Sterne Agee Lowers Trustmark EPS

According to Sterne Agee, Trustmark TRMK reported 2Q11 EPS of $0.49 vs. $0.37 in 1Q11 and $0.41 in 2Q10. Sterne Agee said that Ex. the bargain purchase gain on the FDICassisted acquisition of Heritage Bank, operating EPS was $0.42 in 2Q11, which was in-line with estimate and above consensus of $0.39. “Although revenue growth (-3% Y/Y) reflected flat net interest income and a 10% Y/Y drop in noninterest income, the inclusion of Heritage allowed for operating leverage as revenue growth (+13% LQA) far outpaced noninterest expense growth (+6% LQA). TRMK's margin of 4.29% (-18 bp Y/Y; -1 bp LQ) in 2Q11 held up well considering that organic loan growth was -4% Y/Y; -5% LQA in 2Q11.” Trustmark closed yesterday at $22.97.