A drop in mortgage banking cut into Trustmark's second-quarter profit, as did the costs to extend buyouts to employees.
Net income at the $13 billion-asset company fell 30% to $21.5 million from a year earlier. Total revenue rose 2% to $132.6 million. Deposits fell 3% to $9.5 billion.
The results included a $9.3 million charge to cover severance payments for employees who accepted buyout offers. The charge reduced quarterly earnings by 8.5 cents, to 32 cents per share. Trustmark, based in Jackson, Miss., estimated the buyouts will generate $4.2 million in savings in the second half of this year, and $8.5 million of savings in 2017.
Net interest income after the loan-loss provision fell 1.4% to $97.7 million on lower yields on earnings assets. The provision more than doubled to $2.6 million. Total loans held for investment rose 15% to $7.4 billion.
Noninterest income fell 2.9% to $44.2 million. Two of the major reasons were a 29% decline in mortgage banking income to $6.7 million and a 7.3% drop in deposit service charges to $11.1 million.
Noninterest expense rose 9.9% to $110.2 million on higher employee benefits and compensation and on higher foreclosure-related expenses.
Trustmark also disclosed that it will terminate its employee-pension plan on Dec. 31. Trustmark will record $12 million of expenses in the second quarter of 2017 to terminate the plan, but it said the termination will generate between $3 million and $4 million in yearly savings.