Leases

12 Months Ended

Dec. 31, 2023

Leases [Abstract]

Leases

Note 9 – Leases

Lessor Arrangements

Trustmark leases certain types of machinery and equipment to its customers through sales-type and direct financing leases as part of its equipment financing portfolio. These leases generally have remaining lease terms of three to ten years, some of which include renewal options and/or options for the lessee to purchase the leased property near or at the end of the lease term. Trustmark recognized interest income from its sales-type and direct financing leases of $3.2 million for the year ended December 31, 2023. Trustmark does not have any significant operating leases in which it is the lessor.

The table below summarizes the components of Trustmark's net investment in its sales-type and direct financing leases at December 31, 2023 ($ in thousands):

	December 31, 2023
Leases receivable	$	161,319
Unearned income		(29,011	)
Initial direct costs		1,326
Unguaranteed lease residual		4,101
Total net investment	$	137,735

The table below details the minimum future lease payments for Trustmark's leases receivable at December 31, 2023 ($ in thousands):

	December 31, 2023
2024	$	24,647
2025		25,617
2026		24,176
2027		36,295
2028		21,141
Thereafter		29,443
Total leases receivable	$	161,319

Lessee Arrangements

The table below details the components of net lease cost for the periods presented ($ in thousands):

	Years Ended December 31,
	2023			2022			2021
Finance leases
Amortization of right-of-use assets	$	786		$	1,479		$	1,546
Interest on lease liabilities		163			188			219
Operating lease cost		5,311			5,172			5,275
Short-term lease cost		277			389			463
Variable lease cost		906			1,150			1,234
Sublease income		(12	)		(168	)		(350	)
Net lease cost	$	7,431		$	8,210		$	8,387

The table below details the cash payments included in the measurement of lease liabilities during the periods presented ($ in thousands):

	Years Ended December 31,
	2023		2022		2021
Finance leases
Operating cash flows included in operating activities	$	163	$	188	$	219
Financing cash flows included in payments under finance lease    obligations		721		1,409		1,434
Operating leases
Operating cash flows (fixed payments) included in other operating    activities, net		4,188		4,829		4,781
Operating cash flows (liability reduction) included in other operating    activities, net		3,643		4,009		3,948

The table below details balance sheet information, as well as weighted-average lease terms and discount rates, related to leases at December 31, 2023 and 2022 ($ in thousands):

	December 31,
	2023			2022
Finance lease right-of-use assets, net of accumulated depreciation	$	3,751		$	4,537
Finance lease liabilities		4,334			5,055
Operating lease right-of-use assets		38,142			36,301
Operating lease liabilities		41,584			38,932
Weighted-average lease term
Finance leases	8.34 years			8.72 years
Operating leases	10.13 years			9.64 years
Weighted-average discount rate
Finance leases		3.61	%		3.49	%
Operating leases		3.64	%		3.22	%

At December 31, 2023, future minimum rental commitments under finance and operating leases were as follows ($ in thousands):

	Finance Leases			Operating Leases
2024	$	573		$	5,051
2025		584			5,119
2026		589			4,967
2027		594			5,020
2028		599			4,860
Thereafter		2,086			25,452
Total minimum lease payments		5,025			50,469
Less imputed interest		(691	)		(8,885	)
Lease liabilities	$	4,334		$	41,584