billion, an increase of $26.1 million linked-quarter and $730 million or 5.1% from this time last year.

Revenue in the first quarter totaled $153.5 million, a $4.4 million or 2.9% increase linked-quarter. Net interest income totaled $102.3 million in the first quarter, an increase of $1.1 million or 1.1% from the prior quarter. Noninterest income totaled $54.1 million and represented 35.3% of total revenue in the first quarter. Insurance revenue totaled $14.1 million, an increase of $2.4 million or 20.3% linked-quarter and a $1.6 million or 13.2% increase from the prior year. Noninterest expense in the first quarter totaled $121.5 million, a 1.7% increase from the prior quarter and flat year-over-year. Credit quality remained solid this quarter as nonperforming assets declined 8.9% from the prior year and recoveries exceeded charge-offs by $137,000. We also maintained strong capital levels with a Tier 1 ratio of 11.23% and a total risk-based capital of 13.53%. The Board declared a quarterly cash dividend of $0.23 per share payable June 15 to shareholders of record June 1.