Note 7 –Other Real Estate, excluding Covered Other Real Estate

Other real estate, excluding covered other real estate owned, is recorded at the lower of cost or estimated fair value less the estimated cost of disposition. Fair value is based on independent appraisals and other relevant factors. Valuation adjustments required at foreclosure are charged to the allowance for loan losses. At June 30, 2011, Trustmark's geographic loan distribution was concentrated primarily in its Florida, Mississippi, Tennessee and Texas markets. The ultimate recovery of a substantial portion of the carrying amount of noncovered other real estate owned is susceptible to changes in market conditions in these areas.

For the periods presented, changes and losses, net on noncovered other real estate were as follows ($ in thousands):

	Six Months Ended June 30,
	2011			2010
Balance at beginning of period	$	86,704		$	90,095
Additions		32,878			34,045
Disposals		(23,191	)		(24,799	)
Writedowns		(6,392	)		(7,941	)
Balance at end of period	$	89,999		$	91,400


Gain (Loss), net on the sale of noncovered other real estate included in other expenses	$	552		$	(598	)

Other real estate, excluding covered other real estate, by type of property consisted of the following for the periods presented ($ in thousands):

	June 30,		December 31,
	2011		2010
Construction, land development and other land loans	$	62,697	$	61,963
1-4 family residential properties		13,840		13,509
Nonfarm, nonresidential properties		12,436		9,820
Other real estate loans		1,026		1,412
Total other real estate, excluding covered other real estate	$	89,999	$	86,704

Other real estate, excluding covered other real estate, by geographic location consisted of the following for the periods presented ($ in thousands):

	June 30,		December 31,
	2011		2010
Florida	$	33,823	$	32,370
Mississippi (1)		22,921		24,181
Tennessee (2)		15,760		16,407
Texas		17,495		13,746
Total other real estate, excluding covered other real estate	$	89,999	$	86,704

(1) - Mississippi includes Central and Southern Mississippi Region

(2) - Tennessee includes Memphis, Tennessee and Northern Mississippi Region