million allowance for credit
losses on loans held for investment represented 1.20% of commercial loans and 1.16% of consumer and mortgage loans, resulting in an allowance for credit losses to total loans held for investment of 1.19% and 572.69% of nonperforming loans, excluding
individually evaluated loans at year-end 2020.
Capital Strength
Trustmarks capital position remained solid, signifying the strength and diversity of our financial services
business. We continued our quarterly cash dividend to shareholders of $0.23 per share, or $0.92 annually, and during the fourth quarter of 2020, issued $125 million of 3.625%
fixed-to-floating rate subordinated notes, further strengthening our regulatory capital position. At December 31, 2020, total shareholders equity was
$1.7 billion, while tangible equity was $1.3 billion, representing 8.34% of tangible assets. Trustmarks regulatory capital ratios continue to significantly exceed levels necessary to be categorized as well capitalized. Our Board also
authorized a stock repurchase program under which $100 million of Trustmarks outstanding shares may be acquired through December 31, 2021.
Investing for the Future
We are committed to reengineering processes to improve operational efficiency and investments that promote revenue
growth. In 2020, noninterest expense totaled $475.2 million, and our efficiency ratio was 63.4%, which indicated an approximate cost of $0.63 to generate each dollar of revenue. While our efficiency ratio improved meaningfully from 66.4% in
2019, more work remains. We continued implementation plans in 2020 for new core loan and deposit systems that will notably expand capabilities and provide additional efficiencies.
|
|
|
|
We continued to realign our branch network to reflect customers evolving
preferences for online and mobile banking access. While customers continue to value face-to-face interaction, the pandemic has accelerated the pace of technology
utilization. During 2020, we consolidated six offices and expanded deployment of interactive teller machines, and will continue to encourage digital engagement and optimize our retail locations. Data analytics and customer relationship management
will remain an essential part of our future, both from a growth and efficiency perspective.
Leadership
We greatly value our Boards leadership, counsel and guidance. They are engaged in the companys governance
and strategic direction and support managements efforts to realize the potential of the Trustmark franchise. During 2020, James N. Compton, R. Michael Summerford and LeRoy G. Walker retired from the Board after a combined 50 years of service
to Trustmark. We appreciate their immeasurable contributions over the years and wish them all the best in their retirement.
We also welcomed General Augustus L. Collins, CEO of MINACT Inc., and Dr. Marcelo Eduardo, Dean of the School of Business, Mississippi College, to our Board. Each is an accomplished leader in their field and in the business
community. We welcome the diverse experiences and perspectives they will bring to Trustmarks Board.
Strategic Focus
Looking forward, Trustmark will focus on efficiency, growth and innovation, while building upon its solid risk
management processes, corporate culture and core values. We will continue to optimize delivery channels and technology to reflect changing customer preferences and enhance growth, while building long-term value for our shareholders.
We are grateful to our associates for their dedication, our shareholders for their investment in Trustmark and its
future, and our customers who have chosen us as their financial partner. Trustmark is People you trust. Advice that works.
Sincerely,
|